{"id":2218,"date":"2026-04-12T00:22:24","date_gmt":"2026-04-12T00:22:24","guid":{"rendered":"https:\/\/www.europesays.com\/spain\/2218\/"},"modified":"2026-04-12T00:22:24","modified_gmt":"2026-04-12T00:22:24","slug":"after-seville-daniela-gabor","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/spain\/2218\/","title":{"rendered":"After Seville\u00a0 | Daniela Gabor"},"content":{"rendered":"

The fourth UN Financing for Development<\/a> conference, which concluded in Seville earlier this month, was a high-stakes meeting. The climate crisis is accelerating while climate commitments are weakening; official development assistance is shrinking while debt service is eviscerating poor countries\u2019 education and health budgets. The negotiated outcome from the conference, known as the \u201cSeville Compromiso,\u201d is a mixed bag. The very forces behind the climate-debt crisis\u2014capital\u2019s twin wings, Big Finance and Big Tech\u2014have strengthened their grip on the ambitions for \u201ctransformative development.\u201d Around 6,000 corporate lobbyists (nearly half the total attendees) swarmed Seville\u2019s plenary halls, peddling \u201cblended finance,\u201d \u201ccapital mobilization\u201d and \u201cAI for SDGs,\u201d while Southern delegates pleaded for debt relief and climate finance. On the other hand, the Compromiso endorsed (on paper) a UN intergovernmental debt architecture process (with opt-outs<\/a> from rich countries), tax justice, and social protection<\/a>. In reality, it recycled the magic Billions to Trillions thinking that had become dogma at the\u00a0 Addis Ababa conference a decade ago\u2014that is, development will only happen if it is investible, if it can mobilize private capital. The Compromiso added a notable qualification: investors should pay closer attention to development outcomes.\u00a0 BlackRock, we learnt in Seville, should ensure that its \u201cinvestible\u201d hospital in India, partly subsidized by concessional funding and partly by local health spending, ticks an SDG box. But the real battle raged elsewhere. While debt campaigners debated principles, the \u201cderisking complex\u201d\u2014lobbyists, finance ministries, and multilateral banks\u2014was laser-focused on one goal: how to turbocharge private capital into development assets.\u00a0<\/p>\n

Still, multilateralism survived Seville. Its next stage will be COP30 in Bel\u00e9m\u00a0 in November. The Brazilian hosts are in a delicate geopolitical position. For the first time since he took power in 2012, China\u2019s Xi Jinping snubbed the July meeting of the BRICS countries in Rio de Janeiro, prompting speculations about the group\u2019s cohesion and its future as an alternative to Western (US) hegemony.\u00a0 In retaliation for what he has termed the \u201clegal mistreatment\u201d of former president Jair Bolsonaro, Trump has threatened 50 percent tariffs against Brazil. For his part, whilst insisting that \u201cBrazil belongs to the Brazilians,\u201d Lula has been careful not to overly\u00a0 antagonize the US. For instance, Brazil attended the Hague Group\u2019s Emergency Conference for Gaza, convened by South Africa and Colombia in Bogot\u00e1, but it did not join the twelve countries that announced formal sanctions against Israel.<\/p>\n

What does this mean for Brazil\u2019s leadership of climate multilateralism? The parties to the COP29 conference in Baku agreed on a Baku to Belem Roadmap. They have called on \u201call actors to work together to enable the scaling up of financing\u201d to developing countries for climate action, to the tune of \u201cat least USD 1.3 trillion per year by 2035.\u201d Brazil is in charge of developing that Roadmap and building consensus for it until the Bel\u00e9m meeting takes place in November.<\/p>\n

To that end, and as a first step, Brazil launched the COP30 Circle of Finance Ministers<\/a> in April. The fact that Finance Ministers, and not ministers for the environment, are the first port of call in global climate negotiations is notable. As the late Malawian economist Thandika Mkandawire noted, the Washington Consensus turned Finance Ministries into enforcers<\/a> of neoliberal orthodoxy. Ministries of Finance, once simply accommodating the decisions of the spending and planning ministries\u2014Ministries of Trade, Industry, Education, and Agriculture\u2014gained ground in the 1960s and 70s, and \u201cpalace wars\u201d were fought as the development paradigm shifted from planning to the Washington Consensus. The developmentalist view of economists in spending ministries made way for the technocratic \u201cwatchdogs of spending.\u201d Recognizing this, Brazil had little choice but to summon Ministers of Finance, the designated gatekeepers of neoliberalism. It is finance ministers, after all, who find tremendous appeal in the promises of investible investment, hoping that small amounts of public money can activate the power of private cash.<\/p>\n

The Baku to Belem Roadmap to $1.3 trillion, as it is known, appeals to derisking in its very title: private and public finance will be mobilized to raise those $1.3 trillion. Brazil has to craft that Roadmap and build consensus for it until the Belem meeting. It has therefore proposed five strategic priorities for the COP30 Circle of Finance Ministers:<\/p>\n

Reforming Multilateral Development Banks (MDBs);<\/p>\n

Expanding concessional finance and climate funds;<\/p>\n

Creating country platforms and boosting domestic capacity to attract sustainable investments;<\/p>\n

Developing innovative financial instruments for private capital mobilization;<\/p>\n

Strengthening regulatory frameworks for climate finance.<\/p>\n

Priorities 1, 3, and 4 seek to enhance the institutional ecosystem of derisking, which, for many in Seville, has so far failed. Derisking lobbyists have a simple explanation: there aren\u2019t enough investible projects\u2014not because investors want high risk-adjusted returns from development, but because the \u201cpublic\u201d side of the public-private partnership hasn\u2019t delivered on the promised institutional upgrade. Reforming the MDBs, also on the agenda in Seville, is narrowly about enhancing their capacity to mobilize private finance, through instruments such as mobilization target ratios, the World Bank\u2019s guarantee platform, and other measures to coordinate across institutions. Country platforms, promoted as country-owned, coordinating mechanisms for key stakeholders, are intended to smooth over the obstacles to \u201cinvestibility\u201d that have so far characterized these development efforts. But the Just Energy Transition Partnerships (JETPs) in South Africa, Vietnam, Indonesia, and Senegal are not encouraging for derisking advocates. Adam Tooze once dubbed<\/a> them \u201cthe Paper Tigers of Western climate geopolitics,\u201d and not much has changed since. The JETPs coalitions of private financiers, donors and local governments have not<\/a> mobilized the billions they promised to, and they are less likely to do so without US participation. Instead, the JETPs have been a vehicle to legitimize the privatization<\/a> of the energy sector. For instance, South Africa\u2019s JETP is currently focused on derisking<\/a> private investments in transmission.<\/p>\n

The JETP for Vietnam offers a fascinating case of a country that can flex its transformative muscle against derisking once its government accepts that private returns are excessive. Vietnam has benefited from the current geopolitical tensions, as many Western corporations have shifted out of China to diversity value chains.\u00a0 Apple, Samsung or Intel have relocated there, attracted in part by Vietnam\u2019s renewable energy strategy. Indeed, since 2017, Vietnam\u2019s state utility EVN has purchased renewable energy at above-market prices, a derisking subsidy intended to attract foreign investors. As EVN got locked into a high-cost derisking strategy, its losses reached USD1 billion by 2023. In response, the Vietnamese government decided to roll back such favorable terms, with investors \u201craging<\/a>\u201d over its alleged breach of power contracts.<\/p>\n

Priority 2, expanding concessional finance and climate funds, is also part of derisking capacity building. It could see concessional finance directed into private climate funds, such as BlackRock\u2019s Climate Finance Partnership, started with concessional funding from Japan, Germany and France. Its 2025 Impact<\/a> report boasts a series of successful \u201cinvestible energy\u201d projects, including Lake Turkana Wind Power, Kenya\u2019s largest private renewable energy project. The Lake Turkana project sheet confirms again that the Seville Compromiso nod to investible \u201cdevelopment outcomes\u201d needs a tighter institutional framework to govern derisking, as detailed in my first Dispatch<\/a> from Seville. According to BlackRock, Lake Turkana is delivering SDG outcomes on renewable energy, water, access to electricity, etc. But this is highly misleading.<\/p>\n

Lake Turkana Wind Power is an egregious example of green extractivism masquerading as energy sovereignty. It has locked the state-owned Kenya Power into a costly twenty-year power purchase agreement (PPA). By late 2024, a Kenyan parliamentary committee asked the Ethics and Anti-Corruption Commission and the Directorate of Criminal Investigations to probe the state employees that signed the LTWP PPA, while the government imposed a moratorium on PPAs. Local trade unions went further, demanding that Kenya \u201crevoke all PPAs that have been signed with various IPPs and renegotiate better contracts that are flexible and also provide for payment in Kenya Shillings.\u201d\u00a0<\/p>\n

\"\"Climate Finance Partnership Impact Report, 2025<\/p>\n

Indeed, the \u201cinvestible renewables\u201d strategy turned out to be more than a fiscal time bomb. It undermines transformative development. Saddling the country with the second highest energy costs on the continent, it has eroded the room for green industrial policy while undermining the competitiveness of local manufacturers. Kenya may try to pull a Vietnam and renegotiate those contracts, but anything perceived to undermine the mobilization of private capital would spark a chorus of outrage.\u00a0<\/p>\n

To its credit, Brazil has tried to shift tack on Priority 2 with its Tropical Forest Forever Facility (TFFF<\/a>) initiative. Should the concept be brought to fruition, it\u00a0 would initiate a blended finance fund (the Tropical Forest Investment Fund, TFIF) to mobilize private capital for the state, rather than for private owners of investible infrastructure. Brazil wants the TFIF to raise $25 billion in concessional lending from rich countries (although the US commitment is now in doubt) and then issue another $75 billion in debt (presumably fixed income bonds), the proceeds of which would be invested in emerging countries\u2019 sovereign bonds. The interest-rate differential, estimated at around 2\u20133 percent, would be used to first service TFIF\u2019s senior debt, then to pay interest due on its sponsor capital, and lastly to make results-based payments to tropical-forest countries. While the Global Forest Coalition and other forest activists are rightfully critical of the restorative potential of such market-based initiatives, the merit of this initiative is that it appropriates the language and logic of derisking without privatizing forests, instead aiming to direct resources to public authorities. <\/p>\n

The fifth priority is to strengthen regulatory frameworks for climate finance. It is deliberately ambiguous. It seeks to enlist proponents of two fundamentally opposed approaches to climate finance: derisking and disciplining. For derisking advocates like the Climate Policy Initiative, this is about \u201cappropriate<\/a> enabling environments\u201d that \u201ccould crowd in the required private finance for achieving $1.3 trillion.\u201d It involves \u201cdeveloping and operationalizing sustainable finance taxonomies, integrating climate risk into prudential regulation, and adopting stronger carbon pricing frameworks.\u201d This is the language of the derisking approach to decarbonization: the strongest possible financial regulation is the incorporation of climate risks in prudential regulation, a single materiality (from climate crisis to private financial performance) take that BlackRock and other dirty financiers have long pushed in Europe, where attempts to regulate dirty finance have been strongest. It is the same regulatory language of the Seville Compromiso, which frames decarbonization as a financial stability issue alone, and resorts to weak instruments\u2014weak because of the essentially voluntary nature of the process\u2014like transition plans and climate stress testing.<\/p>\n

But the word \u201cstrenghten\u201d invokes a different strategy, one of building state capacity to discipline carbon financiers. Not so long ago, just before the Covid-19 pandemic, European regulators and politicians adopted \u201cdouble materiality\u201d as the basis for decarbonizing finance \u2013 somewhat shockingly, double materiality was also mentioned in the Compromiso, presumably because few understand its rather radical origins. BlackRock lobbied<\/a> hard against double materiality<\/a> because it doesn\u2019t just focus state efforts on protecting financiers\u2019 balance sheets from the climate crisis. It recognizes that\u00a0 financiers\u2019 dirty lending has material effects on the climate crisis itself. A double materiality approach requires the state to penalize dirty credit. This means building state capacity to include a disciplinary aspect\u2014carrots and sticks<\/a>\u2014in climate-policy that is fundamentally at odds with the derisking agenda that puts private capital in the driver\u2019s seat. Even if the political appetite for brown penalties has diminished everywhere, carbon financiers continue to worry about a future in which Big Green States decide that substantive penalties on dirty finance would rapidly scale up climate finance by redirecting capital flows. Given that Brazil has recently weakened<\/a> environmental licensing laws, it would seem the derisking approach will dominate Priority 5 too.\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"The fourth UN Financing for Development conference, which concluded in Seville earlier this month, was a high-stakes meeting.…\n","protected":false},"author":2,"featured_media":2219,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[1703,1704,109,1705],"class_list":{"0":"post-2218","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-seville","8":"tag-development","9":"tag-finance","10":"tag-seville","11":"tag-shortform"},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/posts\/2218","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/comments?post=2218"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/posts\/2218\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/media\/2219"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/media?parent=2218"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/categories?post=2218"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/tags?post=2218"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}