"CAF has to become the big green bank of Latin America and the Caribbean"

Climate change is one of the major challenges of our time. This challenge, which must be tackled from a global perspective, is becoming increasingly important on political agendas. For years, both governments and companies have started to commit themselves to the environment and to develop measures to reduce their carbon footprint. 

In Latin America, Colombia has become an example in the energy transition in the region. On the occasion of President Iván Duque's visit to Spain, CAF, the development bank of Latin America, has organised a meeting on this issue that affects us all. Under the title "Energy transition in Latin America: challenges, opportunities and programmatic vision based on the Colombian success", Duque presented the measures that have been implemented in Colombia to become the regional model.

The new Executive President of CAF, Sergio Díaz-Granados, former Colombian Minister of Trade, Industry and Tourism, opened this event on energy transition. The meeting was held with a view to the next United Nations Conference on climate change to be held in Glasgow at the beginning of November. At this convention "crucial decisions will be taken" for the countries of Latin America, as Díaz-Granados stated. The executive president of CAF also described the Glasgow summit "as the most important of its kind".

These climate days will be conditioned by the coronavirus pandemic, a global challenge that was also highlighted by Díaz-Granados at the event held at Casa América. "Our region has been the hardest hit, in terms of lives, economic losses and fiscal damage. The region is weaker, poorer and more indebted than ever before," acknowledged the CAF president.

Díaz-Granados, paraphrasing biologist Cristián Samper, has linked this health crisis to the climate situation. "The pandemic, like climate change, like the loss of biodiversity, is related to the way in which human beings associate with nature," said the former minister. Reiterating Samper's words, Díaz-Granados said that "we live in a world in which there is a profound disconnection between human activities and the planet's capacity to absorb our way of life".

Aware of the dire outlook, CAF has announced its commitment to energy transition and the environment. The Latin American development bank has announced its "green" financing target, which is to seek at least 40% green financing by 2026. 

Díaz-Granados also reaffirmed the institution's commitment to helping shareholder countries achieve their 2030 goals, and in particular the environmental objectives. He also recognised the importance of cooperation with Spain, not only to tackle climate change, but also against the pandemic we have been experiencing since 2020. "Particularly the partnership with Spain today is more urgent than ever," said Díaz-Granados.

For Díaz-Granados, the energy transition has to meet a number of conditions. Firstly, this process must be inclusive, "leaving no one behind".  To this end, the needs of the rural world must be addressed, which, in the case of Latin America, is a "more than necessary" condition, as the Executive President of CAF points out. For this reason, public services such as transport must be improved, and pollution must be reduced.

In this regard, Díaz-Granados emphasised the so-called circular economy, a model of sustainable production and consumption that seeks to reuse, renew and recycle materials that can be used several times. 

Secondly, this transition must rely on technology to modernise, making electricity production more effective. "Technology that can ensure better distribution, better interconnection, better storage," Díaz-Granados explained. On the other hand, constitutional stability is key to achieving the energy transformation.

Díaz-Granados ended his speech by acknowledging the efforts made by the Colombian government to reduce its carbon footprint and highlighting the climate change law promoted by Spain. He also underlined "the level of ambition" of the European green pact. 

Subsequently, Teresa Ribera, Third Vice-President of the Spanish Government and Minister for Ecological Transition and the Demographic Challenge, reiterated Díaz-Granados' speech, assuring that "an unprecedented transformation" is necessary. Ribera congratulated Colombia for its recent climate achievements and also CAF for its projects in the region. According to the minister, the organisation "will play a key role in the well-being of citizens, not only in the cities, but also in rural areas". 

Iván Duque closed the round of speeches by referring to economic and social resilience. The Colombian president admitted that global efforts to tackle climate change have been the best, although he stressed that the world is still emitting polluting gases. "Climate action is not optional or optional, it is a moral duty," he said.

Duque also outlined the favourable situation of his country, which emits only 0.06% of greenhouse gases, a lower amount than some less populated countries in the region. He also acknowledged Colombia's particular vulnerability to climate change due to its geography. "Colombia is also one of the most threatened countries," he warned. The Latin American country is home to 50 per cent of tropical rainforest and 35 per cent of the Amazon biome. For these reasons, one of Bogotá's priorities is to protect the country's great biodiversity. "If we want to reach zero carbon neutrality, we have to recognise our situation and needs," he said.

For Duque, the path to zero is based on several points. Firstly, the energetic transition, where he once again emphasised Colombia's role. To make this transformation, it is necessary to bet on new technologies that can develop green hydrogen and blue hydrogen. Equally important is clean mobility. Duque presented the electric vehicle law developed by the government, a regulation that has led to Colombia having the largest fleet of public electric vehicles in Latin America. Another fundamental aspect of reaching zero emissions is the fight against deforestation. The most biodiverse areas must be protected so that they are not affected.

Finally, he referred to CAF's role in the region. Duque highlighted the joint work with the development bank to articulate policies to turn Amazonian cities into biocities. He also urged the institution to "become the green bank of Latin America and the Caribbean".

Following the speeches by Díaz-Granados, Ribera and Duque, Yolanda Gómez, deputy editor of the ABC newspaper, moderated a panel on the climate issue in the region. Diego Mesa, Colombian Minister of Energy and Mines; Carlos Eduardo Correa, Minister of Environment and Sustainable Development; Antonio Llardén, Chairman of Enagás; and Josu Jon Imaz, CEO of Repsol, took part in the debate. Like the previous speakers, they discussed the opportunities Colombia offers in terms of energy transition and the challenges that still need to be faced.