Last week, the T20, the G20 engagement group of think tanks, delivered its Communiqué to G20 officials during its mid-term conference in Rio de Janeiro. As part of this process, IDDRI and Plataforma CIPÓ co-lead the T20’s Task Force 2 on Sustainable climate action and inclusive just energy transitions with the support of nearly 30 think tanks from all over the world. This blog post builds on this work to highlight the core opportunities for successful G20 climate and energy agendas in a period of increased geopolitical tensions on the road to Climate COP30 in 2025.
In an adverse geopolitical context, G20 can draw bridges – the just transition provides an opportunity
As voting results unfold in this year of exceptionally high number of elections worldwide, we observe a trend of continuity in power, albeit with weakened leadership, almost everywhere. While this continuity in leadership may promote consistency in narratives, reinforcing priorities around security, strategic autonomy and competitiveness, it also underscores the essential need for co-benefits between the environmental and development agendas in both wealthy and poorer nations. Across the globe, the profound structural and distributional impacts of the dual digital and green transitions highlight the need to mitigate negative externalities and address unequal impacts at both domestic and international levels, emphasizing the urgency of achieving a “just transition” (IDDRI, 2024).
This is a critical issue where G20, through its political leaders, finance ministers and central bank governors can make a difference. The succession of India, Brazil and South Africa in the rotating G20 presidency has raised expectations regarding the role the group can play not only in addressing the needs of G20 members and beyond, especially the most vulnerable groups within these nations, but also in promoting a just transition agenda and reducing inequalities between countries.
How can the G20 make a difference: international taxation, MDBs reform and country demand
First, there is momentum on the international taxation agenda, including Brazil’s push for a coordinated minimum taxation on the wealth of very-high-net-worth individuals, often referred to as the “super rich”. This proposal was outlined in a G20-commissioned report authored by Gabriel Zucman (Zucman, 2024) and is considered a technically and politically viable solution by a coalition of think tanks (Think Equal et al., 2024). For the first time, the call for a fairer international taxation agenda, discussed in various forums such as the Paris Pact for People and Planet or the dedicated Global Solidarity Levies Task Force, took centre stage at the World Bank and IMF’s spring meetings held in Washington last April. By advancing critical redistribution tools, such as provided by taxation or the repurposing of fossil fuel subsidies, the G20 can help attract new and additional financial resources in support of just energy transitions and climate action on the road to COP30 in Brazil.
In addition, as the main shareholders in Bretton Woods institutions and Multilateral Development Banks (MDBs), G20 countries have a unique opportunity to advance just transition objectives as part of the agenda to reform MDBs and optimize access to Multilateral Climate Funds. These efforts should focus on finance affordability, transparency, and the standardization of funding allocation criteria to prioritize vulnerable and low-income countries and communities.
It is also crucial to work on both the demand and supply sides. Given their significant political and economic weight, G20 countries should provide leadership in developing holistic transition plans–those were identified by both the G20 Task Force on a Global Mobilization against Climate Change (G20, 2024) and the Working Group on Sustainable Finance as core areas of G20 action (G20, 2024). It is the view of the T20 that such transition plans should support economic decarbonization, climate adaptation, biodiversity preservation, and universal access to clean and affordable energy while mitigating social impacts and reskilling labour forces.
In addition to leading by example, the G20 should also offer support for other countries to develop their own capacity to design and implement their transition plans. This also includes enhancing international cooperation to facilitate the transfer of existing technologies and the co-development of new, low-cost technologies that can foster green industrialization pathways in developing countries. Comprehensive transition plans are crucial mechanisms for establishing coherent and credible long-term funding demand that aligns with supply and can integrate effectively with country platforms, a much-discussed tool for coordination of development partners and alignment with country priorities.
On the road to COP30
Promoting just transitions on a global scale is not an easy task, as it requires in-depth understanding of the social impacts of transition and benefit-sharing between winners and losers. It can be a divisive issue, with countries often favouring nationalistic responses that prioritize their own populations over solutions rooted in international cooperation. These challenges further underscore the crucial role of G20 leadership in promoting just transitions, including by connecting its international finance architecture reform efforts with the priorities and principles of the United Nations Framework Convention on Climate Change (UNFCCC). This alignment can be fostered by elevating G20 support to the COP Presidencies’ Troika work to advance the ‘Roadmap to Mission 1.5°C’, a mechanism designed to stimulate ambition in the next round of nationally determined contributions with a view to enhancing action and implementation over this critical decade (CIPÓ 2024 and IDDRI 2024).
To conciliate environmental sustainability with the reduction of social inequalities and deliver on Brazil’s G20 presidency motto of “building a just world and a sustainable planet”, these efforts must meaningfully involve civil society, affected communities, think tanks and the private sector. The T20 Communiqué and the statement of the T20 Task-Force led by IDDRI and Plataforma CIPÓ outline a path in this direction. It is time for G20 leaders to take concrete steps to implement these recommendations.
