sabine mauderer : climate adaptation requires greater global attention speech by dr sabine mauderer, vice - president of the deutsche bundesbank, at the network for greening the financial system ( ngfs ) finance day, australian prudential regulation authority, baku, 14 november 2024. * * * check against delivery 1 introduction ladies and gentlemen, it is great pleasure and honor to be here today at this critical session on climate adaptation finance. i have been listening to the panel discussion with great interest. there is one aspect that struck me : namely that, at this point, there is no way back. adaptation means moving ahead. we gather here today as the number of severe weather events continues to rise, fueled by climate change. the widespread flooding that hit baku last month is a clear example. 1 so are the devastating floods that claimed over 200 lives in the spanish region of valencia at the end of october. 2 it was one of the worst natural disasters in spain's modern history. it is clear that we urgently need to bolster our defenses against severe weather events. yet, climate adaptation measures remain insufficient – in both the global north and the global south. so, what are the key takeaways of today's session? 2 to - dos in climate adaptation first : efforts to adapt to climate change must accelerate. the world bank estimates that a mere 5 % of global climate finance is allocated to adaptation. 3 this means that – out of a total of usd 1. 4 trillion allocated for climate finance in 20224 – less than usd 100 billion went into climate adaptation. 1 / 4 bis - central bankers'speeches only a fraction of this sum reaches emerging and developing economies, which suffer heavily from the effects of climate change. frankly, we ought to do better. second : more private funds need to flow into adaptation. the united nations environment program ( unep ) estimates that the adaptation finance needs of developing countries are around 14 times the current size of international public adaptation finance flows. 5 therefore, the gap will not be met by public funds alone, the financial sector needs to play a role too. third : we need to tackle existing barriers to adaptation finance, starting with lack of awareness among some stakeholders. 6 other hurdles include underdeveloped capital markets in many of the countries that are most affected by climate change, and the fact that adaptation investments often serve a common good. these factors make it challenging to generate enough private capital for adaptation measures. last, but no least

and it still seems too early to announce its end. however, we certainly are in a phase where the lessons learnt are being turned into political reality. this is especially true for the reform of financial regulation. great effort has been put into addressing the shortcomings in the regulatory framework that were revealed by the crisis. at the global level, a comprehensive reform agenda was set in train by the g20 summits in washington, london and pittsburgh. the envisaged reforms aim at creating a strong regulatory framework that ensures financial stability and supports steady and sustainable economic growth. the major step towards that end will be the reform of the basel ii framework for capital regulation. relevant proposals were put forward in december 2009 by the basel committee on banking supervision. the proposed measures have since been calibrated and have been decided as a package last weekend in basel by the meeting of governors and heads of supervision. in november, the g20 will take the final decision on the implementation of this package. the new rules will shape the financial system for years to come. there is some concern in the financial industry regarding the possible negative impacts of financial reform on the real economy. it is argued that, by placing additional burdens on banks, their capacity to hand out loans is constrained to a degree that might reduce economic performance. however, recent studies by the basel committee on banking supervision and others show that the impact of financial reforms on economic performance is likely to be rather small. nevertheless, this is an important issue and i am glad that mark will be covering it in more detail. the title of his speech is “ the economic consequences of the reforms ” and he is indeed the right man to provide the necessary insights. 4. on the speaker during his career, mark carney has been working on all sides of the financial system, so to speak. with a sound academic background from harvard and oxford, he joined the investment bank goldman sachs in 1990. for the next 13 years, he worked in the banks ’ offices in london, tokyo, new york and toronto. in 2003, he became deputy governor of the bank of canada. a year later, he left the bank and assumed the post of senior associate deputy minister of finance. in this function, he represented canada in various international forums, including the financial stability forum which is now the financial stability board. in 2008, he returned as governor to the bank of canada. it is this blend of different viewpoints and experiences that makes mark carney the perfect speaker for today ’