ANKARA – Global fossil fuel subsidies amounted to around $ 6 trillion in 2020, said the head of the International Monetary Fund (IMF).
That amount represented 6.8% of the world’s gross domestic product (GDP), Kristalina Georgieva told the United Nations High-Level Dialogue on Energy on Friday.
“The science is clear. Without dramatic reductions in the use of fossil fuels, we will see untold destruction of our environment and continued damage to people’s health and livelihoods, ”she warned.
Georgieva said global carbon emissions would fall by a third, consistent with maintaining global warming at 1.5 degrees Celsius, if fossil fuel prices increased to fully reflect environmental and supply costs by 2025.
“Getting fossil fuel prices right is essential to achieve these reductions. The right prices must fully reflect both procurement costs and environmental costs, especially carbon emissions and local air pollution, ”she said.
Georgieva added that if the increase in fossil fuel prices reflected environmental and supply costs, which she described as “very difficult”, additional income would increase by almost 4% of global GDP, which could be used to stimulate green investments and social spending.
She said the IMF has proposed an international floor price for carbon among large emitters based on levels of development, which would help determine the right price for fuel. (Anadolu)