Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment his Department has made of the impact of levels of sovereign debt on the ability of lower income countries to invest in climate change (a) mitigation and (b) adaptation.

The UK recognises the significant debt vulnerabilities faced by many low-income countries and that high debt service levels may impact efforts to invest in and respond to climate change, as well as other development goals.

We are fully committed to helping the most vulnerable countries address the challenges they face. At COP27, the UK announced that UK Export Finance will become the first export credit agency in the world to offer Climate Resilient Debt Clauses (CRDCs) in its direct sovereign lending. These clauses build in debt repayment pauses when a climate shock or natural disaster hits. We also developed and published key design principles for CRDCs in private sector lending.

The UK is also delivering on our commitment to spend £11.6bn of International Climate Finance (ICF), striking a balance between mitigation and adaptation spending.