IMF Managing Director Kristalina Georgieva on Thursday called for adoption of "an international carbon price floor" for large emitters such as the G20 countries in order to limit the rise in global temperatures.
The head of the Washington-based crisis lender made the appeal during a virtual climate summit hosted by US President Joe Biden, which is bringing together 40 heads of state including Chinese President Xi Jinping and Russian President Vladimir Putin.
"Over 60 pricing schemes have been implemented, but the average global price is currently $2 a ton, and needs to rise to $75 a ton by 2030 to curb emissions in line with the goals of the Paris Agreement," Georgieva said, referring to the deal which calls for action to keep the planet's temperature within 1.5 degrees Celsius (2.7 Fahrenheit) above pre-industrial times.
"Because of the urgency to act, we propose an international carbon price floor among large emitters, such as the G20," she said. "Focus on a minimum carbon price among a small group of large emitters could facilitate an agreement, covering up to 80 percent of global emissions."
Georgieva said any system should be "pragmatic and equitable, with differentiated pricing for countries at different levels of economic development."
A carbon tax combined with increased investment in environment-friendly infrastructure could raise global GDP 0.7 percent per-year and create millions of jobs, she said.