Curbing climate change would cost no more than 1 percent of global income per year, and the world can afford it, development economist Jeffrey Sachs said on Wednesday.

"If we look seriously at mitigation, it is not too expensive," he told a conference in Geneva on the humanitarian impact of climate change.

"If we invested around $700 billion per year, we would be able to create a sustainable energy system."

The United States spent just $3 billion on sustainable energy last year - equal to 36 hours of spending by the Pentagon on defence, according to Sachs, who is director of the Earth Institute at New York's Columbia University.

"The costs of getting off the calamity path of climate change are small, but markets will not do this alone," he said.

Sachs said there had not been enough research to develop and test low carbon technologies, partly because the private sector had not been willing to pay.

He argued it was imperative to find a way to reduce greenhouse emissions without stopping economic growth.

"Commitments should be for everybody - but developing countries won't commit to asphyxiating their economies. There should be a commitment to adopting low emissions technologies as they become available."

Former U.N. Secretary-General Kofi Annan called for an international debate on how to finance solutions to climate change, particularly measures to help people cope with the consequences of global warming.

The United Nations Development Programme has said at least $86 billion in new financing is needed by 2016 to help the world's poor deal with the consequences of climate change such as floods and droughts.

"We need innovative and creative sources of funding, because the amounts are mind-boggling and we can't rely on governments alone," said Annan, president of the Global Humanitarian Forum, which organised the conference.

Annan said the forum would put together a taskforce to work out how to secure the necessary resources to meet the immediate shortfall.

He stressed that this could not wait for a climate deal expected to be agreed in Copenhagen in December 2009 to widen and toughen the existing Kyoto Protocol.

Suggestions at the Geneva conference for raising funds included a global carbon tax on major polluting companies, insurance for small farmers and catastrophe bonds, which protect the buyers against financial losses from disasters.

Sachs criticised governments for failing to meet even the commitments they have already made to provide relief and development aid.

"How the rich world leaves the poor world to die is the biggest mistake on the planet," he said.

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