COP29: From ambition to action

8 November 2024 - Foreword of the week - By : Claire ESCHALIER

This coming Monday will see the start of COP29 – formally the 29th session of the Conference of the Parties to the UN Framework Convention on Climate Change (UNFCCC), in Baku, Azerbaijan. The edition is nicknamed “the finance COP” and is important on more than one account, not least as Trump’s victory likely leads to a change of course for the US on climate commitment.

 

The volume and structure of the finance mobilised to support developing countries to transition to low-emission and climate-resilient economies tops the agenda.

 

The New Collective Quantified Goal on Climate Finance (NCQG) – which should supersede the USD 100 billion per year target in place since 2020 – will set the tone for future ambition and collaboration. Beyond the amount of finance that Parties can collectively commit to, discussions must also provide clarity on how domestic and international public finance can best be invested, ensuring its additionality and efficiency.  

 

The outcome of the NCQG negotiations will structure many of the discussions to come, including around the reform of the global financial architecture, and the role of Public Development Banks (PDBs) in the renewed system. 2025 is expected to be a pivotal year for climate and development finance, with third generation NDCs to be submitted to the UNFCCC by February, the 4th International Conference on Financing for Development (FFD4) taking place in July, and culminating with COP 30, in November, in Brazil. The success of COP29 will be measured by the genuine commitment to more and better financing for the transition, essentially underpinning the next steps in 2025.   

 

I4CE is supporting the translation of the current and future country commitments into concrete actions. First, at country level, we help turn climate commitments into financing plans and we support the creation of robust accountability frameworks for sustainable finance. Next, to enhance the role of PDBs, we support ongoing discussions on Paris alignment approaches and the impact of financial intermediation. And finally, linked to the NCQG debate, we are engaged in the development of a better characterisation of finance flows that contribute to the transition, with Mainstreaming Climate in Financial Institutions.  

 

Find more information about these initiatives below and at our events at COP. 

 

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To learn more
  • 09/06/2024 Foreword of the week
    Gearing up the reform of the international climate finance architecture

    This autumn’s busy negotiation agendas, offer a window of opportunity to move the reform of the international climate finance architecture (IFA) up one level. This acceleration is urgent if we want to keep pace with the dramatic change in scale needed to finance the climate transition.  In 2023, developed countries announced that they had – for the first time since 2009 – achieved their USD 100bn/year climate finance target to support climate action in developing countries. Just two years later, this target is already obsolete, with needs for emerging and developing economies (excluding China) estimated at around USD 2.4 trillion per year by 2030. 

  • 07/02/2024
    Approaches to meeting the Paris Agreement goals: options for Public Development Banks

    Options for Public Development Banks. Since the adoption of the Paris Agreement in 2015, several public development banks (PDBs) have responded with structured approaches to align their operations with the Agreement’s expectations (as described in Section 1). However, many PDBs, particularly those in emerging markets and developing economies, are yet to adopt an approach to align with the Paris Agreement (i.e., Paris alignment). As entities whose investment mandates are established by the Parties to the Paris Agreement (i.e., national governments), PDBs have specific obligations derived directly from these Parties’ commitments to act across all policy and regulatory frameworks under their jurisdictions, including for state-owned or state-mandated institutions and agencies. Accordingly, PDBs are expected to operate in a manner that supports the achievement of the Paris goals. More specifically, they are obligated to integrate their activities within the Agreement’s implementation mechanism by providing financial, technical, and capacity building support that is entirely consistent with national low-emission climate-resilient development pathways.

  • 04/19/2024 Foreword of the week
    World bank and IMF Spring Meetings: How can the reformed institutions play a leading role in funding the transition?

    Rethinking how development can be financed to take into account the rising challenges of our time is a fastidious task, especially when thousands of experts, decision makers and practitioners want to leave their print. The outline of the new international financial architecture is being debated again this week, with more questions open for discussion than consensus on the answers. 

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