Most people are familiar with the challenge of climate change. Few, however, relate strategies to reduce carbon emissions with a nation’s financial structures and institutions. Nevertheless, there is a critical link between in-country institutional arrangements, finance readiness processes, and the ability of developing nations to meaningfully address climate change.
The Nature Conservancy is proud to present a new report that clearly articulates this link and details lessons learned in Brazil, Costa Rica, Indonesia, Mexico and Peru on how best to design in-country financial architecture for receiving and utilizing international funding for climate action.
The report, “Climate Finance Readiness: Lessons Learned in Developing Countries,” aims to shed light on elements that help to enhance the efficiency and transparency of climate finance mechanisms as well as subsequent implementation. Jorge Gastelumendi, Senior Policy Advisor at the Conservancy’s Arlington, Virginia office, and Ariane Meier, Senior Policy Advisor at the Conservancy’s Europe Office, served as lead contributors to the report.
Climate finance readiness is a term increasingly used in the international arena to refer to the processes at regional, national and local levels through which developing countries get ‘ready’ to access, allocate, distribute, and make use of financial resources for climate change action, as well as monitoring and reporting of results. The idea is that recipient countries build up their respective internal financial infrastructure in order to act as full participants in emerging international climate financing arrangements.
Agreements made at the 2010 United Nations Framework Convention on Climate Change (UNFCCC) in Cancun included commitments by developed countries to provide (US) $30 billion between 2010 and 2012. They also pledged their best efforts to raise (US) $100 billion by 2020 in an effort to help developing countries tackle climate change. So there will be money out there. How to hand it out and to whom, however, is another matter.
Actually accessing and using these scaled-up financial flows is proving to be a major challenge for developing countries. Especially as they work to integrate climate change strategies into broader national development goals, many questions remain about how to access and utilize available resources and how to identify the best-suited mechanisms for catalyzing and supporting action on the ground.
With a long history of partnership-building, and broad and deep work on climate change, The Nature Conservancy is well suited to provide guidance on this issue. The new brief supports governments in their efforts to come up with the right solutions by analyzing and reflecting on lessons learned from our work in developing countries and providing recommendations based on best practices. First, the report captures the reality of existing financial landscapes; this survey is followed by clear and concise recommendations on planning processes and effective institutional arrangements.
It is hoped that the report will stimulate an international discussion on architectural approaches. At a recent Conservancy-hosted workshop where the paper was presented and its findings discussed, panelists from the U.S. Department of Treasury, Brookings Institute, United Nations Development Programme and the World Resources Institute provided commentary on the brief and reflected on the evolving nature of the climate finance conversation.
You can join the conversation by reading the white paper and sharing your thoughts below: we welcome your questions and comments. It is our intention to foster a robust dialogue between individuals, institutions, and nations, and we hope you’ll join us as we further investigate this critical link between climate change and in-country financial architecture.
Jorge Gastelumendi is a Senior Advisor, International Climate Policy for The Nature Conservancy
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