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Resourcing NAMAs – Stepping stones in a national climate financing strategy

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Nationally Appropriate Mitigation Actions (NAMAs) are emerging as voluntary strategies, policies, programmes or projects, initiated by developing country governments, which contribute to reductions in greenhouse gas emissions.

This paper suggests that one of the key benefits of NAMAs is that they allow countries to demonstrate and test the challenges, opportunities and resources needed for a long-term transition to low-emission and climate-resilient development. In addition, they can offer valuable information on the necessary partnerships, institutional requirements and capacities.

NAMAs can be supported by developed countries through finance, technology transfer and capacity building. Hence, they are directly linked to climate finance, as they can attract and channel national and international sources of public and private finance for climate action. E3G proposes that NAMAs are useful means to design large-scale investment programmes to attract long-term private capital and facilitate sector transformation and new sector development. They build an evidence base and investor confidence through demonstration and understanding of risk-reward profiles.

However, the strategic coordination of NAMAs within a country’s government is a key requirement for the transformational role NAMAs might play. Creating institutional platforms to coordinate support for NAMAs helps with minimising institutional and transaction costs, optimising the demand and supply of finance, and enhancing the implementation of NAMAs.

Our paper offers several institutional options for the creation of a platform to mobilise resources the national level. These include:

  • Individual sector departments
  • Environmental funds and/or development agencies
  • Ministries, planning departments or the national budget authority
  • New institution/fund created by government

Through this kind of coordination, NAMAs can be better aligned with national development plans in a country-driven approach and, as such, can serve as a key component of strategic national approaches to climate finance.

This short paper is the first in a series of discussion topics on country experiences and financial mechanisms following E3G’s Strategic National Approaches to Climate Finance published in April 2014.

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