This briefing examines how developed countries can achieve success with a forthcoming climate finance plan by joining up across different policy processes to deliver credibility and ambition in scale.
Surpassing the $100bn in climate finance will be vital for rebuilding trust and raising international ambition by COP26, including for action by major emitters. Vulnerable countries have called for, and developed countries are now committed to developing, a plan for delivering on the commitment of $100bn per year in climate finance from 2020-2025. The following are requirements to ensure the success of the forthcoming multi-year plan:
- Timeliness: to actually regain trust and give space to ambition politics, the plan must land sufficiently ahead of Glasgow, ideally around UNGA.
- Scope: the plan must include immediate actions for delivering the $100bn in 2021 as well as a multi-year roadmap.
- Quality: the plan must offer collective sub-targets for adaptation finance, grant-based and concessional finance, and other components.
- Quantity: to make amends politically for prior shortfalls, the plan must aim to deliver larger sums in 2022-2025 above $100bn.
Achieving all of these in a climate finance plan will require contributor countries to undertake swift, higher-level diplomacy in a whole-of-government approach. In particular, the following policy considerations will be key to determining whether the climate finance plan will achieve sufficient scale:
- Specific national climate finance pledges
- The role of reallocated IMF Special Drawing Rights
- Increasing financial capacity of international finance institutions
- Wider ambition on development assistance, including “B3W”