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Global Climate Finance Status (OECD Report 2021) - Coggle Diagram
Global Climate Finance Status (OECD Report 2021)
Central Idea
Purpose: To support climate change mitigation and adaptation in developing countries.
Shortfall: Developed countries didn't meet the $100 billion/year target for climate finance to developing countries.
What is Climate
Finance?
UN Frameworks: Supported by UNFCCC, Kyoto Protocol, and Paris Agreement.
Definition: Financial support from public, private, and alternative sources for climate change mitigation and adaptation.
Why is Climate
Financing needed?
Green Technology Investments: Financing for technologies to limit global warming.
Mitigation Efforts: Funding for reducing emissions and transitioning to low-carbon technologies.
Rectifying Historical Injustice: Balancing the financial burden between developed and developing countries.
Adaptation Needs: Financial support for vulnerable regions to adapt to climate impacts (e.g., sea-level rise, extreme weather).
Mechanisms of
Climate Finance
Multilateral Funds: GEF, GCF, SCCF, LDCF, Adaptation Fund.
Other Channels: Climate Investment Funds, bilateral agreements, China's Kunming Climate Fund.
Kyoto Protocol Mechanisms: Includes CDM and Joint Implementation.
Climate
Financing
in India
Funding Sources: Union and State Budgets, External Support, Multilateral and Bilateral Agencies.
Specialized Funds: National Adaptation Fund, National Clean Energy Fund, Compensatory Afforestation Fund, Disaster Response Funds.
Central Agency: Climate Change Finance Unit in the Finance Ministry.
Challenges
Debt Concerns: Loan-based funding increases debt in low-income countries.
Private Sector Dynamics: Focus on 'bankable' projects over essential needs.
Focus Disparity: Overemphasis on mitigation, underfunding adaptation.
Investment Hesitancy: Long-term nature of climate projects deters investors.
Definition and Accounting: Varying definitions and accounting issues lead to operational challenges.
Way Forward
Institutional Development: Establishing a national climate finance regulatory authority.
Private Finance Optimization: Reducing investment risks and providing viability gap funding.
Principles of Equity and Justice: Ensuring climate finance is needs-based and fair.
Strengthening Financial Markets: Developing new financial instruments for climate resilience.
Enhanced Accountability: Regulatory oversight for efficiency and transparency.