Australia, with the United Kingdom, led developed countries to deliver a Roadmap to meeting the collective goal of mobilising US$100 billion a year in climate finance for developing countries by 2020. The Roadmap aims to provide increased predictability and transparency about how the goal will be reached, and sets out the range of actions developed countries will take to meet it. Drawing on analysis by the OECD, the Roadmap shows that developed countries are well-placed to meet the US$100 billion goal, through a combination of public and mobilised private finance.
The US$100 billion goal was agreed by all countries at the UNFCCC Conference of Parties in 2010. As part of the Paris Conference outcome in 2015, developed countries were urged to scale-up their level of support and provide a ‘concrete roadmap’ to achieve the US$100 billion goal. Australia is committed to doing our part to meet the US$100 billion goal, and to support the broader transformation of finance flows needed to implement the Paris Agreement.
The Paris Agreement was a historic demonstration of all countries’ collective commitment to address climate change. As part of the Paris outcome, developed countries were urged to scale-up their level of support with a concrete roadmap to achieve the goal of mobilising US$100 billion per year by 2020 for climate action in developing countries.
In 2016, developed countries1 worked together to develop this Roadmap, including through consultations with developing countries.2
Since the commitment was made in 2010, developed countries have significantly scaled-up support to developing countries – aggregate levels were estimated at US$62 billion in 2014, up from US$52 billion in 2013. We expect this upward trend to continue, as evidenced by the significant pledges made by many developed countries and multilateral development banks (MDBs) in 2015.
Providing information on future finance levels is challenging including because not all countries can provide information about future budget allocations, and because actual climate finance depends on unknowns such as recipient demand, availability of projects, and indirect economic factors. To provide analytical support for the preparation of this Roadmap, a group of developed countries asked the Organisation for Economic Co-operation and Development (OECD) to analyse the possible impact of countries’ pledges on finance levels in 2020 based on what we know, or can reasonably assume, at the present time.
According to analysis by the OECD (2016),3 pledges made in 2015 alone will boost public finance from an average of US$41 billion over 2013-14 to US$67 billion in 2020 – an increase of US$26 billion. This projection is based on the significant pledges and announcements made by many developed countries and MDBs, as well as reasonable assumptions about trends of climate finance from other countries. It should be considered a conservative, indicative aggregation of public climate finance levels in 2020, rather than a firm prediction.
According to the analysis, modest assumptions about increased leverage ratios would lead to projected overall finance levels in 2020 above US$100 billion. We are confident we will meet the US$100 billion goal from a variety of sources, and reaffirm our commitment to doing so through the range of actions outlined in this Roadmap.
We recognise that adaptation is a priority for many developing countries. The OECD (2016) analysis indicates that the amount of public adaptation finance (bilateral and attributed multilateral) is projected to at least double in volume between 2013-14 and 2020.
Developed countries are committed to the US$100 billion goal, and are confident we will meet it.
Projected finance levels in 2020
Climate finance projections as per the roadmap that’s been presented by donor countries in October. Source: OECD
This Roadmap sets out the range of actions we will take and are taking to get there, including to:
- Fulfil our pledges and make further efforts to scale-up climate finance, and significantly increase finance for adaptation, in line with the priorities expressed by developing countries
- Help developing countries to develop and implement ambitious mitigation contributions and adaptation plans that are essential to attract investment
- Work with developing countries to address the barriers associated with access to climate finance, and to build institutional capacity and strengthen policy environments
- Use public finance and policy interventions to effectively mobilise private finance, which is critical not just for the US$100 billion, but to achieve the Paris Agreement objectives
- Partner with the MDBs to deliver transformational change, and work to maximise the impact of climate funds, including the Green Climate Fund and the Global Environment Facility
- Mainstream climate change into decision making, including development assistance, to align efforts to address climate change and achieve the Sustainable Development Goals
- Continue to improve tracking of climate finance, to share learnings and to understand where we can collectively do better
The transformation to a low greenhouse gas emission and climate resilient global economy will require efforts from all actors, beyond the scope of the US$100 billion goal. Developed countries intend to work with all countries to accelerate this transition and achieve the Paris Agreement goals.
1 The following countries were involved in producing this Roadmap: Australia, Austria, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, European Commission, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Japan, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Monaco, Netherlands, New Zealand, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, Switzerland, United Kingdom, and United States.
2 The Roadmap was made publicly available in October 2016.
3 OECD (2016), Projecting climate finance to 2020, http://www.oecd.org/environment/cc/oecd-climate-finance-projection.htm