Climate Finance in the Paris Agreement
The Paris Agreement has handled several aspects related to climate finance, in particular:
A clear signal to continue and increase financial assistance
In its Article 9, Paris Agreement stipulates that developed country Parties shall provide financial resources to assist developing country Parties with respect to both mitigation and adaptation in continuation of their existing obligations under the Convention. Through a balance between adaptation and mitigation, country-driven strategies, priorities and needs of developing country Parties are to be considered. Other Parties are encouraged to provide or continue to provide such support voluntarily.
Furthermore, as part of a global effort, developed country Parties should continue to take the lead in mobilizing climate finance from a wide variety of sources, instruments and channels, noting the significant role of public funds, through a variety of actions, including supporting country-driven strategies, and taking into account the needs and priorities of developing country Parties. Such mobilization of climate finance should represent a progression beyond previous efforts.
The need for transparency
With regard to ex-ante communication of information, developed country Parties shall biennially communicate indicative quantitative and qualitative information including, as available, projected levels of public financial resources to be provided to developing country Parties. Other Parties providing resources are encouraged to communicate biennially such information on a voluntary basis.
In same context, developed country Parties shall provide transparent and consistent information on support for developing country Parties provided and mobilized through public interventions biennially. Other Parties are encouraged to do so.
A commitment to continue mobilizing $100 billion a year, with a new goal on the horizon
Developed countries have already committed to mobilize $100 billion a year in climate finance by 2020, and in Paris, they agreed to continue mobilizing finance at this level until 2025. Significantly, all countries agreed to contribute to the global effort to mobilize finance beyond previous efforts, with developed countries taking the lead. Prior to 2025, a new collective quantified goal from a floor of USD 100 billion per year will be set up, taking into account the needs and priorities of developing countries.
More specifications on Financial Mechanism and procedures
The Financial Mechanism of the Convention, including its operating entities, and the Standing Committee on Finance, shall serve as the financial mechanism of this Agreement. In addition, Article 9 stipulates that the institutions serving this Agreement, including the operating entities, shall aim to ensure efficient access to financial resources through simplified approval procedures and enhanced readiness support for developing country Parties, in particular for the least developed countries and small island developing States, in the context of their national climate strategies and plans.