Chapter 15 - Assessment of mechanisms and instruments of climate finance: a global perspective

Abstract

The world is experiencing adverse impacts of climate change on agriculture, human health, and marine life, and other economic implications. As the nations aim to achieve the objective of UNFCCC to limit global warming to 1.5–2°C and increase climate resilience, additional funds are required to flow toward climate finance. The setting up of the Green Climate Fund was expected to lead to a paradigm shift or transformational change toward low-emission and climate-resilient pathways. However, an increasing emphasis has been put to seek various other financing sources to support projects on greenhouse gas mitigation and adaptation. Commitments under the Paris Agreement require a certain shift for development pathways of developing countries with support from developed economies. Funding gaps have remained an issue to achieve these objectives and need to be addressed with the help of private players, especially global financial institutions. In this regard, exploring all available choices of suitable channels is also very imperative. Other challenges include lack of reliable data on private flows of capital, effective management and governance to implement projects in developing nations, limited awareness about climate change impacts, Biennial assessment of climate change fund flows and incomplete information on additionality of climate investments are also discussed in this chapter.