Lushoto, Tanzania, a learning site of Climate Change, Agriculture and Food Security. Photo by CCAFS/flickr
Nationally Determined Contributions (NDCs) submitted under the Paris Agreement create a strong signal for investors and companies looking for profitable investments in climate-resilient infrastructure. Combined with massive cost reductions and rising demand for sustainable agriculture and green buildings, the time has never been better to invest in climate business.
As part of the NDC Partnership’s Expert Perspective series, Tom Kerr and Aditi Maheshwari of the International Finance Corporation compiled “Unlocking Private Finance to Help Governments Achieve their Climate Goals” to help the private sector understand the investment potential of NDCs and help governments learn how they can unlock private investment for their climate targets.
IFC found that if the 21 emerging market countries profiled in the report achieve their NDC commitments, they could create a $23 trillion climate investment opportunity in emerging markets to 2030. Those opportunities are broken down by region and investment type in the Expert Perspective:
Kerr and Maheshwari say the business case for private climate investment is becoming clear as companies work to ensure their operations are resilient against supply chain disruptions and other effects of climate change. As a result, they note that businesses are already making climate-smart investments, instead of waiting for political action. The expert perspective concludes, however, that governments still have a critical role to play in unlocking private investment, and should:
Kerr and Maheshwari also find financial innovation is needed to secure sufficient private sector investment and fund low-carbon economic transitions, and highlight several tools and approaches to help governments unlock private finance, including:
For more details on global climate investment opportunities, innovative approaches, and country case studies, download the full Expert Perspectives paper submitted by Kerr and Maheshwari to the NDC Partnership.