Using practical examples for everyone, we examine how these instruments are currently being used to promote actions, how they are integrated into existing processes to track progress, and at the heart of efforts to increase Article 2.1c`s ambitions. In order to limit the scope of this scheme, we focus on financial policies and rules related to the specific purpose of Article 2.1 quater. We have not included more comprehensive policy and regulatory analysis that is essential to achieving the mitigation and adaptation objectives of Articles 2.1 bis and 2.1b, while recognizing that they are also essential for the organization of finances. To meet their obligations under the Paris Agreement and take advantage of the broader benefits of climate-friendly investments, governments and non-state actors must identify processes – both within the UNFCCC and beyond – to implement Article 2.1c and explore the range of tools available to manage the transition at a lower cost. Contracting parties need clear, robust and consistent guidelines to ensure a fair and effective implementation of the Paris Agreement. This document sets out a three-part framework to help governments and non-state actors identify ways to take action to mobilize and transfer financial resources; (2) track progress on national territory under Article 2.1 quater; and (3) to increase ambitions. As part of the focus on approaches that can be followed both inside and outside the UNFCCC, the authors also outline the four main instruments that governments can use in the first place to defer funding. This includes financial policies and regulations, fiscal levers, public finances and information tools. Although the provision of the Paris Agreement on “adapting financial flows to reduce greenhouse gas emissions and climate-resistant developments” is broadly formulated, it reflects a degree of convergence between the parties. As the text states, such efforts may include everything within the authority of the state, such as regulation, green fiscal policies and the provision of official sustainable development assistance, so that financial resources go to carbon neutrality. However, given the time constraints required to achieve the UNFCCC`s final goal, there has been a growing awareness that public finances alone are needed at the global level, but may not be sufficient. The EIB`s announcements to double its share of sustainable financing to 50% are not enough to meet the Paris Agreement`s objectives, making the need for large-scale private sector investment.
Finally, we will outline the next and most important steps that will be needed to ensure that UNFCCC processes and related activities help countries achieve the objectives of Article 2.1 quater. These include Article 2.1c of the Paris Agreement, which takes new paths. This is the first time that the framework process of the United Nations Framework Convention on Climate Change (UNFCCC) has set a common goal that reflects the scale of the financial efforts needed to effectively combat climate change. It recognizes a key piece of the puzzle in the fight against climate change and sends a strong signal about the need to examine all financial resources (public, private, national and international) and to ensure that they support and do not jeopardize the transition to a low-emission world of greenhouse gases resistant to climate change. The parties to the Paris Agreement – 183 countries since November 2018 – have pledged to “reconcile financial flows with a path to low greenhouse gas emissions and climate-resilient development” (Article 2.1 quater). This commitment is one of the three long-term objectives of the agreement, the other two (2.1a and 2.1b) focusing on limiting the rise in global average temperatures to a level well below 2 degrees Fahrenheit.