The report provides an update to the IHLEG’s estimates for climate investment needs and presents an action plan to mobilize financing for emerging markets and developing countries (EMDCs).
The IHLEG projects a global climate investment requirement of $6.3–6.7 trillion per year by 2030, with $2.3–2.5 trillion needed in EMDCs (excluding China). Despite progress, private capital flows to EMDCs remain insufficient, requiring both greater speed and scale. Strengthening public-private collaboration will therefore be important to create investment plans and project pipelines. Moreover, expanding risk-sharing mechanisms and credit enhancements will help lower capital costs.
The report also highlights that reducing the cost of capital will require collaboration at the global and domestic level. Moreover, the structure of blended finance and other de-risking mechanisms will depend on factors like project maturity, technology, and macroeconomic conditions.
Additionally, non-traditional sources of concessional financing, such as voluntary carbon markets, special drawing rights (SDRs), solidarity levies, international taxes, debt swaps, and private philanthropy, could contribute up to $150 billion annually by 2030, helping to bridge the financing gap.
