VIRTUAL BROADCAST

The ongoing reform of the international financial architecture is placing PDBs in the spotlight as key players in helping mobilise and channel resources towards a just and orderly transition in line with country priorities. Yet, to leverage their value-added, collaboration is needed at national and international level. There has been little inter-PDB cooperation on climate finance to date and several differences between international and domestic PDBs have hindered their alignment and collaboration on financing the Paris Agreement goals.

Complementary taxonomies, country platforms, and strengthening capacity-building and knowledge-exchange initiatives can be pivotal to strengthening PDBs activities that are aligned with national priorities.

In particular, country platforms are increasingly being seen as part of the solution to catalysing different sources of finance and supporting the alignment of international financial flows with national priorities and climate objectives.

This event highlights several key mechanisms/actions which can be instrumental to improve the country-level impact of international climate and development finance, and the associated conditions for success.

The session aims to explore the critical interlinkages between the International Financial Architecture (IFA) reforms and the New Collective Quantified Goal (NCQG) for climate finance, particularly in the context of emerging markets and developing economies. The objective is to foster a deep understanding of how ongoing reforms to global financial systems can be leveraged to enhance the quality and quantity of climate finance, ensuring alignment with the Paris Agreement goals.

The session will:

• Examine the current progress and challenges in IFA reforms, including PDBs, debt relief mechanisms, international taxation, and levies, and how these can contribute to climate finance.
• Discuss the NCQG negotiations and its potential that address the climate finance quantum and sources, including public, private, and mobilized finance.
• Analyse how the PDB ecosystem can contribute to the NCQG and disseminate mechanisms like debt-for-climate swaps, Special Drawing Rights (SDR) rechannelling, and other innovative financial mechanisms in a reformed global financial architecture.

The objective is to allow supporting institutions to learn from each other’s respective experiences with Paris alignment and latest research on how to improve their Paris alignment.

The objective is to share new insights on the nexus Trade & Development, in particular opportunities for PDB to design program in concertation with international brands and retailers.

Small and Medium-sized Enterprises (SMEs) play a critical role in driving economic growth and employment globally. However, from an aggregate perspective they also contribute significantly to carbon emissions, which impacts climate change efforts. Public Development Banks (PDBs) are uniquely positioned to support SMEs in adopting sustainable, low-carbon practices through innovative financing, capacity-building initiatives, and technical assistance. By providing tailored solutions, PDBs can empower SMEs to transition towards greener business models, reducing their environmental footprint while enhancing resilience and productivity.

At COP29, this panel will gather leading PDBs to explore strategies for enabling and accelerating SME decarbonization. The discussion will underscore the importance of public-private partnerships, sharing of best practices, and tailored financial mechanisms to foster green transitions among SMEs worldwide.

This high-level side-event will be the opportunity to present IDFC contributions to Climate finance, in particular the Green Finance Mapping 2023, and to illustrate the role of public development banks to achieve Paris Agreement alignment.

IDFC also aims to promote the role of public development banks and to contribute to the international agenda and debates on climate, for instance on the New Collective Quantitative Goal (NCQG) or on the different approaches for financial institutions to align on the Paris Agreement.

Objective

Based on an overview of IDFC main deliverables this year, this side-event will explore ideas to go beyond in the coming years to meet Paris Agreement Goals. What IDFC can bring to the post-2025 agenda?

The aim of this event is to share feedback on project implementation challenges to improve the deployment of GCF resources.

Panelists will present their different experiences and lessons learned from the implementation of projects financed by climate funds.

Fostering collaboration among financial stakeholders, and collectively working on a better and differentiated characterization of financial flows according to their qualitative contribution to the above challenges (“traditional” climate finance, Paris-aligned finance, transformational finance for climate) are also essential.

The event will interactively discuss all of the above and sketch next steps for the continuation of a whole-of-finance effort towards its systemic transformation for low carbon and resilient sustainable development.

This session will explore the operationalization of Article 6 of Paris Agreement, focusing on innovative market mechanisms that can enhance climate finance, including carbon credits. PDBs (Public Development Banks) as enablers can provide financial and technical support to foster Article 6 projects, acting as a bridge between government policy and private sector engagement.

The session will present frameworks and financial instruments (e.g. blended finance, loan guarantees) needed to support Article 6 implementation and the issuance of carbon credits. The discussion will also cover the co-benefits integration of sustainable development goals, transparency mechanisms and capacity building to ensure efficient and reliable carbon markets, based on practical examples of projects enabling and allowing the issuance of carbon credits and the inclusion of institutional framework for carbon markets.

On February 6, 2023, two earthquakes, among the most devastating of the 21st century, struck the South-East of Türkiye, affecting 17 provinces, causing more than 50,000 victims and collapsing more than 200,000 buildings. Total financial burden of the disaster is estimated at USD 103.6 billion.

As part of the mobilisation of international aid, and relying on their long-term partnership within IDFC, TSKB, AFD and CDP proposed to support the region’s industrial sector While evaluations of the damages highlight the dramatically deleterious impact of earthquakes on long-term economic prosperity; they also identify “green infrastructure investments” as a priority in the reconstruction phase in order to support Türkiye’s sustainable and low-carbon development trajectory.

The side-event will present the genesis of an IDFC collaboration in an emergency context, which allowed TSKB to mobilise 100 M EUR for a green reconstruction in the earthquake region.