The Long Term Finance Work Programme organised a “wrap-up session” in Songdo in South Korea from September 10th September 12th, with around 100 participants (governmental representatives, banks, civil society and the private sector) to take stock of progress made and outcomes of the work achieved throughout the various meetings and workshops (Makita, Bonn) this year.

The co-chairs presented their views on emerging themes in the pathway discussion:

i) the need to aggregate climate finance overall as it is difficult to attribute private finance flows to a particular country, ii) the need for transparency and consistent reporting of climate finance,
iii) the need for definitions that can operate within the UNFCCC and 100 billion context,
iv) the need for solutions with regard to budgeting climate finance to ensure more predictability year-on-year.

The co-chairs also highlighted that enabling environments were about ‘pushing’ (money out of developed country budgets) and ‘pulling’ (in developing countries by overcoming capacity issues and other barriers). In the breakout groups on resource mobilization, participants highlighted the role of regional development banks, the need for more transparency on the money that is flowing, the need for bottom-up work and capacity-building, the need for predictable and stable finance, the need to continue fast-start finance reporting until the biennal reporting is effective, the importance of demonstrating the extent of leveraged projects in developing countries to support plea for more climate finance.

Another breakout group highlighted the difficulty of separating mitigation and adaptation financial flows. In the discussions on enabling environments, the co-chair suggested that these environments should send clear policy signals through emission reduction targets or a carbon price. In this regard, some highlighted the important of internal climate targets for national and regional development banks to increase climate-compatible investments.

One of the groups identified the smaller economic actors as crucial as long as the cost of credit is lowered through concessional lending. Another highlighted the needs for education of private sector stakeholders, particularly local banks, to lower perceived risks. Groups pointed to the role of governments in levelling the playing field. Some parties suggested that adaptation finance should not only look at infrastructure and disaster risk insurance but also cover slow-onset impacts and loss and damage.

The co-chairs wrapped up the meeting with a series of high-level messages emerging from the work programme: aggregated climate finance levels are easier to measure, transparency on both deployment and effectiveness are key to trust-building, the is need to define key climate finance terms, national experiences are valuable lessons; country ownership is key also in measuring effectiveness of climate finance; there is need for coherence among existing institutions and processes; donor country public policies can drive private finance; donor countries can send strong signals through carbon pricing or stringent C02 targets. Parties discussed a potential continuation of the LTF work programme particularly to achieve mitigation goals.

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