EC believes mobilising $100 billion per year by 2020 for climate actions “can be done”

Raising $100 billion per year by 2020 in developing countries “will be challenging but it can be done” according to a European Commission staff working document on "Scaling up international climate finance after 2012". The staff working report also states that it is possible if the right balance is struck between public funding, funding raised from international carbon markets, as well as private funds, partly leveraged by development banks.

This assessment is based on the report by the UN Secretary-General’s High-level Advisory Group on Climate Change Financing (AGF) presented in November 2010. It broadly confirms the report's overall conclusion that it will be "challenging but feasible" to meet the goal of mobilising $100 billion per year by 2020. Several of the public sources related to carbon pricing assessed in the AGF report are already in place in the EU or will be increasingly used in the next years. Other public sources, such as taxes on international maritime and aviation transport, or on financial transactions, would require more global cooperation. Multilateral and other development banks can further leverage these sources of climate finance.

In the international climate negotiations in Cancún held in December 2010, developed countries committed themselves to a goal of jointly mobilising $100 billion per year by 2020 to developing countries if they take transparent and meaningful action for reducing emissions. The ECOFIN Council invited the Commission to assess and prepare a detailed analysis setting out the key elements needed. The Joint EFC/EPC Working Group on International Financial Aspects of Climate Change will further discuss this issue and report to ECOFIN ministers.

In addition, the EC staff working document also examines how to ensure that funds raised and channelled to developing countries can be spent within a sound governance framework which ensures an efficient use of the additional money. Therefore, strong international and European coordination is required on the governance aspects and on the delivery, including a fair international burden-sharing among developed countries, the scaling-up from 2013 to 2020, as well as the "measurement, reporting and verification" (MRV) of financial flows. The EU budget after 2013 could take a more prominent role in channelling EU climate finance to developing countries.