Significant financial resources will be needed to help developing countries deal with climate change.
The EU is the world's largest contributor of climate finance to developing countries and increasingly integrates climate change into its broader development strategy.
The EU and its Member States are also the world's leading aid donor, with collective official development assistance representing 0.51% of EU Gross National Income in 2016.
While continuing to invest in domestic climate action, the EU is scaling up climate finance to help the poorest and most vulnerable countries mitigate and adapt to climate change.
In particular, in the period 2014-2020:
In 2016, total contributions from the EU, its Member States and the European Investment Bank (EIB) amounted to €20.2 billion, a significant increase compared to 2015. This includes climate finance from public budgets and other development finance institutions.
The main channel for EU support to policy dialogue and specific, targeted climate action in developing countries is the Global Climate Change Alliance Plus (GCCA+).
Active since 2008, GCCA+ has invested so far close to €450 million in more than 60 country-based and regional actions.
The overall objective is to foster policy dialogue and cooperation on climate change between the EU and developing countries.
The GCCA+ has a strong focus on Least Developed Countries and Small Island Developing States (SIDS) as they are most vulnerable to climate change.
The EU will mobilise innovative financial instruments, with particular focus on the EU External Investment Plan, to support the preparation and financing of bankable climate relevant development projects.
The plan will encourage investment in the EU's partner countries in Africa and the EU Neighbourhood region.
With a contribution of €4.1 billion from the European Commission, the plan is expected to leverage more than €44 billion of investments by 2020.
It will promote inclusive growth, job creation and sustainable development and so tackle some of the root causes of irregular migration.
European Fund for Sustainable Development (EFSD)
The EU remains committed to contributing towards the developed countries’ goal of jointly mobilising from different sources USD 100 billion per year by 2020 to support developing countries.
As part of the Paris Agreement, this goal was extended until 2025, prior to which a new collective goal will be set.
The funding will come from a wide variety of sources – public and private, bilateral and multilateral, and alternative sources of finance – in the context of meaningful mitigation action and transparent implementation by developing countries.
The EU is calling for emerging economies to also contribute in line with their respective capabilities and responsibilities.
In 2016, the EU and its Member States together with the other donors presented a Roadmap to US$100 Billion. According to the roadmap, the public finance together with private finance it directly mobilises will increase to close to USD 100 billion in 2020, compared to an average of USD 41 billion over 2013-14.
The Green Climate Fund (GCF) was set up in 2010 to support developing countries in reducing their greenhouse gas emissions and adapting to climate change.
Since 2014, it has gathered pledges worth USD 10.3 billion. EU Member States have pledged nearly half of these: USD 4.8 billion.
Some EU Member States and Regions also contribute about 95% of the annual voluntary pledges to ensure the functioning of the Adaptation Fund.
Countries need to attract additional public and private financing to transition to a climate-friendly economy and drive sustainable economic growth.
International climate finance should be used as a lever to incentivise climate-resilient and low-carbon investments, complementing domestic resources in developing countries.
The EU's approach is twofold:
For example, the EU and Member States have established a number of blending facilities that combine grant funding with loans, covering different regions.