The high-level conference co-organized by C3A, the World Bank, with the Ministry of Finance of Brazil and the Economic Commission for Latin America and the Caribbean (ECLAC), with the support of the Euroclima program, brought together a network of experts, scientists, regional economic leaders and professionals. Its objective was to address the challenges posed by the transition towards sustainable practices in a difficult global and regional macroeconomic context. Key issues discussed include the integration of climate considerations into economic, financial and fiscal planning, the mobilization of financial resources for sustainable projects and the coordination of efforts between different actors, including the private sector, to respond effectively to the socio-environmental challenges.
“There is an urgent need to develop coordinated and strategic responses to the region’s limited fiscal space and significant structural and institutional challenges,” said Santiago Lorenzo, Head of ECLAC’s Climate Change Unit.
The event highlighted the high incidence of extreme weather events that affect the region due to its biological diversity and geographical location, which requires rapid and effective responses to minimize negative effects on local communities and economies. Participants examined how structural challenges, limited institutional response capacity, and dependence on highly polluting sectors complicate climate change management. The discussions emphasized strengthening public institutions, improving technical capacities and allocating financial resources for the implementation, monitoring and evaluation of climate policies. The importance of international cooperation to jointly address these challenges was also highlighted.
A critical issue discussed was the difficulty of accessing global climate finance, compounded by asymmetries in access to financial instruments and budget constraints. Participants stressed the need for new regulatory frameworks and innovative financial architectures to integrate public and private international funds. The importance of aligning climate change agendas with local government actions and financial mechanisms to ensure effective policy implementation was also emphasized.
Many Latin American countries have implemented policies to address climate change and the green, sustainable and fair transition, such as the issuance of green and/or sustainable bonds, the diversification of the energy matrix and the creation of climate funds to mobilize resources for sustainable projects. Discussions on new financial instruments for climate and nature marked another relevant moment of the event, emphasizing the alignment of environmental and financial objectives for long-term sustainability.
Participants recognized a general lack of knowledge about the macroeconomic scope of climate change and its implications, highlighting the need to improve the offer of research and specialized studies in the region. Presentations on climate scenarios and modeling tools showed that while the transition to a low-carbon economy can be costly, the long-term costs of inaction would be even greater.
“To make informed decisions that align socioeconomic outcomes with climate objectives, Finance Ministries need advanced analytical tools. It is time to innovate our approach to climate policy analysis,” said Etienne Espagne, co-director of the C3A Program.
An important takeaway from the conference was the need to match the timelines of academia with those of decision-makers, while building capacity and knowledge in ministries to create effective public policies that balance both mitigation and adaptation to the climate crisis and its impacts.
Ultimately, the conference illustrated the preference for an integrated approach that combines effective policies, financial innovation and strong cooperation between academia, governments and the private sector. This approach helps make climate strategies effective and equitable, addressing both immediate and long-term economic needs in the fight against the climate crisis.
Finally, the event highlighted the urgency for the Ministries of Finance of the Latin American and Caribbean region to undertake comprehensive actions, including the conservation of biodiversity and the sustainable management of ecosystems. These efforts must be coordinated at the national and international level to address the challenges of climate change and must consider scenario models adapted to the economic and structural characteristics of each country. The event concluded with a call to action to strengthen international cooperation, improve understanding of the interdependence between the real and financial spheres, and develop appropriate structural solutions to address both the climate crisis and social and economic inequality in the region.
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