Quantifying climate finance needs in the nationally determined contributions of developing countries

Climate finance is critical for developing countries to achieve the goals of the Paris Agreement. Understanding country-specific climate finance needs and priorities is therefore essential for the effectiveness of multilateral climate frameworks in facilitating climate finance flows to developing countries. The Nationally Determined Contributions (NDCs) that countries submit under the Paris Agreement provide information on national climate goals and sectoral priorities. While there is a huge literature on the transparency, accountability, and policy implications of NDC targets, less attention has been paid to the climate finance needs that developing countries communicate in their NDCs. Here, we propose a framework for measuring the specificity of developing countries’ climate finance needs and develop the Climate Finance Needs Specificity (CLIFS) dataset by manually analyzing 251 NDCs – 133 first and 118 updated NDCs. We measure the specificity of climate finance needs across mitigation and adaptation corresponding to the existence and the level of granularity of climate finance needs reported in these NDCs. Our results show an increase in the specificity of climate finance estimates between the first and updated NDCs for both mitigation and adaptation, and at the sectoral and sub-sectoral levels. African countries are more likely to quantify climate finance needs in their NDCs than countries from other regions. Based on data from sample countries, we find that estimated annual climate finance needs exceed $600 billion by 2030. This is double the amount pledged to the New Collective Quantified Goal (NCQG) on climate finance by 2035 and underscores the need for strong ambition in the implementation of the Baku to Belém Roadmap. We provide policy implications for various stakeholders, highlight the limitations of our study, and outline future research directions related to climate finance and policy. There are variations in the specificity of climate finance needs in the NDCs of developing countries that cannot be easily explained by factors such as economic development.Technical assistance and capacity building initiatives such as the NDC Partnership should pay more attention to quantifying adaptation-related climate finance needs due to the greater challenges faced by developing countries.Policymakers in developing countries should establish a strong institutional framework to coordinate sectoral ministries and stakeholders to enable high-quality quantification of climate finance needs in NDCs.The New Collective Quantified Goal (NCQG) on climate finance of $300 billion per year by 2035 is insufficient to meet the climate finance needs of up to $600 billion estimated in our dataset based on NDCs from developing countries with quantified climate finance needs. This requires strong ambition in the implementation of the Baku to Belém Roadmap. There are variations in the specificity of climate finance needs in the NDCs of developing countries that cannot be easily explained by factors such as economic development. Technical assistance and capacity building initiatives such as the NDC Partnership should pay more attention to quantifying adaptation-related climate finance needs due to the greater challenges faced by developing countries. Policymakers in developing countries should establish a strong institutional framework to coordinate sectoral ministries and stakeholders to enable high-quality quantification of climate finance needs in NDCs. The New Collective Quantified Goal (NCQG) on climate finance of $300 billion per year by 2035 is insufficient to meet the climate finance needs of up to $600 billion estimated in our dataset based on NDCs from developing countries with quantified climate finance needs. This requires strong ambition in the implementation of the Baku to Belém Roadmap.