The United Nations Office at Geneva
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UNCTAD Press conference - 4 November 2024
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THE LEAST DEVELOPED COUNTRIES REPORT 2024 – Leveraging carbon markets for development
UN Trade and Development (UNCTAD) launched today the Least Developed Countries Report 2024 exploring how carbon markets can connect economic growth with climate action. By linking these goals, carbon markets offer a pathway to mobilize funds for sustainable development in the world’s most vulnerable economies.
DESCRIPTION
STORY: UNCTAD / Trade and Development Report
TRT: 03:09
SOURCE: UNCTAD
RESTRICTIONS: NONE
LANGUAGE: ENGLISH / NATS
WEBSITE: https://unctad.org/ldc2024
DATELINE: 04 NOVEMBER 2024, GENEVA, SWITZERLAND
SHOTLIST
1. Wide shot, exterior, Palais de Nations
2. Med shot, press room
3. SOUNDBITE (English) Rebeca Grynspan, UN Trade and Development Secretary-General : « Of the 20 countries that are most vulnerable to climate change, according to different studies, 17 are least developed countries. »
4. Med shot, speaker on screen, journalist, photographer
5. SOUNDBITE (English) Rebeca Grynspan, UN Trade and Development Secretary-General : « Financial gaps in LDCs are widening, and the investment deficit in these countries keep s getting worse. »
6. Med shot, press room
7. SOUNDBITE (English) Rebeca Grynspan, UN Trade and Development Secretary-General: « In short, carbon markets seek to solve a concrete economic problem: how to assign a price to something of high value to the planet but low value in the market. »
8. Med shot, journalists
9. SOUNDBITE (English) Rebeca Grynspan, UN Trade and Development Secretary-General: “As we approach COP29 in Baku next week, with a primary focus on climate finance, this report serves as a wake-up call on carbon markets.”
10. Med shot, journalist
11. SOUNDBITE (English) Rebeca Grynspan, UN Trade and Development Secretary-General: « LDCs play a minimal role in global greenhouse gas emissions, contributing less than 4% of the total. Yet, as mentioned, they face some of the most severe impacts of climate change. There is significant untapped potential in LDCs, with ample opportunities to create carbon credits through projects in forestry, agriculture, and renewable energy. »
12. Med shot, control room
11. SOUNDBITE (English) Rebeca Grynspan, UN Trade and Development Secretary-General: « Unfortunately, global carbon markets are currently divided and unclear. Carbon markets are fragmented due to a multiplicity of regulatory frameworks, standards and institutions, leading to a wide variation in carbon prices across different market segments. »
13. Med shot, journalist
14. SOUNDBITE (English) Rebeca Grynspan, UN Trade and Development Secretary-General: « A crucial factor for LDCs is establishing a viable carbon price, and the price proposed by UNCTAD’s study is at least $100 per tonne. However, the current price stands at just $10 per tonne. »
15. Med shot, journalists
16. SOUNDBITE (English) Rebeca Grynspan, UN Trade and Development Secretary-General: « We need a stronger push for harmonization across different standards and regulations. LDCs cannot—and should not— be forced to navigate a spaghetti bowl of climate regulations. »
17. Various shots
STORYLINE
As the world confronts intertwined climate and finance crises while seeking to advance on the Sustainable Development Goals (SDGs), carbon markets are increasingly seen as key drivers of climate ambition and capital flow.
They enable countries to trade carbon credits – permits to offset a specific amount of emissions – allowing sellers to earn revenue and contribute to climate action.
The least developed countries (LDCs) are already engaged in carbon markets and among the early movers in emerging trading mechanisms under Article 6 of the Paris Agreement.
The Least Developed Countries Report 2024 examines how these markets could bridge gaps between economic growth and climate action in LDCs and mobilize capital for sustainable development.
It makes clear that while carbon markets offer promise, they are not a substitute for official development assistance or climate finance. Instead, they serve as one of many tools to support LDCs’ green structural transformations and global emissions goals.
Using data-driven analysis and case studies, the report provides a roadmap for LDCs and their development partners to unlock the potential of carbon markets for sustainable growth.
Full report: https://unctad.org/ldc2024
Production date: 04 November 2024
Creator: UNCTAD
Subject topical: ECONOMICS
Corporate name: UN TRADE AND DEVELOPMENT – UNCTAD
Teleprompter
Good morning, Good morning everybody here and elsewhere connected.
Welcome to today's news conference on the launch of the Least Developed Countries Report 2024 by UN Trade and Development with us today with Secretary General Rebecca Greenspan, who will share key findings from the report.
And joining of course for further insights into the technical aspects is Mr Wolf Traeger.
He's Chief of Ongtal LDC Section in the Division for Africa, LDCs and Special Programmes.
He's the overall responsible as well for this publication.
Following their remarks, we'll open the floor for the questions.
You know the drill, name, outlet and whom you direct your question to.
Thank you very much, Secretary General.
[Other language spoken]
Thank you all for being here.
Let me start by asking or stating why this report matters now and let me try to give some context to it.
First of all, we go for COP 29, yes.
And so it matters because of that, because it's about carbon market and the least developed countries.
We need to shed light on the least developed countries on how carbon markets can be more effectively leveraged to support sustainable development and economic growth at the same time, particularly for these that are the most vulnerable countries.
In particular, carbon markets can help close one of the great paradoxes of sustainable development in least developed countries, the fact that they are, and let me quote here the UN Secretary General, Antonio Guterres.
And I quote, these countries are at the front line of climate disasters, but at the back of the line in terms of the resources they need to address and adapt to climate change.
End of quote.
Of the 20 countries that are most vulnerable to climate change according to different studies, 17 are I'll disease.
17 of the 20 countries that are most vulnerable to climate change are I'll diseased.
Least developed countries in financial gaps in LD CS are widening and the investment deficit in LDCs keeps getting worse.
So these are countries that are not closing the gap because we can say, OK, they are the most vulnerable, but gaps are, you know, shortening or know how to say are widening.
[Other language spoken]
But it will be good if we can say no gaps per seas, but they are decreasing.
But no, the gaps are widening.
So LDCs need around $462 million just in investments to get closer to the 7% growth rate that was established in the 2030 agenda.
So from the 45 LDCs, we have 45 least developed countries.
From the 45 LDCs, only one country, Rwanda is going to meet the target of the SDGS of 7% growth rate, only one.
And this is where carbon markets come in.
You know, carbon markets can bring much needed investment into the least developed countries, not only for climate action, but also for growth, for structural transformation more generally.
But first, we need to understand how come carbon markets work.
At their core, carbon markets are trading systems designed to reduce greenhouse gas emissions.
A company or individual investing projects that reduce emissions elsewhere to compensate for their own emissions.
This can include initiatives like renewable energy, reforestation, methane capture from landfills, and these projects generate carbon credit that can be sold in the market.
And that's how the carbon markets are created.
In short, carbon markets seek to solve a concrete problem of economics, how to give a price to that which has a **** value for the planet but a low value for the market.
So carbon markets have great potential in LDCs because they have much of these things, yes, foreigns, forest and tilt soles unworked, sun and wind uncaptured.
And this represent a huge opportunity for carbon removal and sequestration, offering the potential to generate substantial carbon credits and at the same time promote sustainable land use.
But to tap on these opportunities for the least developed countries, a lot has to be done.
Because as we approach COP 29 in Baku next week, whose main focus will be on climate finance, precisely this report is a wake up call on carbon markets.
Modest progress, but with a great potential ahead if we decisively support LDCs.
So what are the key findings of the report 2024?
So first, LDCs play a minimal role in global greenhouse gas emissions.
You know, they contribute less than 4% to total gas emissions.
However, as mentioned, they face some of the most severe impacts of climate change.
There is an uncap potential in the LDCSLDCS have significant opportunities to create carbon credits through projects in forestry, in agriculture and in renewable energy.
But unfortunately, global carbon markets are currently divided and unclear.
Carbon markets are fragmented due to multiplicity of regulatory frameworks, standards and institutions, which leads to a wide variation of carbon prices in different market segments.
So the complexity that have been developed because there is no not a unified framework, unified standards, unified institutions that you can go to.
So these fragmented global carbon markets are an obstacle in itself for untapping the potential of the LDCs.
And you know, we know that LDCs have less capacity to deal with this complexity than other countries.
And so they are, you know, hit twice for LDCs to.
So for LDCs to unlock their opportunities in these markets, they face pricing and access challenges that hinder their ability to fully engage.
A crucial factor for LDCs is establishing A viable carbon price and the viable carbon price that the study and the research from Antac is proposing is at least $100 per tonne, but the actual price is $10 per tonne.
So if we continue with this price per tonne for this a carbon market, we think that 97% of the mitigation potential of the LDCs contributing to mitigate climate change will remain untapped until 2050.
So that's too late if we are at the same time asking for COP 29 to have **** ambition or for COP 30 to have **** ambition.
Currently, as you can extract from my former statement, LDCs are utilising only 2% of their potential.
So huge way to go, huge opportunity.
But with the current conditions, it won't be taking a a, the opportunity won't come.
So what is another point that we stress in the in the report, since 2020, voluntary markets have become the primary source of new carbon credits for LDCs, focusing mainly on nature based solution.
52% comes from nature based solutions.
Renewable energy projects that present a great potential will cannot rely only on voluntary markets.
So we need more than voluntary market for this potential to be harvest.
And at the same time, as said before, the value of carbon credits generated by LDCs in 2023 was only 403 million, which is less than 1% Or for example, bilateral development aid.
This is like a drop in the ocean.
And the other problem that we have is market concentration, The significant concern of geographic concentration in the carbon, in the carbon credit market, only 6 cell disease from the four to five, only 6 cell disease really represent an important part of what goes to the LDCs, Bangladesh, Cambodia, Democratic Republic of Congo, Malawi, Uganda and Zambia.
So very good for these countries because they have done, they have been able to attract the benefit from the carbon market, although as I said still with a huge untapped a potential because of the limitations that they also face.
But the other 38 countries, 39 countries are basically not benefiting.
These six countries account for over 70% of all voluntary market credits and 80% of credits.
And under the CDM, this concentration limits opportunities for broader participation and benefits across the least developed countries.
So the way forward according to our recommendations is starting from the point that we know that many of the LD CS lacked infrastructure, the technology and institutional capacity needed for a meaningful participation in carbon markets.
So we need to strengthen domestic capacity and and that emphasise that strong domestic frameworks are essential.
LDCs need laws, regulatory capacity and monitoring sorry systems to fully leverage carbon markets while ensuring benefits reach local communities.
But we also need to expand international partnerships.
Effective global support for all disease in carbon markets require expanded partnerships, regional institutions and supportive climate frameworks.
The African Continental Free Day area is a clear example of an opportunity for regional institutions to really support LDCs in Africa, to have a better frameworks to untap the opportunities coming from carbon markets.
So collaborative approaches can lower transaction costs and increase the least developed countries positioning within carbon markets.
In particular, we need a stronger push for harmonisation across different standards and regulations.
LDCs cannot and should not be forced to navigate a spaghetti ball of climate regulations.
Now we have to also prioritise capacity building.
Building local expertise and infrastructure is critical.
Capacity building enables LDCs to integrate carbon market participation into their broader economic goals.
Distinguishing carbon finance also is important.
You know, we we need to be able to avoid the temptation of greenwashing of projects on or investors.
We know that the greenwashing have been really one of the factors that have weakened the participation of investors in a funds for sustainable development and for climate finance.
As you, I don't know if you remember, but last day when we launched the World Investment Report in 2023, we established that in 2023 there was a decrease of 60% of the new funds coming into the climate, the climate funds and the sustainable funds, a 60% decrease from investors in from new money, you know, to fund this, this for resources for these funds.
And this was mainly according to our research because of greenwashing.
So we need to have a clarity in how the projects in these countries are going to take place.
So they are not used for greenwashing projects that don't have really a value added to the objective and that will then repeat a pose A reputational risk for these for these countries possibilities to participate in the carbon markets.
So our main message, carbon markets are not a silver bullet but can support sustainable growth for LDCs.
Carbon markets alone won't solve the problem of development in this LDCs, but with the right reforms, they can provide supplementary financial support and a stepping stone to broader sustainable development.
We_that carbon markets can contribute to global climate action by unlocking the sustainable growth potential in the world most vulnerable economies.
With COP 29 in Baku starting next week, where we will also host an event on this topic, this report adds momentum to global climate action discussions.
Creating inclusive, effective carbon markets is essential to achieve both development and climate goals and may be part of a new architecture for climate finance underpinned by the new collective, quantifiable goal to be agreed in this COP 29.
This is an opportunity that leaders at COP cannot afford to overlook.
[Other language spoken]
[Other language spoken]
Thank you very much Secretary General for presenting providing the the key takeaways of this report, which of course kicks off our approach to to COP 29 and what UN trade and development will be addressing in Baku starting next week.
I now get the floor to our colleague Rolf Traeger for some additional more technical insights.
He has promised to keep them at layman's but interested people's and followers level.
So we all understand what he really wants to convey and then we open the floor for questions.
[Other language spoken]
Thank you, Marcellon.
Good morning, everyone.
So I'd like just to provide some further details to what the Secretary General has just exposed, which are the main findings and recommendations of the report.
And particularly this crucial question which the report seeks to answer, which is how to bridge these gaps.
And there are several gaps, gap gaps between economic growth and climate action, gaps between the cash with which international financial markets are awash and the huge financing gaps of these developed countries.
And as we have seen from.
The Secretary General's exposition.
There are huge gaps and quite often these, the carbon markets, they are presented to developing countries in general, but particularly to LDC's as a silver bullet, as a solution to all their financial problems.
But we have seen that this is not the case.
But how can we bridge the gap between the potential which is out there and the actual conditions under which LDC economies evolve?
So there are, as has already been mentioned, there are different actions which can and should be taken at different levels, both at the national level of the LDCs themselves, secondly at the regional level and 3rd at the level of the international community, particularly at the multilateral level since we are talking about Corp etcetera, etcetera.
So in turn, starting with the, let's say the priority actions and not necessarily actions, but attitudes of the least developed countries.
One particularly important point is that LDCs should have realistic expectations vis a vis carbon markets.
We have seen carbon markets are not a silver bullet.
They are not the solution to their financial and their needs for financing for development, but they can contribute there too.
And therefore it's important for these countries to have realistic expectations not to place all of their eggs on these markets as if they were going to solve the bulk of their needs for financing for development.
This is not going to happen.
It's going to be a contribution 2nd and sort of by the same token, is very important for these countries to carefully weigh the trade-offs which are involved in carbon market participation.
Because there is of course the positive side of raising finance and possibly contributing to climate action.
Both for their own sake, in terms of their own policies, their own contribution to combating climate change and thereby and indirectly giving a contribution to the global action against climate change.
Of course, keeping in mind the proportions and the small size of these economies, these are the economy.
And why is it so important to keep in mind these tradeoffs?
Because yes, there are the positive sides, particularly financing, providing, improving the environmental conditions of these countries, possibly community development, local development, possibly these projects may involve some sort of transfer of green technology towards these countries, which is something that these countries need dramatically.
But at the same time, there are pitfalls involved in participating in these countries.
And why is this the case?
Well, first of all, typically these projects, carbon projects, they are very long term.
So they can go for 5/10/15, twenty years or even beyond that.
So it's very important for the countries engaging in these projects to keep this time dimension in mind.
[Other language spoken]
Because these are contracts which are signed nowadays, but the engagements, the obligations which the countries assume by signing these contracts, by agreeing to these projects, they go over the long term.
So it's very important to be mindful of the long term consequences of the long term engagements into which these countries go by participating in these countries.
And there's another aspect, particularly in the case of nature based solutions, particularly in the case of forestry is that quite often the land which is involved in these projects is enormous.
In some cases it's as big as some countries like Belgium etcetera.
So whatever the country is making commitments to is making commitments, is engaging a big parts of its territory over which it will have restrictions on what national policy will be able to do or not to do.
So these are some of some of the examples of the tradeoffs that these countries need to take into account.
The Third Point as the Secretary General mentioned is the need to develop domestic institutions, laws, regulations, institutions like designated national authority, which is foreseen by the Paris Agreement, etcetera, etcetera, which is very important and poses a challenges because there's an element of learning, there's an element of capacity Bill, there's an element of costs as well.
Costs, institutional costs, financial costs, the need to build human resources, et cetera, et cetera.
And let's not forget that within while building these institutions, it's not just a matter of complying with what international obligations, say coming from UNFCCC or coming from the Paris Agreement or otherwise, but it's very important that the national goals of domestic policies are inbuilt into national legislations.
For instance, rules, rules for benefit sharing, These should be inbuilt in national legislation, which is a way of ensuring that whatever projects will be undertaken in those countries foresee or oblige, if you want some form of Fair benefit sharing, particularly with local communities, with sub regional areas etcetera.
And last but not least, it's also very important when building these institutions, when engaging in negotiations, when authorising these carbon projects, that the broader developmental objectives and instruments and priorities of each country are taken into account.
This means that yes, these projects are a way of raising finance, of complying with international obligations of these countries.
But at the same time, it's very important that these projects are built and foreseen as part of overall development policy making in these countries.
So, and I give you an example, which is renewable energy, which the Secretary General mentioned several times.
Why is renewable energy potentially at least a gain gain win win situation?
First of all, because these countries have an enormous deficit in terms of energy generation, transmission, etcetera.
Let's not forget that in 2/3 of the 45 LDC's, less than 2/3 of the population have access to electricity.
And I'm when I'm talking about less than 2/3, it couldn't be as little as 10 to 15% of the population who have access for electricity.
Which means that the demand for electricity, for energy in general is enormous.
And there there is a potential for for projects for carbon projects to provide part of the finance in in order to close these gaps.
As was mentioned at the beginning.
And here it's important not to think just about the well-being of the population, which is certainly very important and giving them access to electricity, but the role which energy supply and electricity can play in the structural transformation of the economy.
Let's not forget that the structural transformation is an essential condition for these countries to develop and to reach their development goals and to modernise the economies, to industrialise, to develop modern services, etcetera, etcetera.
Secondly, there is the regional dimension, which again was mentioned by the Secretary General.
And what is the rationale here?
The rationale is that all of these institutions, supervisory bodies, repository of projects, et cetera, et cetera, they are very costly.
They are very resource intensive for individual countries, particularly for small economies as is the case of most LDC's.
So thereby pooling regional resources provides an important opportunity for many of these countries to put in common their resources in order to make the best use of these markets.
And finally, I'd like just to make a couple of comments about action that international community can take in order to support the LDC's, make best use of the potential which is there in the case of carbon markets.
First of all, there is the issue of building capacities, as was mentioned by the SG and here I would say that it's very important to have a broad understanding of what it means to build the capacities.
It's not just an issue of building capacities of what rules you have to set up or what institutions, of what bodies, what measurement mechanisms.
Of course, this is very important.
But what is perhaps even more challenging is how to put together these technicalities of carbon markets together with the broad broader developmental objectives of these developed countries, of structural transformation of of the economies, etcetera, IE how to put carbon markets at the service of broader development goals, how to create synergies between these two processes.
Another point is not to conflate carbon finance with climate finance because there is a certain tendency, particularly in policy discourse, to shift responsibilities from climate finance to carbon finance.
And it's important to say that the treaties, the Paris Agreement, the UNF Triple C, they make it very clear that these are different things.
Carbon finance is the finance that countries can raise by implementing these projects and by engaging in in carbon markets, whereas climate finance is the finance which has been pledged, particularly by developed countries in favour of developing countries.
And they had, they started with the $100 billion a year, but now we are transitioning into a new regime as the Secretary General mentioned was the new quantified goal which is being negotiated now.
And finally, I'd like to finish by recalling the importance of taking into account the principle of common but differentiated responsibilities, which is both a new and F triple C and the Paris Agreement.
And this needs to be implemented when all of the rules which are still in the making for setting up these and the regulating these markets at the multilateral level.
These are negotiations on Article 61.26.4 of the Paris Agreement that special rules and special conditions are put in place in favour of the these developed countries.
And so I thank you very much for your attention.
[Other language spoken]
Thank you very much to both.
We open the floor for questions first from journalists here at the Palais.
Please, if you identify yourself and whom you direct your question.
[Other language spoken]
[Other language spoken]
Hi, Nina Larsen, AFP, Thank you for doing this briefing.
[Other language spoken]
[Other language spoken]
[Other language spoken]
Wondering as Secretary General.
If you could, you mentioned a lot of gaps and challenges including, you know the fact that these are voluntary markets and also about the greenwashing.
I mean there was a lot of stuff.
I'm just wondering how big do you see these challenges?
How optimistic are you that there will be some form of agreement on on moving forward on this and?
[Other language spoken]
Hoping that you could say something about the the failure at Kali to cross the finish line and how you see that in terms of these kinds of international negotiations and especially ahead of the.
Cop 29 if if you have.
Any thoughts around around that?
[Other language spoken]
Sorry, the biodiversity conference.
Can collect questions for the sake of efficiency as well.
We group them and then Yep.
[Other language spoken]
[Other language spoken]
[Other language spoken]
[Other language spoken]
It doesn't impact the.
The reply Thank you.
I will give the floor also to Ralph, but I think that greenwashing is a problem and it's a problem that cannot be solved only by the funds.
Yes, it will need transparency in the standards and appropriate institutions for the follow up for the certification and and evidence in terms of what the projects are doing and the we, we as Antec can help.
We have the standard also the Azar and I think that Azar will can take part of this.
They will have to be at more agreements in terms of transparency and accountability of these funds.
And it will be very important to regain the trust of the investment community because if you don't do that, so it will also be not only that investors will have less credibility, will go somewhere else, but that somewhere else may have nothing to do with the objectives of that we have set for ourselves for climate change.
And so diverting those resources from this objective is a problem in itself.
So I think that greenwashing has to be taken seriously, Yes.
The other problem in terms of the gaps is how do we developed the capacities of these countries to really take the right decisions.
And I think that the report says something very important.
This has to be part of your strategy as a country.
[Other language spoken]
It can help, but at the same time establishes obligations for you in the long run.
And I think that the rough may give a very good example on the some of these projects are as big as Belgium.
So you could be alienating, you know, part of a very important part of your territorial from a coherent national strategy.
So we need to help these countries to look at the big picture, yes, not only to develop the laws and the the standards and regulations, but also to have a coherent strategy.
And my Third Point is this does not replace the role of aid for these countries and financial, you know, access for development, it will never be enough because also they will have to comply with their own NDCS.
And so to comply with their own NDCS, you know that you cannot sell all the credits that your potential establishes because you will have also to participate in the entities in the international community.
[Other language spoken]
So in in the financial side, what we know is that they are not receiving investments at the scale that these countries need.
So the private sector alone won't make the trick the trick.
Yes, we will need the multilateral development banks really to come in here with guarantees, with risk reduction measures, with their own financial capacity to support LDCs, for a sustainable, coherent, sustain a development strategy for the future.
And this was also very clear in the TDR that we just launched.
Yes, in terms of how do we take finance to scale.
And I, I have to say that this a permanent dichotomy between private and public financing doesn't make sense because what we need is really, you know, both of them coming together in synergy.
One example that I give very often is what the World Investment Report said in his 2023 edition, that when you combine private investment with multilateral Development, Bank investment and government investment, the cost of capital goes down 40%.
So when you consider all this apart, you don't get the scale or you get an investment that is too expensive or a financing that is too expensive for these countries.
So, you know, being smart about this means you will need the international financial organisations, institutions to come to these countries and leverage the potential.
It won't happen only with private investment.
They will have to be able to address or address private investment to these countries, reducing the cost of capital interests.
[Other language spoken]
[Other language spoken]
In a way we are in a difficult moment, yes.
And we cannot be naive in the sense that we have a very polarised world and in a way you know.
Paris 2015 was a moment of hope.
We had the Paris Agreement, we had the SDGS, the SDG Agenda and the Agenda 20-30 but in there was this idea that we could go for a win win process.
We are again in the trade-offs narrative and mainly because you know you can have a win win if you have the financing for it, but if you don't have the financing for it, you just see the trade-offs.
Yes, and that's why this scope is so important because we need to go for a new finance target and and if we don't agree on it, the divide will grow and the trust on any process will grow.
I really believe the pact of the future, it was a hope moment also because there was consensus on very difficult issues that two years ago were impossible to be discussed in the international framework.
Yes, and examples of it is the international financial architecture reform in its governance and also the debt architecture reform.
So the processes to get a reform in the international financial architecture where a very important part of of the fact of the future and that I think that can unleash part of the financing that the developing countries need for us for sustainable growth and to be a positive and participants in the objective of the Paris Agreement.
But so it, you know, I see the challenges, but I also see that agreement is possible even in difficult areas like the Security Council reform in the UN.
[Other language spoken]
So I will expect or I will wish to see in in COP 29 a better.
Yeah, an attitude that will allow for some consensus around the quantifiable financial goal.
Obviously it will be very far away from the 100 billion initially stated.
Yes, the numbers are much higher and the the big question will be not only about the number, but how the financing will be composed.
[Other language spoken]
What will come from from the donor community, What will come from multilateral development banks, what will come from an effort of domestic resource mobilisation, what will come from the investment community?
That will be really the most important discussion in, in, in Baku and in COP 29.
And that together with the DNDC revision for 2040 COP 30, I think that is a good combination to regain momentum in the opportunities also for the South, for the developing countries, for the LDCs to tap into the opportunities A.
So I am cautiously optimistic.
[Other language spoken]
[Other language spoken]
[Other language spoken]
To be gentle, but maybe Ralph, you, you want to say something here, maybe when we wrap up.
So we we progress, but so being cautiously optimistic in terms of peeping also for time, I don't know if we have more here in the room.
[Other language spoken]
[Other language spoken]
So we go on to those connected online.
We see I see two hands at the moment.
Maya plans from the UN brief, please.
[Other language spoken]
[Other language spoken]
Thank you for taking my question.
My question is related to what the Mr Trauger mentioned earlier about if you could expand a little more on the question of how much we are confusing carbon finance, meaning mitigating the harms of carbon dioxide in the environment, and climate change, which seems a larger umbrella.
[Other language spoken]
So what is, I mean all both of these types of finance have to do with the issue of mitigating climate change, but the difference between them is the origin, the mechanics and how they are supposed to operate.
When we are talking about carbon finance, we are talking about the finance which is raised by the sale of carbon credits by setting up projects, et cetera, which are approved and are then sold in the markets, et cetera.
And there you have one challenge, which is that the market value of these projects is one thing.
The amount of this value which stays in the country is something else because typically these projects, particularly in the case of LDCs, are developed by foreign operators.
So it's not assure how much or what is the share of this value which stays in the country.
So this is 1 issue.
But this is the logic of carbon finance.
Whereas the climate finance is the one which was pledged back in in Paris in 2015 by developed countries as through different ways of financing climate action in developing countries.
And back then it was a value was put to it which was $100 billion a year.
But right now it's much higher than this.
So one thing is what the country gets by setting up these projects and getting some proceeds out of the sale of these carbon projects.
The other thing is how much the international community, particularly donor countries, have pledged to finance for climate action in developing countries.
This is quite independent of set, independent of setting up carbon projects and therefore the two of them should not be confused.
[Other language spoken]
[Other language spoken]
Thank you very much.
Well, if the Secretary General excuses herself, she had to leave for another pre scheduled engagement.
[Other language spoken]
We don't know whether there are any follow up questions either.
Hear from the room or.
Online they are not.
So again, thank you all for attending.
The report has been distributed.
[Other language spoken]
We have various assets as well.
This is again I reiterate what we said at the at the beginning, the first step as we are approach.
Oh, I have somebody online, but I don't see it.
Oh, Maya again, I think yes, Maya, sorry, I saw this was the old hand, but it's still it's a new, old and new.
[Other language spoken]
I had a question for the Secretary General.
[Other language spoken]
But perhaps Mr Trauger can expand on that to the concept of greenwashing.
We talk so much like the ESG know that banks, institutions.
Or.
Companies embarking on this trajectory where they self monitor.
So what you see is the possibility of creating some sort of framework.
Where are their frameworks that would help this companies into account and and how does that impact also when they go to this developed countries and pretend that they are doing good and they are just greenwashing?
If you could comment on that aspect of greenwashing mitigation.
[Other language spoken]
So, I mean, this was an issue which was already mentioned in a previous question and which is a major problem for the functioning of carbon markets because the carbon markets were launched around the well in their present form around the beginning of the century and there was lots of enthusiasm for them.
But later much reporting emerged on with accusations of greenwashing.
And what would be the case that claims are made that there has been, there have been abatement activities, that there have been and there has been mitigation through different projects, etcetera, etcetera, but which do not amount to reality or conversely that the same mitigation amount is counted twice by a private company, by the country, etcetera, etcetera.
And the problem of this is that these repeated accusations of greenwashing have taken away credibility of carbon markets, which largely explain both the falling carbon prices in international markets, but also the falling interests of international investors in particularly in the in the case of voluntary markets in these markets.
[Other language spoken]
Because these investors, they are motivated essentially by the will to Polish the agreement credentials to implement their ESG policies, environmental, social and governance policies, et cetera, et cetera.
But these policies only have credibility if the projects over which they are buying credits, they are credible, IE whether there is a real mitigation, whether this is properly monitored, whether this is properly measured, whether there is proper accounting and accountability for all of this system.
And all markets rely on some some sort of shared values understanding and credibility.
And the fact that there has been, there have been so many accusations of greenwashing has Hanford the functioning of these markets.
And that's why you have a number of initiatives in order to prevent greenwashing, in order to have serious standards of accountability, of measurement of the mitigation impact, etcetera, etcetera, of ensuring that the same mitigation activity is accounted properly, that it's not accounted twice.
And this is very important for the whole of the working of carbon markets because unless there is credibility in the working of these markets, there will be no demand for carbon credits.
And even the limited possibilities and potential which is there for LDC's will not be at their reach, will not be available to them.
So hence the importance of this international movement and particularly at the motor lateral level and principles which are being developed in order to enhance the credibility of these markets and to minimise if not eliminate greenwashing.
[Other language spoken]
[Other language spoken]
Apologies again if there are no further questions then as I said, this is the first of several steps.
As we approach Baku, we will be sharing more up to date information on all our engagements whilst in Azerbaijan.
The follow up questions also to the Secretary General, again had to leave before.
Please send them to us and we will get back to you during the week.
Thank you very much.