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LATIN AMERICA WORKS ON PLANS FOR EMISSIONS REDUCTIONS

A series of successful summits between Latin American business and political leaders in early 2015 creates real opportunities to actualise sustainability-related microfinance schemes in Latin America.

Building on the Lima Call for Climate Action, and in sight of the Paris climate summit that will be held at the end of 2015, a series of meetings between Latin American leaders has started with the aim of creating functional and market-based mechanisms to accomplish “intended nationally determined contributions” of emissions reductions. In fact, one of the UNFCCC’s targets for the Paris summit is precisely to create sustainable finance and investment networks for businesses in developing countries and to agree a legally binding global agreement on emissions reductions.

From February 24 to 26, in Mexico City was held the fourth annual Latin American Impact Investment Forum (FLII). Within this meeting, participant environmental enterprise ventures are offered the chance to compete for the finances coming from the $10 billion UNFCCC’s Green Climate Fund and for the $3.5 billions the Inter-American Development Bank (IDB) has made available for environmental sustainability and renewable energy projects in the private sector.

Finance networks that focus on sustainable development ensure long-term financial viability, and are therefore advantageous for small enterprises and risky ventures that normally couldn’t compete for financing in open capital markets, as they don’t have demonstrable credit-worthiness or collateral sable assets.

It is yet to be seen whether these investment commitments will sufficiently speed up sustainability entrepreneurship and environmental impact, but what is sure is that Latin American businesses will require a lot more financing than the current contribution of investment networks in order to achieve actual results in tackling climate change, especially considering that lately Latin America has developed solid trade and investment relationships for non-renewable energy sources with China.

 

The gLAWcal Team

POREEN project

Monday, 30 March 2015

(Source: Renewable Energy World)