The Conference of the Parties,
Recalling Articles 4 and 11 of the Convention,
Also recalling decisions 12/CP.2, 12/CP.3, 1/CP.16, paragraph 112, 2/CP.17, paragraphs 120–121, 5/CP.18, 5/CP.19, 7/CP.19, 6/CP.20, 6/CP.21, 8/CP.22, 7/CP.23, 8/CP.23, 4/CP.24, 11/CP.25, 5/CP.26, 5/CMA.2 and 10/CMA.3,
Taking note of decision 14/CMA.4,
1. Welcomes the 2022 report of the Standing Committee on Finance;
2. Also welcomes the fifth Biennial Assessment and Overview of Climate Finance Flows of the Standing Committee on Finance and the summary, and takes note of the recommendations contained in the annex;
3. Notes that climate finance flows in 2019–2020 were 12 per cent higher than in 2017–2018, reaching an annual average of USD 803 billion, driven by investments in energy efficiency of buildings, sustainable transport and adaptation; the 2019–2020 annual average of public financial support reported by Parties included in Annex II to the Convention in their biennial reports (USD 40.1 billion) represents an increase of 6 per cent from the annual average reported for 2017–2018; the annual average of climate finance from multilateral development banks to developing countries and emerging economies3 (USD 45.9 billion) represents a 17 per cent increase since 2017–2018; and UNFCCC funds and multilateral climate funds committed USD 2.9 billion and USD 3.5 billion for climate finance projects in 2019 and 2020 respectively;
4. Notes with concern that global climate finance flows are small relative to the overall needs of developing countries;
5. Also notes with concern that, despite the clear increasing trend in global climate finance flows, they remain at a relatively low level in the broader context of other finance flows, investment opportunities and costs;
6. Encourages Parties to the Convention to consider implementing the recommendations referred to in paragraph 2 above, as appropriate;
7. Acknowledges the improvement in quality, transparency and granularity of information in the fifth Biennial Assessment while recognizing that data limitations persist, particularly in relation to private climate finance, including private finance mobilized by developed country Parties through bilateral and multilateral channels, and finance in sectors other than energy and transport, and requests further work in this regard in the sixth Biennial Assessment, including in relation to data by region, private finance mobilized from public interventions and financing arrangements relevant to averting, minimizing and addressing loss and damage;
8. Stresses the importance of reporting on climate finance provided, mobilized, needed and received at both the activity and country level, and of enhancing methodologies for measuring and reporting on the results and impacts of climate finance;
9. Notes that the work of the Standing Committee on Finance on definitions of climate finance4 shows the variety of definitions in use;
10. Also notes the complexities associated with the diversity of definitions of climate finance in use by Parties and non-Party stakeholders in relation to ensuring clear, aggregated accounting and reporting of climate finance;
11. Requests the Standing Committee on Finance to prepare a report for consideration by the Conference of the Parties at its twenty-eighth session (November–December 2023), building on the Committee’s work on definitions of climate finance, on clustering types of climate finance definitions in use that could be considered within the UNFCCC process, including with a view to updating the Committee’s operational definition of climate finance, as appropriate, and supporting Parties in their national reporting efforts and invites Parties and external stakeholders to make further submissions thereon via the submission portal5 by 30 April 2023;
12. Notes the report prepared by the Standing Committee on Finance on progress towards achieving the goal of mobilizing jointly USD 100 billion per year to address the needs of developing countries in the context of meaningful mitigation actions and transparency on implementation;
13. Notes with concern that the draft guidance for the operating entities of the Financial Mechanism prepared by the Standing Committee on Finance7 was not utilized by the Conference of the Parties and in this regard requests the Committee to improve its working modalities for preparing the draft guidance for the operating entities of the Financial Mechanism;
14. Expresses its sincere gratitude to the Government of Australia for its support in ensuring the success of the second part of the Standing Committee on Finance Forum on finance for nature-based solutions and notes with appreciation the high-level summary thereof, without prejudice to other multilateral processes, and welcomes the Forum’s specific focus on indigenous peoples and knowledge;
15. Also welcomes financing just transitions as the topic for the Standing Committee on Finance Forum in 2023;
16. Expresses its appreciation to the Governments of Australia and Germany and to the European Commission for their financial contributions to support the work of the Standing Committee on Finance;
17. Endorses the workplan of the Standing Committee on Finance for 20239 and underlines the importance of the Committee focusing its work in 2023 on its current mandates;
18. Welcomes the efforts of the Standing Committee on Finance to continue to strengthen its engagement with stakeholders in the context of its workplan, including UNFCCC constituted bodies, private entities and other entities outside the UNFCCC, and encourages the Committee to continue such efforts in 2023;
19. Also encourages the Standing Committee on Finance to continue to enhance its efforts to ensure gender responsiveness in implementing its workplan and requests Parties to consider gender balance and geographical representation when nominating members to the Committee;
20. Encourages the Standing Committee on Finance to take further steps to accurately, adequately and equitably reflect the views of Parties in its future reports and ensure that those views are presented in a balanced manner that reflects their diversity;
21. Requests the Standing Committee on Finance to report to the Conference of the Parties at its twenty-eighth session on its progress in implementing its workplan for 2023;
22. Also requests the Standing Committee on Finance to consider the guidance provided to it in other relevant decisions of the Conference of the Parties.
