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This report examines a toolkit of regulatory and economic policy instruments used to curb deforestation and promote forest restoration in tropical regions. It analyzes the effectiveness of command-and-control measures, financial incentives, and the critical role of land tenure security, while highlighting how political cycles and electoral incentives create risks for long-term conservation success.

This report by the Climate Policy Initiative analyzes the scale and diversity of the forest-climate nexus across 91 tropical countries. It quantifies forest extent, carbon stocks, and deforestation rates to argue for differentiated, fit-for-purpose policy strategies rather than a one-size-fits-all approach. The analysis concludes that there is no inherent trade-off between forest conservation and economic development.

Researchers from CPI/PUC-RIO developed a dynamic economic model to evaluate the additionality of REDD projects in the Brazilian Amazon, moving beyond traditional statistical baselines. The study finds that 77% of the carbon stock in these projects is additional, meaning it would have been emitted without the projects, avoiding 0.5 Gt of CO2 equivalent. However, additionality varies by region, with significantly lower rates in forested and isolated areas, such as Portel, Pará, where low agricultural productivity makes deforestation unlikely even without carbon credits. The report argues that while some non-additionality exists, the low price of REDD credits (US$ 5 to US$ 15 per ton) limits the financial impact of these discrepancies compared to other carbon pricing mechanisms.

The report introduces a dynamic economic model to determine the additionality of REDD projects in the Brazilian Amazon, finding that 77% of the carbon traded is additional. It highlights regional variations, noting higher additionality in agribusiness-consolidated areas and lower additionality in isolated regions like Portel, while suggesting that higher carbon prices would further increase additionality rates.

The report analyzes climate finance flows in Southeast Asia, finding a heavy reliance on international capital despite growing domestic interest. It focuses on Indonesia, the Philippines, and Vietnam, identifying that while corporates are the primary local investors, institutional and financial institutions remain underutilized due to risk perceptions and loan tenor mismatches. The document argues that blended finance—through guarantees, technical assistance, and project aggregation—can catalyze local investment in nature-based solutions, adaptation, and utility-scale renewables.

India's transition to electric mobility requires significant technology upgrades for automotive component MSMEs, who face structural barriers to affordable capital. CPI estimates that these MSMEs need INR 55,000 crore (USD 6.6 billion) in investment between FY2026 and FY2035 to maintain their industry share. To bridge this gap, the report proposes AC-TUFF, a blended-finance special purpose vehicle utilizing a tiered capital stack (first-loss, concessional, and commercial capital) and an integrated technical assistance wing. The facility aims to mobilize a total corpus of INR 5,000 crore to support the localization of EV components, which has a projected annual market potential of INR 3.86 lakh crore by FY2035.

Indonesia is the world's sixth largest methane emitter, yet investment in methane reduction remains critically low, with only USD 1.5 billion received against an estimated USD 2.5 trillion needed for the Agriculture and Waste sectors. The author proposes that the upcoming TKBI Version 3 (expected Q1 2026) should include granular technical screening criteria (TSC) for high-impact activities—such as leak detection and repair in fossil fuels, alternate wetting and drying in rice paddies, and anaerobic digestion in waste management—to make these projects bankable for private investors. By aligning with global benchmarks like the EU Taxonomy and the Singapore-Asia Taxonomy, Indonesia can pre-emptively meet international requirements, such as the 2024 EU Methane Regulation, and mobilize capital through its sustainable finance framework.

International climate finance for Brazil grew by 84% between the 2019–2020 and 2021–2022 biennia, reaching an average of US$ 5.1 billion per year. This growth was primarily driven by the energy sector, specifically solar and wind power, and was characterized by a shift toward commercial financing instruments. While Western Europe, led by France, was the largest regional provider, the AFOLU sector—responsible for most of Brazil's GHG emissions—received only 11% of the total finance. Public institutions provided 58% of the funds, with multilateral development finance institutions (DFIs) playing a dominant role, while private finance grew fourfold to reach 42% of the total.

International climate finance for Brazil averaged US$ 5.1 billion per year in 2021–2022, an 84% increase from the 2019–2020 period. This growth was primarily driven by the energy sector, particularly solar and wind power, and a significant rise in private capital from commercial financial institutions. While Western Europe was the largest regional provider, the report highlights a stark imbalance in sectoral allocation: the AFOLU sector, responsible for most of Brazil's GHG emissions, received only 11% of total finance. The majority of funds were earmarked for mitigation (80%) and delivered via commercial debt and equity, while grants and concessional finance declined by 43%.

International climate finance to Brazil averaged R$ 26.6 billion per year in 2021–2022, an 84% increase from 2019–2020. Growth was primarily driven by the energy sector, specifically solar and wind power, and a significant rise in private commercial financing. While Western Europe, led by France, was the primary source, the AFOLU sector—responsible for most of Brazil's emissions—received only 11% of total funding, mostly through public multilateral sources.

The report analyzes the complementary roles of VCEFs, MDBs, and NDBs in scaling climate finance, highlighting the potential for financial instruments like guarantees and catalytic equity to mobilize private investment. It identifies systemic barriers—such as complex accreditation and slow approval processes—and proposes a roadmap for non-financial collaboration through country platforms, technical assistance, and the creation of enabling policy environments. The document provides specific recommendations for the G20 Sustainable Finance Working Group to improve interoperability and leverage NDBs' local expertise to bridge the investment gap, particularly for adaptation in low-income countries.

The report evaluates 18 updated NDCs from non-Annex I countries using a new Climate Policy Initiative (CPI) framework focused on needs, design, and credibility. While some countries have improved their quantification of finance needs and integration with national plans, the report finds that most NDCs still lack the granular cost estimates and detailed implementation roadmaps necessary to effectively signal investment opportunities to private and public capital.

The document examines the 'PRA autodeclaratório' as a mechanism to overcome administrative bottlenecks in Brazil's Forest Code implementation, specifically the slow validation of CAR registrations. It analyzes experiences in Mato Grosso do Sul, Minas Gerais, Goiás, and Bahia, concluding that while the model can accelerate restoration, its success depends on robust post-execution monitoring, clear result indicators, and effective accountability mechanisms to prevent the underestimation of environmental liabilities.

The paper argues that while the quantity of climate finance is widely discussed, its quality—defined by its ability to catalyze transformational change—remains under-analyzed and non-standardized. It introduces a three-tiered framework for assessing quality: the project level (direct, measurable results), the market level (stimulating supply and demand for climate solutions), and the system level (structural shifts toward low-emission and equitable economies). The author defines 'transformational climate finance' as high-quality finance that moves beyond one-off projects to influence broader markets and systems. The document identifies ten dimensions for achieving this transformation and notes that while project-level measurement is common, market- and system-level indicators are currently limited among public providers. The goal is to foster global consensus and standardization of quality metrics to optimize the deployment of scarce public resources.

The document details the methodology used to quantify investment risks (governance, financing, physical climate, market, infrastructure, and nature) and attributes (horizon, ticket size, and return) for livestock in Latin America and the Caribbean (LAC). It establishes a scoring system to match these risks with the risk tolerances of various public and private investors, while modeling how different finance and policy strategies (IFS and IFPS) could improve investor suitability. The analysis distinguishes between small-scale farms (2-10 hectares) and large-scale commercial farms (10+ hectares) across Brazil, Argentina, Mexico, and the rest of LAC, noting that small farms are primarily served by public and concessional finance, whereas large farms have better access to commercial private finance.

The report identifies a massive funding gap for sustainable livestock in Latin America and the Caribbean (LAC), where the sector is responsible for approximately 28% of total regional emissions but receives minimal climate investment. It analyzes six key risk categories—governance, financing, physical climate, market, infrastructure, and nature—and finds that public investors are currently the most suitable for the sector due to higher risk tolerance. The roadmap proposes a transition from a 'business-as-usual' reliance on public funds to a diversified capital mix through blended finance, derisking tools (such as first-loss capital and credit guarantees), and policy reforms like natural capital accounting and improved land tenure. It specifically highlights the vulnerability of smallholder farms and the potential for large-scale farms in Brazil and Mexico to attract private investment. The report concludes with recommendations for COP 30 in Brazil to elevate sustainable livestock on the global climate agenda.

The report details a framework of seven indicators designed to evaluate how well non-Annex I countries communicate climate finance needs and strategies in their NDCs to attract private and international capital. The methodology employs a graduated scoring system from 'absent' to 'strong' to measure the 'investability' of these documents. As of May 31, 2025, the framework was applied to 18 non-Annex I parties, comparing their most recent submissions with previous ones to track progress in financial transparency and planning.

The Green Guarantee Group (GGG) argues that while guarantees are highly catalytic for mobilizing private climate finance in EMDEs, they remain underutilized due to regulatory barriers, high currency risks, data gaps, and institutional fragmentation. The report proposes clarifying the supervisory treatment of guarantees under the Basel Framework, developing local currency risk markets, expanding the Global Emerging Markets Risk Database (GEMs) to include guarantee performance, and strengthening national and regional guarantee platforms. These measures aim to support the goal of mobilizing USD 1.3 trillion annually by 2035 for EMDEs.

The document outlines a comprehensive framework for tracking global climate finance, focusing on real-economy investments in mitigation, adaptation, and dual-benefit activities. It defines a multi-layered taxonomy covering finance origins (domestic, international, indeterminate), actors (public, private, third-sector), and financial instruments. The methodology emphasizes a conservative approach to avoid double counting and carbon lock-in, utilizing a mix of primary project-level data and secondary market-sizing benchmarks from sources like the IEA and BNEF. Key 2025 updates include the integration of Luxembourg Green Exchange bond data, a new project-level hydrogen investment dataset, and the first-time inclusion of 2- and 3-wheeler electric vehicle sales in China and India.

The report analyzes the complementary roles of VCEFs, MDBs, and NDBs in the climate finance architecture, focusing on financial instruments like guarantees, equity, and local currency lending. It identifies systemic barriers such as complex accreditation and slow approval processes and proposes a framework for non-financial collaboration through country platforms, technical assistance, and the creation of enabling policy environments. The document provides a set of short- and mid-term recommendations to harmonize metrics, simplify due diligence, and unlock the potential of NDBs to increase the flow of climate finance to emerging markets and developing economies.