Editing IPCC:AR6/SR15/Chapter-5 (section)

=== 5.6.1 Finance and Technology Aligned with Local Needs ===

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Significant gaps in green investment constrain transitions to a low-carbon economy aligned with development objectives (Volz et al., 2015; Campiglio, 2016) <sup>[[#fn:r445|445]]</sup> . Hence, unlocking new forms of public, private and public–private financing is essential to support environmental sustainability of the economic system (Croce et al., 2011; Blyth et al., 2015; Falcone et al., 2018) <sup>[[#fn:r446|446]]</sup> (see Chapter 4, Section 4.4.5). To avoid risks of undesirable trade-offs with the SDGs caused by national budget constraints, improved access to international climate finance is essential for supporting adaptation, mitigation and sustainable development, especially for LDCs and SIDS ( ''medium evidence, high agreement'' ) (Shine and Campillo, 2016; Wood, 2017) <sup>[[#fn:r447|447]]</sup> . Care needs to be taken when international donors or partnership arrangements influence project financing structures (Kongsager and Corbera, 2015; Purdon, 2015; Phillips et al., 2017; Ficklin et al., 2018) <sup>[[#fn:r448|448]]</sup> . Conventional climate funding schemes, especially the Clean Development Mechanism (CDM), have shown positive effects on sustainable development but also adverse consequences, for example, on adaptive capacities of rural households and uneven distribution of costs and benefits, often exacerbating inequalities ( ''robust evidence, high agreement'' ) (Aggarwal, 2014; Brohé, 2014; He et al., 2014; Schade and Obergassel, 2014; Smits and Middleton, 2014; Wood et al., 2016a; Horstmann and Hein, 2017; Kreibich et al., 2017) <sup>[[#fn:r449|449]]</sup> ''.'' Close consideration of recipients’ context-specific needs when designing financial support helps to overcome these limitations as it better aligns community needs, national policy objectives and donors’ priorities; puts the emphasis on the increase of transparency and predictability of support; and fosters local capacity building ( ''medium evidence, high agreement'' ) (Barrett, 2013; Boyle et al., 2013; Shine and Campillo, 2016; Ley, 2017; Sánchez and Izzo, 2017) <sup>[[#fn:r450|450]]</sup> ''.''

The development and transfer of technologies is another enabler for developing countries to contribute to the requirements of the 1.5°C objective while achieving climate resilience and their socio-economic development goals (see Chapter 4, Section 4.4.4). International-level governance would be needed to boost domestic innovation and the deployment of new technologies, such as negative emission technologies, towards the 1.5°C objective (see Chapter 4, Section 4.3.7), but the alignment with local needs depends on close consideration of the specificities of the domestic context in countries at all levels of development (de Coninck and Sagar, 2015; IEA, 2015; Parikh et al., 2018) <sup>[[#fn:r451|451]]</sup> . Technology transfer supporting development in developing countries would require an understanding of local and national actors and institutions (de Coninck and Puig, 2015; de Coninck and Sagar, 2017; Michaelowa et al., 2018) <sup>[[#fn:r452|452]]</sup> , careful attention to the capacities in the entire innovation chain (Khosla et al., 2017; Olawuyi, 2017) <sup>[[#fn:r453|453]]</sup> and transfer of not only equipment but also knowledge ( ''medium evidence, high agreement'' ) (Murphy et al., 2015) <sup>[[#fn:r454|454]]</sup> .

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