Editing IPCC:AR6/WGIII/Chapter-16 (section)

=== 16.5.1 International Cooperation on Technology Development and Transfer: Needs and Opportunities ===

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With the submission of their Nationally Determined Contributions (NDCs) as part of the Paris Agreement, most developing countries are now engaged in climate mitigation and adaptation. While technology is seen as one of the ‘means of implementation’ of climate action, developing countries often have relatively limited technology innovation capabilities, which requires them to access technologies developed in higher-income countries with stronger innovation systems ( [[#Popp--2011|Popp 2011]] ; [[#Binz--2012|Binz et al. 2012]] ; [[#Urban--2018|Urban 2018]] ). In many cases, these technologies require adaptation for the local context and needs ( [[#Sagar--2009|Sagar 2009]] ; [[#Anadon--2016b|Anadon et al. 2016b]] ), and innovation capabilities are required to suitably adapt these technologies for local use and also to create new markets and business models that are required for successful deployment ( [[#Sagar--2009|Sagar 2009]] ; [[#Ockwell--2015|Ockwell et al. 2015]] ; [[#Ockwell--2016|Ockwell and Byrne 2016]] ). This can lead to dependencies on foreign knowledge and providers ( [[#Ockwell--2016|Ockwell and Byrne 2016]] ), negative impacts in terms of higher costs ( [[#Huenteler--2016a|Huenteler et al. 2016a]] ), balance of payments constraints, and vulnerability to external shocks ( [[#Ebeling--2020|Ebeling 2020]] ).

The climate technology transition can also yield other development benefits, for instance better health, increased energy access, poverty alleviation and economic competitiveness ( [[#Deng--2018|Deng et al. 2018]] ), including industrial development, job creation and economic growth (Porter and Van der Linde 1995; [[#Altenburg--2017|Altenburg and Rodrik 2017]] ; [[#Lema--2020|Lema et al. 2020]] ; [[#Pegels--2020|Pegels and Altenburg 2020]] ) ( [[#16.6|Section 16.6]] ). The growing complexity of technologies and global competition have made technology development a globalised process involving the flow of knowledge and products across borders ( [[#Lehoux--2014|Lehoux et al. 2014]] ; [[#Koengkan--2020|Koengkan et al. 2020]] ). For instance, in electronics production, Asian economies have captured co-location synergies and dominate production and assembly of product components, whereas American firms have adopted ‘design-only’ strategies ( [[#Tassey--2014|Tassey 2014]] ). In the context of renewable energy technologies, ‘green global division of labour’ has been observed, with countries specialising in investments in research and development (R&amp;D), manufacturing or deployment of renewables ( [[#Lachapelle--2017|Lachapelle et al. 2017]] ). In the case of solar photovoltaic (PV), for example, while many technical innovations emerged from the USA, Japan and China emphasised the manufacture of physical modules ( [[#Deutch--2013|Deutch and Steinfeld 2013]] ) (Box 16.4).

Such globalisation of production and supply chains opens up economic development opportunities for developing countries ( [[#Lema--2020|Lema et al. 2020]] ). At the same time, not all countries benefit from the globalisation of innovation – barriers remain related to finance, environmental performance, human capabilities and cost ( [[#Weiss--2013|Weiss and Bonvillian 2013]] ; [[#Egli--2018|Egli et al. 2018]] ), with developing countries being particularly disadvantaged at leveraging these opportunities. The gap in low-carbon technology innovation between countries appears to have reduced only among OECD countries ( [[#Yan--2017|Yan et al. 2017]] ; [[#Du--2019|Du and Li 2019]] ; [[#Du--2019|Du et al. 2019]] ) and the lower-income countries are not able to benefit as much from low-carbon technologies. For instance, in the case of agriculture, [[#Fuglie--2018|Fuglie (2018)]] notes that international R&amp;D spillovers seem to have benefitted developed countries more than developing countries. [[#Gross--2018|Gross et al. (2018)]] also argue that the development timescales for new energy technologies can extend up to 70 years, even within one country. They recommend that innovation efforts be balanced between early-stage R&amp;D spending, and commercialising already low-emission technologies in the demonstration phase and diffusing them globally.

Thus international cooperation on technology development and transfer can enable developing countries to achieve their climate goals more effectively, while also addressing other SDGs – taking advantage, where possible, of the globalisation of innovation and production ( [[#Lema--2020|Lema et al. 2020]] ). Earlier assessments in AR5 and SR1.5 have made it clear that international technology transfer and cooperation could play a role in climate policy at both the international and the domestic policy level ( [[#Somanathan--2014|Somanathan et al. 2014]] ; [[#Stavins--2014|Stavins et al. 2014]] ; [[#IPCC--2018b|IPCC 2018b]] ) and for low-carbon development at the regional level (Agrawala et al. 2014). The Paris Agreement also reflects this view by noting that countries shall strengthen cooperative action on technology development and transfer regarding two main aspects: (i) promoting collaborative approaches to R&amp;D; and (ii) facilitating access to technology to developing country Parties ( [[#UNFCCC--2015|UNFCCC 2015]] ). Furthermore, both in literature and in UNFCCC deliberations, South-South technology transfer is highlighted ( [[#Khosla--2017|Khosla et al. 2017]] ) as a complement to the transfer of technology and know-how from the North to the South.

This is consistent with literature that suggests that greenhouse gas (GHG) mitigation in developing countries can be enhanced by: (i) technology development and transfer collaboration and a ‘needs-driven’ approach; (ii) development of the specific types of capacity required across the entire innovation chain; and (iii) strengthening of the coordination and agendas across and between governance levels (including domestic and international levels) ( [[#Khosla--2017|Khosla et al. 2017]] ; [[#Zhou--2019|Zhou 2019]] ; [[#Upadhyaya--2020|Upadhyaya et al. 2020]] ).

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