Climate Financing in the Philippines: Threats and Opportunities

Abstract

The Philippines is highly vulnerable to the effects of climate change, posing enormous risks to the people and economy. To address these vulnerabilities, it is critical for the Philippines to tap climate financing facilities so that it could develop climate resilience, build capacity to meet its climate objectives, and meet its Nationally Determined Contribution targets. To achieve these, the Philippines needs to address the threats and opportunities in the climate financing space. This covers the areas of policy frameworks; availability of climate financing; availability of project pipeline; capacity to meet climate financing requirements; and capacity to do climate expenditure tagging. There are several climate financing facilities from international financial institutions and multilateral development banks that are available, but the capacity to tap these is largely limited to the national government, with local government units needing to fully develop their capacity and project pipelines to tap into these. Capacity for climate budgeting to track and monitor climate expenditures has yet to be built, especially at the local levels. If the Philippines can address these, then it can tap the various emerging opportunities in climate financing.