Research Insights: How Much Will It Cost to Achieve the Climate Goals in Latin America and the Caribbean?
Meeting the climate change challenge requires structural transformations in infrastructure, health and social protection, and financial institutions. Climate action calls for a redirection of existing financial flows. An adequate response requires redirecting financial flows to achieve annual spending of 2 to 8 percent of GDP on the provision of infrastructure services and 5 to 11 percent of GDP on social programs. Specific financing sources, such as green taxes and sustainable bonds, can finance part of climate efforts. However, to redirect public and private spending and foreign investment into solutions consistent with climate goals, governments will also need to reform policies and regulations in all sectors.