The report comes as countries around the world scale up action to curb climate change. Mitigation policies are on the rise, including carbon pricing policies, with 75 carbon taxes and emission trading schemes currently in effect worldwide, covering approximately 24 per cent of global emissions.
Published by UN Trade and Development (UNCTAD), the World Trade Organization, the International Monetary Fund, the Organisation for Economic and Co-operation for Development and the World Bank, the report outlines pathways for coordinated approaches on climate action, carbon pricing and the cross-border effects of climate change mitigation policies, with a view to achieving global climate goals.
The report stresses the need to step up climate action to meet global emission reduction targets, while contributing to broader development goals. It makes four important contributions to that end:
- It provides a common understanding of carbon pricing metrics to improve transparency on how countries are shifting incentives for decarbonization.
- It examines the composition of climate change mitigation policies, emphasizing the important role of carbon pricing as a cost-effective instrument that also raises revenues.
- It outlines how international organizations can support the coordination of policies to foster positive and limit negative cross-border spillovers from climate change mitigation policies. It also analyses the advantages and disadvantages of carbon border adjustment policies, including their impact on developing countries.
- It shows how such coordination can help to scale up climate action by closing the transparency, implementation and ambition gaps.
The report makes clear that international organizations' future work can help fill important knowledge gaps. These include a need for more granular and better data on embedded carbon prices and embedded emissions, the design of border adjustment policies and their interoperability, and other approaches to enhance cooperation to increase ambition and ensure a just transition for all.