The conference focused on the transition to a more efficient, less polluting economy and on reducing the use of natural resources to achieve sustainable development. This will be done by pursuing financial strategies and plans for the implementation of Mexico’s Nationally Determined Contribution (NDC).

Representatives from the National Institute of Ecology and Climate Change (INECC) commented that the cost estimate of the NDC is a commitment assumed by Mexico in order to contribute to the objectives of the Paris Agreement. The NDC aims to reduce emissions and prepare for climate change impacts. These strategies affect the country’s energy agenda.

To achieve these goals, two main changes are required: first, Mexico needs to transition towards an economy based on investments favoring the use of efficient energies; second, it needs to transform its financial system for the efficient reallocation of resources. As shown in figure 2, the plan to reduce emissions involves decreasing emissions in eight sectors.

The Ministry of the Environment and Natural Resources (SEMARNAT) presented the breakdown of how much each sector will have to contribute to reach the target of reducing greenhouse gases (GHGs) by 22%; the largest contributors are the transport and electricity generation sectors. The percent contribution of the reforestation for land-use sector is also significant for achieving the target.

The investments and financing analyzed provide an investment opportunity that could help transition to a low-carbon economy. Representatives from the Private Sector Studies Commission for Sustainable Development (CESPEDES) discussed the need for private sector financing, which requires long-term public policy, transversality between government agencies and their different levels, synergy between public policies, banking projects, private investment and competitive financial schemes. In addition, climate financing flows should be monitored to identify needs.

The World Wildlife Fund (WWF) presented on the different forms of financing and obstacles. For example, as the costs of renewable energy sources have decreased, their infrastructure has improved; however, attractive projects and regulated markets suitable for low-carbon investments are lacking. Currently, only 5% to 10% of bank loans are green, and there is no jurisdiction to establish a sustainable financial system.

SEMARNAT’s plan for implementing the NDCs also includes steps to reduce the vulnerability of strategic infrastructure. It is essential to prioritize the potential for emissions reduction and ensure profitability for investors, as well as to facilitate implementation and reduce investment costs. In conclusion, the climate change issue has already been incorporated into the government’s agenda, but financial institutions should now be involved to reduce the existing financing gap.

This conference was organized by the ITAM Energy and Natural Resources Center and the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH.