This guide is a tool that establishes viable financing alternatives for subnational governments to develop a financial architecture that contributes to the implementation of their climate change policy.

For several years, states in Mexico have made efforts in the construction of climate policies that support the implementation of mitigation measures and adaptation to climate change in their territories. One of the biggest challenges they have faced at the time of implementing the measures is to obtain resources, which is why access to climate finance is fundamental.

This guide to climate financing for states provides guidance and offers a series of answers to questions that states often ask themselves when they seek to understand what climate financing is, for example including the following:

  • What is the importance of climate finance for compliance with its policies in this area?
  • What are the sources of financing?
  • Where can the resources come from to finance climate change measures?
  • How can federative entities build their own financial resources without relying on a third party?

This guide establishes clear and precise steps to follow regarding the most viable financing alternatives that exist in the country in terms of experience, faculties and costs. In the same way, it intends to be an instrument on which those responsible for public policies in the matter can rely on when making decisions that involve getting access to public resources that they can provide as a source of financing.

Within the range of financing options detected for the states, the guide explains in a specific way the development and route of implementation of two financial vehicles at the state level:

  1. The Transverse Annexes in the Budget of State Expenditures (PEE, for its Spanish acronym)
  2. Environmental or Climate Change Funds.

This tool was developed by the Mexican-German Climate Change Alliance, a project implemented by Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH and was presented for the first time at the fourth regional workshop on “Strengthening Subnational Capacities and their Contributions to the Nationally Determined Contribution (NDC)” on January 25, 2018.

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