Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/265833 
Year of Publication: 
2022
Citation: 
[Journal:] DIW Weekly Report [ISSN:] 2568-7697 [Volume:] 12 [Issue:] 38 [Publisher:] Deutsches Institut für Wirtschaftsforschung (DIW) [Place:] Berlin [Year:] 2022 [Pages:] 229-235
Publisher: 
Deutsches Institut für Wirtschaftsforschung (DIW), Berlin
Abstract: 
Industrialized countries and emerging economies must cooperate in order to decarbonize the emissions-intensive industrial sector and to limit global warming to 1.5 degrees Celsius. While Germany and the other G7 countries have committed to supporting emerging economies in their efforts to combat climate change via international climate finance, it remains to be seen how this support can be implemented successfully. A wide variety of cooperation initiatives that could form a foundation for climate financing - such as climate clubs, partnerships, and alliances - are currently being discussed. However, the incentives to cooperate are not the same for industrialized and emerging countries. As of 2022, the climate club discourse centers on carbon prices, a carbon border adjustment mechanism, incentives for club membership, and sanctions for non-compliance. Financial-technical support for emerging countries has not been discussed sufficiently. Building on interviews with steel sector representatives, international organizations, the financial sector, and think tanks from both the European Union and emerging and developing countries, this paper analyzes existing gaps in cooperation. Moreover, it discusses how international carbon contracts for difference (CCfDs) can support the decarbonization of the steel industry.
Subjects: 
climate policy
international climate finance
cooperation
decarbonisation
JEL: 
Q40
Q41
Q42
Q48
F3
F63
F65
Persistent Identifier of the first edition: 
Document Type: 
Article

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