Enhancing Climate Ambition Through Increased Transparency and Open Data in LAC

A recent study published by Nature has estimated that climate change will reduce future global income by about 19% ($38 trillion a year ) in the next 25 years, and underlined that the most socially and economically vulnerable countries will be hit the hardest.

Given their vulnerability, but also their concrete climate commitments, countries in Latin America and the Caribbean (LAC) continue to ramp up their efforts toward the fulfillment of their nationally determined contributions (NDCs) to ensure the attainment of the Paris Agreement target. Yet, it is often challenging to shed light on the actual progress being made. This ambiguity hinders the rate at which climate action takes place, dampens the credibility of enhanced ambition announcements, and decreases the opportunities to scale up impactful projects and crowd in private capital. In this new era, civil society is increasingly demanding accountability, backed up by open data management to foster transparency and citizen ownership.

In this context, the IDB's recent publication "Towards Enhanced Climate Ambition: Transparency and Digital Governance in Latin America and the Caribbean" highlights the crucial role of monitoring, reporting and verification to track climate change actions, climate finance and concrete results behind the political commitments. Improving the quality of climate data and fostering transparent mechanisms allows countries to strengthen climate governance and their compliance with international agreements, such as the Paris Agreement's Enhanced Transparency Framework (ETF). Similarly, it increases the possibility of accessing innovative financial results-based instruments, such as green bonds and debt-for-climate/nature transactions. These instruments rely on the existence of robust and centralized information with which to corroborate the achievement of targets or Key Performance Indicators (KPIs), which track and report on the commitments made by the government as part of their structure.

Transparency: a cornerstone of Paris Agreement implementation

The Paris Agreement's ETF is a set of obligations, rules, and procedures that set out how countries must report their progress in the implementation of their commitments. This is meant to increase transparency regarding the contribution each country makes to the global effort and its own progress in relation to the commitments it has undertaken.

The ETF's data collection systems and tools provide the international community with information to improve their scientific understanding of climate change and offer valuable evidence to assess the impact of measures being adopted to address climate change. In addition, the reports that make up the ETF requirements serve as a basis to develop subsequent, and ideally more ambitious, NDCs.

While the countries in LAC have gradually built their experience to meet the UNFCCC reporting requirements of the system that preceded the Paris Agreement, the ETF introduces additional responsibilities and further increases climate finance tracking capacities. It also builds on existing or fragmented technical capacities which require that countries move to robust transparency systems that involve all relevant stakeholders.

Generating quality data to inform policy-making and build trust

Understanding how countries in LAC are coordinating across their various government agencies to produce the data required for the ETF, exploring the synergies they are harnessing and examining their open data policies is fundamental to continue enhancing climate ambition. A robust climate governance system should be structured in such a way that climate data can feed into relevant and effective climate action policies. This entails having access to comprehensive, up-to-date, and verifiable information. For this to happen, governments need to understand the critical need to prioritize climate data and its key relevance in their digitalization and open data reforms.

Open data policies, within the framework of robust climate data governance, offer multiple benefits. For instance, they enhance the quality of data since it is continuously monitored by various users who provide feedback on inconsistencies and errors detected. They also foster comparability by encouraging the creation of a unique database with standardized information. Furthermore, they enable the design of policies and investments that can help attain climate targets, ensuring low carbon and resilient development, as well as a vertical integration of climate objectives by all sectors.

LAC countries exhibit varying levels of progress in this area. While there is widespread agreement on the advantages of centralizing open data in a single repository, many organizations persist in launching their own data portals. Consequently, this information must then be replicated within the centralized portals, generating inefficiencies. Additional work is also needed in the standardization of formats, process automation, and interoperability, among others.

LAC countries must prioritize efforts to streamline data generation, ensure comparability and interoperability, and encourage its reuse by government and non-government actors. By making data freely accessible to researchers, policymakers, and the public, open data policies promote innovation and collaboration, facilitating the development of new tools and insights that can drive more effective climate action. Access to information also empowers civil society to hold government and other stakeholders accountable for their actions and builds trust on the effectiveness of the measures being taken and the progress being reported. Finally, data can allow for a better understanding of the work being done and open new financial opportunities for countries betting on their climate and biodiversity assets to access new sources of funding.

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