Scoping Paper: Understanding the Intersection of Sovereign Debt, Climate Finance, and Loss and Damage

December 7, 2023

Resource Type

Policy Brief



Geographical Focus


Created On :
December 7, 2023

Sovereign debt is a fundamental financial aspect for governments and a readily used tool to facilitate development processes. As countries grapple with the challenges of climate change, the reliance on external debt to fund climate initiatives increases. However, this can become a double-edged sword when unsustainable debt levels hinder investments in climate resilience.

This scoping paper has been developed as part of SLYCAN Trust's work programme on climate finance and loss and ´╗┐damage (L&D) and serves as the initial step in a comprehensive analysis on the interlinkages between the realms of debt justice, a reform of the global financial system, and the implications on L&D funding. In an era where complex, compounding, and deeply interconnected challenges impact nations and their populations, a more nuanced understanding of the above-mentioned interlinkages is crucial for addressing these impacts and building a more sustainable and equitable future. This paper explores both existing and proposed routes for leveraging debt responses to mobilise climate finance for L&D.

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