Chapter 5 | PROJECTS CONTRIBUTING TO THE OPEC FUND’S CLIMATE FINANCE
compared to business-as-usual scenarios. These targets un- derscore Panama’s commitment to reducing its carbon foot- print and enhancing its natural carbon sinks.
Mitigation finance will enhance Panama’s biodiversity, promote sustainable land use, and support the National Climate Change Policy 2050, focusing on carbon seques- tration and a low-carbon economy. The loan will fund 25 policy actions critical to these goals. The program will establish norms for managing low- carbon development and include a Procedures Manual for National GHG Inventories to ensure efficient and system- atic inventory processes. Finally, the loan will support the creation of a National Carbon Market, promoting a sustainable, low-emission recovery. A draft Executive Decree for the market has been prepared.
Expected Outcomes
The loan is crucial for Panama’s climate adaptation and mit- igation goals, supporting the country’s efforts to enhance climate resilience and meet its NDCs.
A key expected outcome is implementing a vulnerability index, using spatial analysis to assess biophysical and social factors. The data supports sustainable development by informing planners and decision-makers. Another expected outcome is the Adaptation, Monitoring, and Evaluation System, which tracks progress toward Paris Agreement goals. It includes a National Climate Transparen- cy Platform to consolidate and monitor climate and devel- opment initiatives.
Assessment according to the Joint MDB Methodology for Tracking Climate Finance
Through the loan, the OPEC Fund financed both mitiga- tion and adaptation policy actions.
The loan also aids in creating tools to identify vulnerable populations, helping to assess specific climate change im- pacts on these groups.
There are 25 policy actions, each funded by the OPEC Fund in equal proportion.
It supports developing a national manual for nature-based solutions, serving as a guide for managing infrastructure projects to enhance resilience. Terms of reference for engag- ing experts have been finalized. The loan helps consolidate the National Adaptation Plan, pri- oritizing adaptation measures in line with the updated NDC. It includes an updated progress report and roadmap for sec- tor-specific plans. Another expected outcome is a community technical guide for assessing vulnerability, resilience, and climate risk, ap- proved by Ministerial Resolution. It provides a methodology for applying climate criteria to public infrastructure projects.
A total of 10.4 effective policy actions contribute to miti- gation. Each action was reviewed and assigned a mitiga- tion contribution between 0 percent and 100 percent. This number is used to calculate mitigation finance. A total of 14.6 effective policy actions contribute to adap- tation. Each action was reviewed and assigned an adapta- tion contribution between 0 percent and 100 percent. This number is used to calculate adaptation finance. Finance calculations: Mitigation finance is calculated as 10.4/25 of US$120 million, totaling US$50 million. Adap- tation finance is calculated as 14.6/25 of US$120 million, totaling US$70 million.
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