In 2025, countries are due to put forward new national climate plans under the Paris Agreement - or Nationally Determined Contributions (NDCs) - with expectations that this next round of NDCs closes current gaps in climate ambition and implementation to keep the goals of the Paris Agreement within reach. This report has been prepared as part of a joint OECD-UNDP project, with the financial support of the German Federal Foreign Office, to support countries in the 2025 cycle of revising their NDCs by making the case for the economic and development benefits of enhanced NDCs and how they can be delivered.
This joint report on Investing in Climate for Growth and Development – The Case for Enhanced NDCs provides evidence that maintaining and strengthening climate action is not just an environmental imperative; it is a strategic investment in economic stability and long-term prosperity, unlocking a range of development benefits. It also sets out the steps needed to implement NDCs through integrated approaches that bring climate and development strategies together and create the conditions to mobilise investment for climate action.
The report is structured around two distinct but interlinked parts that bring together climate ambition and implementation:
Part I provides evidence for the economic implications of scaled-up climate ambition compatible with the temperature goals of the Paris Agreement, using rigorous economic analysis and modelling. The analysis details how ambitious climate action can be compatible with economic growth while at the same time unleashing benefits from reduced climate damages (Chapter 2). Ambitious climate action can also be a starting point for developing countries to achieve economic growth through more sustainable pathways (Chapter 3). Additionally, the modelling analysis highlights the importance of anticipating structural changes in the economy (Chapter 4), and identifying policies that can support society through the transition, taking account of possible distributional and labour market consequences (Chapter 5).
Part II focuses on implementation and how the next NDCs provide an opportunity to close current gaps and unlock finance from different sources to realise the economic and development benefits of accelerated climate action. Building on insights from country experiences and lessons learned from previous NDCs, the analysis unpacks key dimensions of implementable, investable NDCs (Chapter 6). Chapter 7 explores enablers for effective NDC implementation, including robust governance arrangements and inclusive stakeholder engagement processes, while Chapter 8 outlines the strategies and approaches that governments can adopt to unlock and secure funding for NDC delivery.
The development of the report was led by the OECD Environment Directorate, with contributions from the UNDP, the OECD Economic Department and the Employment, the Labour and Social Affairs Department, as well as the Directorate of Financial Affairs, and the Centre for Entrepreneurship, SMEs, Regions and Cities and the International Energy Agency. This work is part of the Environmental Policy Committee (EPOC)’s work programme as a contribution to the OECD Horizontal Project Net Zero+, Building Climate and Economic Resilience.