The Climate Action Monitor 2025

3. How far did countries’ climate action progress?

Achieving the Paris Agreement temperature goals requires effective and timely climate policy action. Yet, current Nationally Determined Contributions (NDCs) and net-zero targets remain insufficient to limit global warming to 1.5°C or 2°C, revealing a persistent ambition gap. Even more worrying, many existing commitments are not on track to be delivered, pointing to an NDC Delivery Gap (Chapter 1). Bridging these gaps will require a significant step-up in ambition and action. In 2024, however, climate policy action (henceforth climate action) expanded by only 1%, continuing the slow pace of the last two years.

This chapter draws on the Climate Actions and Policies Measurement Framework (CAPMF) complemented with other sources to assess key developments in countries’ climate action in 2024. Developed under the International Programme for Action on Climate (IPAC), the CAPMF tracks the evolution of climate policies across countries and time. The 2025 edition significantly enhanced the scope, covering 87 policies across 97 jurisdictions (96 countries and the EU-27 as a bloc), up from 56 policies across 51 jurisdictions in earlier editions (see Box ‎3.1). While the coverage has expanded, the key policy trends remain largely consistent, reinforcing both the validity of earlier findings and the urgency of stronger climate action.

The 2025 edition of the Monitor also introduces a new structure, featuring an in‑depth review of a different sector and region each year, alongside an overview of key policy trends. For 2025, the focus is on the transport sector and on the Latin America and the Caribbean (LAC) region, which includes the host country of COP30. Nevertheless, country-specific and sectoral data on climate action can be found for all countries on the IPAC Climate Action Dashboard.

3.1. Climate action in 2024 expanded only marginally

The CAPMF tracks climate action by considering both policy adoption and policy stringency. In 2024, national climate action across CAPMF-covered countries only expanded by 1% (Figure ‎3.1) continuing the slow pace observed in 2022 and 2023 (1% and 2%, respectively) (OECD, 2023[1]), (OECD, 2024[2]). This is well below the 10% annual average increase observed between 2010 and 2021.

This continued trend is worrying as aggregate emissions’ trajectories remain off track to meet NDCs commitments (see Chapter 1). Emissions continue to rise in many countries and are falling too slowly in others, underscoring the need to intensify efforts. While climate action – as defined by the CAPMF – does not directly measure policy effectiveness, evidence suggests a positive link between the expansion of climate action and emission reductions (Nachtigall et al., 2024[3])1. Encouragingly, CAPMF data suggests that all countries still have multiple options to strengthen existing policies or adopt new ones.

Box 3.1. The Climate Actions and Policies Measurement Framework 2025 edition

The OECD Climate Actions and Policies Measurement Framework (CAPMF) is a climate mitigation policy tracker and database. Its main objective is to monitor how national climate policies evolve and how stringent they are (i.e. the degree to which they incentivise or enable GHG emission reductions)1. The CAPMF covers a wide range of climate and climate-relevant policies, including market-based and non-market-based instruments. It is designed to be comparable across countries, enabling both quantitative and qualitative analyses and supporting governments in tailoring policies to meet their climate commitments (Stechemesser et al., 2024[4]) (D’Arcangelo, Kruse and Pisu, 2024[5]).

The 2025 edition significantly broadens the policy and geographical scope, better reflecting countries’ diverse policy approaches and enhancing regional coverage. It tracks 272 policy variables - grouped into 87 policies - from 1990 to 2024. This represents a coverage of around 90% of policy instrument types listed in the last IPCC report (IPCC, 2022[6]). Compared with the previous edition, new features include:

• New sectoral policies: Agriculture, forestry, land-use (AFOLU) and waste

• New modules: climate-related financial policies

• Extensions to existing modules: subsidies for low-carbon technologies (e.g. tax credits for renewables), regulatory instruments, information tools and green public procurement policies.

For more details see Annex B.

1. Policy stringency is defined as the degree to which policies incentivise emissions reductions. Following the methodology of the OECD Environmental Policy Stringency Index (Kruse et al., 2022[19]), the CAPMF calculates stringency as a relative concept by assigning a stringency score between 0 (not stringent) and 10 (very stringent) to each policy variable. This is based on the in-sample distribution across all countries and years of the policy variables’ level (e.g. tax rate, emissions limit value, government expenditure) (Nachtigall et al., 2022[7]). High stringency values in a particular country do not necessarily suggest the policy is stringent enough to meet its mitigation goals. Rather, it means the policy in this country and year was more stringent compared to all other countries and years.

Source: (Nachtigall et al., 2022[7]) and (Nachtigall et al., forthcoming).

ETSs, new regulations, and updated climate targets drove climate action in 2024

The modest expansion in national climate action in 2024 reflects diverse policy developments across countries, sectors, and policy instruments (Table ‎3.1). The strongest growth was observed for market-based instruments (see dedicated section below), followed by “targets, governance, and climate data”.2 Key advances included new or more ambitious targets, including the introduction of a net-negative target3 for 2060 in Germany. Several countries, including the United Arab Emirates (UAE) and Türkiye submitted their long-term low emissions development strategy (LT-LEDS) while others (e.g. Kuwait and Thailand) joined the Kigali Amendment4 to the Montreal Protocol.

Across policy instrument types, emissions trading systems (ETS) recorded the largest increase in 2024. This was driven mainly by the expansion of the EU ETS to cover maritime transport – identified as the single most important driver of overall climate action in 2024 – and the launch of new ETS in Australia under the Safeguard Mechanism Credits and in some Mexican States. The adoption of performance standards also increased, notably through building codes mandating net-zero buildings in countries such as Iceland. At the sectoral level, transport experienced the largest increase in climate action in 2024, narrowly surpassing the building sector. Examples in progress in climate action include: Ethiopia becoming the first country to ban the sale of new conventional cars starting in 2024. Also, Japan and Malaysia announced new coal phase-out targets for 2035 and 2045, respectively, and Indonesia brought forward its coal exit from 2045 to 2039.

At the regional level, the strongest increases were observed in Western Europe and Canada, followed by the Middle East and North Africa (MENA), Latin America and the Carribean, and Sub-Saharan Africa. Progress in African countries is described in more detail in a forthcoming joint OECD – GGGI – World Bank report. With respect to indvidual countries, progess includes: Australia’s new ETS, Israel’s participation in MARPOL VI and Singapore’s strengthened carbon tax, these underpin the largest country-specific growth in 2024. Among the 97 jurisdictions covered by the CAPMF, 52 registered an increase in climate action, 17 experienced a slight decline, and 28 showed no net change. These groups account for 64%, 10%, and 7% of global GHG emissions, respectively.

Table 3.1. Top drivers of climate action in 2024

Increase in climate action between 2023 and 2024: by dimension

Dimension	Greatest increase	2nd greatest increase	3rd greatest increase
Broad policy category	Market-based instruments	Targets, governance and climate data	Non-market-based instruments
Policy instrument type	Trading systems	Performance Standards	Targets
Policy	Pricing of international emissions	Domestic ETS	Building codes
Sector	Transport	Buildings	AFOLU
Region	Western Europe and Canada	Middle East and North Africa	Latin America and the Caribbean
Country	Australia	Singapore	Israel

Source: Authors’ elaboration based on the CAPMF, see https://www.oecd.org/en/data/dashboards/climate-action-dashboard.html.

Climate action has increased globally over the past decades, though progress remains uneven across regions and countries.

Climate action has followed three distinct trajectories across country groups (Figure ‎3.2). While climate action grew steadily in all groups until 2020, the pace of increase has largely slowed down since. OECD countries sustained stronger action and achieved the greatest acceleration whereas non-OECD countries progressed more slowly, widening the climate action gap. Among non-OECD countries, a divergence is also visible between G20 and non-G20 economies. The divergence raises concerns on competitiveness and carbon leakage potentially undermining the effectiveness of increased climate action on global emissions reductions. The findings underscore the need for stronger international co-ordination and co‑operation to meet national and global climate goals.

Growth in climate action has varied widely across regions and countries (Figure ‎3.3). Most OECD countries – particularly those in Western Europe, Oceania, East Asia, as well as Israel and Canada – achieved the strongest increases. Eastern European countries and Türkiye also made steady progress, albeit at a slower pace. In contrast, some regions recorded more uneven advances, with a few countries emerging as regional leaders. For instance, Chile, Costa Rica, and Mexico led progress in the Latin America and the Caribbean (LAC) region, whereas South Africa, Singapore and Indonesia stood out in Africa and Southeast Asia, respectively.

3.2. Progress in climate action in AFOLU, waste and transport sectors remained modest

Between 2010 and 2024, climate action in the AFOLU and the waste sectors saw only limited progress Figure ‎3.4). Both sectors – covered for the first time by the CAPMF (Box 3.1) – lagged behind energy‑related sectors such as electricity, transport, buildings and industry. This reflects challenges associated with mitigation in these areas despite agriculture’s high vulnerability to climate change (Chapter 1). With emissions from agriculture and waste still rising in many countries (Chapter 2), stronger efforts are needed to reverse the trend. Encouragingly, some countries have begun to act in these sectors: for example, Australia and Germany included waste in their ETSs, and Denmark introduced a pricing mechanism for GHG emissions from agriculture (Box ‎3.3).

3.3. Climate action in the transport sector needs to be ramped up

Climate action in the transport sector remains insufficient. Among the energy sectors, transport experienced the smallest increase in climate action between 2010 and 2024 despite recent progress (Figure ‎3.5). Yet, transport continues to account for one of the highest per capita emissions in OECD and G20 countries and was among the largest contributors to emissions growth over the period (Chapter 1). The gap between the scale of climate action and the sector’s GHG emissions highlights the urgent need for stronger measures. While the CAPMF can produce an initial indication of a potential misalignment, further analysis of country-specific conditions is necessary to provide a more granular picture of the policy landscape.

Subsidies for electric vehicles have grown significantly

There is significant variation in the growth and level of climate action across transport-related climate policy instruments (Figure ‎3.6). Subsidies for electric vehicles (EVs) have driven the largest increase in the sale of EVs which have become increasingly cost-competitive to internal combustion engine (ICE) cars. Many countries have expanded subsidies to accelerate EV adoption, contributing to global EV sales reaching an all-time high in 2024. Nonetheless, EVs represented only 22% of global passenger car sales in that year (Figure A.3).

Countries are increasingly complementing EV incentives with measures to curb the attractiveness of ICE cars. Many countries have introduced time-bound phase outs of ICE vehicle sales, a policy instrument that experienced the second largest growth in climate action between 2010 and 2024. First adopted in 2015, these policies set clear target dates for phasing out ICE car sales, improving technology certainty and guiding investment in research and production (Figure ‎3.7). However, most bans will become effective only in 2035 or later, risking to lock-in fossil-intense assets. Yet, there are some notable exemptions, for example, Norway’s 2017 target to end ICE car sales by 2025 has brought EV sales to almost 90% in 2024. Similarly, Ethiopia banned imports of ICE cars in 2024 to cut reliance on oil imports and preserve foreign currency reserves.

Progress in other transport-related climate policy instruments has been more limited. Notable gains were achieved through fuel economy standards and labelling, which improved the fuel efficiency of ICE cars, and helped reduce GHG emissions from the incumbent technology. By contrast, less progress was observed for pricing instruments, such as carbon taxes, excise taxes and ETSs. Public investments in rail infrastructure and congestion pricing also showed little growth. Although the number of cities with congestion pricing schemes increased from 8 in 2010 to 16 in 2024, such measures remain rare in most countries.

Both congestion pricing and public transport investment are crucial to incentivise shifts to more sustainable transport modes (OECD, 2025[8]). Transport-related fossil fuel support increased slightly between 2010 and 2024, reinforcing reliance on fossil-fuel-based mobility. This increase was especially pronounced during the 2022-2023 energy crisis, though support levels are expected to decline in the coming years.

Stronger climate action is associated with reduced transport emissions

Countries with more ambitious transport-related climate action in 2024 generally succeeded in reducing transport emissions (Figure ‎3.8). Among the ten countries with the highest transport-related climate action in 2024, only one experienced an increase in transport emissions between 2015 and 2024. By contrast, nine out of the ten countries with the lowest level of climate action still recorded emissions growth.

The transport sector is often described as hard-to-abate due to rising mobility demand and limited technological alternatives. These factors complicate the implementation of effective mitigation strategies. While the relationship shown here is descriptive, it suggests that stronger climate action can help reverse emission growth despite such challenges. Further research is needed to assess the effectiveness of specific mitigation policies. A recent study also offers insights on targeted policy interventions in the transport and other sectors (Box ‎3.2).

Box 3.2. Effective strategies to reduce transport emissions

Policymakers need to know which policies are most effective to meet the Paris Agreement temperature goals. This is especially true for transport, where emissions are still rising in most countries. A study led by the Potsdam Institute for Climate Impact Research (PIK) combines the CAPMF data with machine learning to provide the first global, systematic ex post evaluation of policies and policy mixes that have led to large emissions reductions or emissions breaks.

The results show that policy mixes are more effective than stand-alone measures (Figure ‎3.9). Across all sectors, 70% of emissions breaks were linked to a mix of policies, compared to just 30% for stand-alone measures. In the transport sector, almost 95% of breaks were associated with policy mixes. This reflects the sector’s complexity, characterised by heterogeneous households rather than profit-maximising firms. Hence, multiple instruments may be warranted to overcome barriers, including financial constraints, limited information, or myopia. For example, the sharp decline in transport emissions in Norway was driven by a mix of financial support for electric vehicles, strong investment in rail infrastructure and regulations such as the ban on new conventional cars from 2025.

Figure 3.9. Policy mixes are more successful in reducing emissions than stand-alone policies

Successful policies and policy mixes in the transport sector

The importance of policy mixes highlights the need for further research. Despite decades of experience with climate policies worldwide, there is still no clear consensus on which policy combinations are more effective, indicating a major policy evaluation gap. Broadening the scope and ensuring comparability of climate policy data, as pursued under the CAPMF and the IFCMA, will be critical to close this gap and provide robust evidence for policy design.

Note: The diagram shows which combinations of policy types are effective in the transport sector, separately for developed and developing countries. Each circle shows the share of successful interventions that involved a specific policy type or combination. The percentages indicate how often each policy setup contributed to success.

Source: (Stechemesser et al., 2024[4]).

3.4. Market-based instruments grew slightly in 2024, but remain less used

The use of market-based instruments (MBIs) increased slightly in 2024 but still lags other types of climate action, including non-market-based instruments (nMBI) such as regulations and information instruments as well as actions related to targets, governance and climate data (Figure ‎3.10). The expansion of the EU ETS to the maritime sector under the EU’s “Fit-for-55” package (European Commission, 2025[9]) was the single most important factor behind this increase. Other positive developments included higher government spending on low-carbon research and development (see below), new ETSs in Australia and some Mexican States, and new congestion pricing schemes, such the one implemented in Kaunas, Lithuania. These gains far outweighed the drop from EUR 83 to EUR 65 in EU ETS permit prices in 2023‑2024. More details on non-market-based instruments are provided in the recent IPAC Data Insight.

The use of market-based instruments varies significantly across countries

The role of MBIs varies significantly across countries (Figure ‎3.11), reflecting differences in emissions profiles, institutional capacity and political priorities. For instance, the EU-27, Canada and New Zealand emphasise MBIs, with carbon pricing and environmentally friendly subsidies playing a key role. By contrast, in countries where MBI are less prominent, regulatory measures such as standards and mandates dominate.

While both MBIs and nMBIs can reduce emissions (Stechemesser et al., 2024[4]), (OECD, 2025[10]), MBIs such as carbon pricing are usually more cost-effective. Nevertheless, nMBIs are more widely used and have certain advantages over MBIs: they provide regulatory certainty since measures such as bans, mandates and standards deliver clear and predictable outcomes. Moreover, nMBIs do not impose a visible financial burden on consumers, which can result in higher public acceptance compared to MBIs. Together, MBIs and nMBIs create a more cohesive policy mix to reduce emissions.

Despite recent progress, carbon pricing remains less used, covering less than half of global GHG emissions. In 2023, the average effective carbon rate of emissions covered by a type of carbon pricing –combining carbon taxes, fuel excise taxes and ETS permit prices– was around EUR 17, this represents a slight decrease from 2021 (OECD, 2024[11]).5 However, this remains well below the benchmark rates of EUR 60 or EUR 120 estimated to be needed by 2030 to decarbonise by mid-century (OECD, 2021[12]), (Kaufman et al., 2020[13]). Moreover, effective carbon rates remain critically low in sectors outside road transport with agricultural emissions currently facing no direct carbon price. Denmark’s forthcoming carbon tax marks a significant shift (Box ‎3.3).

Policies that cover international transport emissions is expanding slowly. International maritime emissions are currently only priced in the EU, while international aviation emissions are increasingly covered through the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) – the first ETS for international aviation. Participation in CORSIA increased from 88 countries in 2021 to 126 in 2024, but the share of international aviation emissions covered only increased from 78 to 80%. Several key emitters have yet to join (Figure ‎3.12).

Box 3.3. Denmark pioneers the world’s first carbon tax on agricultural emissions

Agriculture accounts for around 35% of Denmark’s GHG emissions in 2021, with nearly 90% coming from cattle and swine breeding. Agricultural emissions declined by only 2.9% between 2005-2021, while their share of total emissions is expected to reach 45% by 2030 as other sectors decarbonise. To address this, Denmark launched the “Green Denmark” reform package, centred on the world’s first carbon tax on livestock farming.

• From 2030, farmers will pay DKK 120 (EUR 16) per ton of CO₂e, rising to DKK 300 (EUR 40) by 2035.

• Climate‑efficient farms can reduce their tax burden by up to 60% through deductions, with subsidies supporting methane‑reducing feed additives.

The reform also includes broader measures:

• The Green Area Fund allocates EUR 5.3 billion to reforest 250,000 hectares by 2045 and set aside 140,000 hectares of carbon‑rich lowlands by 2030.

• Farm buyouts, compensation schemes, and DKK 10 (EUR 1.3) billion in subsidies for biochar storage technology are also foreseen.

The policy’s successful adoption reflects strong tripartite dialogue among government, industry, and civil society, fostering broad consensus for transformative change. Denmark’s pioneering carbon tax offers a blueprint for OECD and EU countries, showing how ambitious, socially accepted agricultural reforms can accelerate the transition to climate‑smart farming while maintaining the sector’s competitiveness.

Source: Based on (OECD, 2024[14]) and (OECD, 2025[15]).

Climate action based on regulations is positively associated with the use of carbon pricing. (Figure ‎3.13). This suggests that regulations and carbon pricing often co-exist as complementary measures rather than substitutes. By contrast, the link between carbon pricing and other instrument types such as information tools or subsidies is negligible. Although this analysis is descriptive, it suggests that countries with more stringent technology standards (e.g. bans and phase outs of fossil fuel-related activities and internal combustion engines) or performance standards (e.g. air emissions and minimum energy performance standards) also tend to also implement more robust carbon pricing. While carbon pricing provides a market signal to reduce emissions, technology and performance standards incentivise specific actions, such as phasing polluting technologies or strengthening energy efficiency standards.

Public expenditure on low-carbon energy-related research and development (R&D) reached an all-time high in 2024 (Figure ‎3.14). While China was a key driver of growth in public R&D spending between 2018 and 2023, Europe emerged as the leading contributor to the increase in 2024. R&D expenditure in Japan, Korea, Australia and New Zealand also increased slightly in 2024 after having fallen in 2023.

3.5. Climate action in Latin America and the Caribbean only expanded marginally since 2021

Latin American and Caribbean countries represent around 7% of global GDP and 8% of global population while generating around 7% of global emissions. Nevertheless, climate action is especially critical since many countries are experiencing significant climate-related hazards with impacts that directly affect lives and livelihoods. Region-specific challenges related to climate mitigation include relatively high emission reduction costs in relation to national income, as well as high risks associated with potential fiscal and export losses tied to fossil fuels (see the recent IPAC Data Insight on climate action in Latin America).

Climate action in Latin America and the Caribbean (LAC) increased significantly between 2010 and 2021, but the rate of that growth has since slowed significantly (Figure ‎3.15).6 As a result, the gap in climate action between LAC countries – based on data from 12 countries of that region – and the OECD widened between 2010 and 2024. While LAC countries outpaced non-OECD countries and many other world regions in advancing climate action between 2010 and 2021, this lead gradually diminished since 2021. This trend was primarily driven by a decline in climate action observed in Central American countries since 2021 (Figure ‎3.16). Nevertheless, these countries continued to maintain the top position in front of South America and the Caribbean in 2024.

Climate action expanded across all policy instrument types between 2015 and 2024, albeit at varying speeds (Figure ‎3.17). However, by 2024, climate action in LAC did not exceed the OECD average for any instrument type. Since the adoption of the Paris Agreement, LAC countries have made significant progress on nMBIs – mostly driven by performance standards – and actions related to targets, governance and climate data. There has also been some, though limited, progress on MBIs, where the gap on climate action between LAC countries and the OECD average is still most pronounced. The slow progress on MBIs reflects a broader global trend among countries covered by the CAPMF (see Box ‎3.4 on a regional initiative on carbon pricing). The least progress was observed in “climate data”, an important indicator of effective implementation – particularly in areas such as the submission of biannual evaluation reports and GHG emissions accounting, where gaps in reporting and transparency persist.

Box 3.4. Carbon Pricing in the Americas (CPA)

Several countries in the Latin America and Caribbean (LAC) region have introduced market-based incentives as part of their climate change mitigation strategies. For instance, 24 countries have identified fiscal measures as tools to support the implementation of their Nationally Determined Contributions (NDCs). While individual countries pursue different instruments to meet their commitments, regional collaboration is essential to fully leverage opportunities under global carbon markets. A well-functioning regional carbon market could help reduce emissions at lower cost, while also enabling LAC countries – which account for only about 7% of global emissions and hold significant forest reserves – to provide offsets and compensation internationally. Such initiatives could unlock resources for investment in clean technologies, support further emissions reductions, and generate productivity gains.

A flagship initiative to foster this collaboration is Carbon Pricing in the Americas (CPA). Since 2018, national and subnational governments, together with non-governmental partners, have been working to coordinate and strengthen carbon pricing efforts across the continent. The CPA emerged from the Paris Declaration on Carbon Pricing in the Americas, endorsed in December 2017 by Alberta, British Columbia, California, Canada, Colombia, Costa Rica, Chile, Mexico, Nova Scotia, Ontario, Québec, and Washington.

The CPA was formally launched in April 2018 under the co-chairmanship of Canada and Mexico. At COP26 in Glasgow (2021), most original members, along with additional governments, renewed their commitment through the Glasgow Declaration on Carbon Pricing in the Americas, which replaced the Paris Declaration.

By endorsing the Glasgow Declaration, members committed to:

• Implementing or advancing carbon pricing as a central climate policy tool.

• Applying a cost of carbon in public investment decisions.

• Regularly increasing carbon price levels to reflect rising abatement costs and the social cost of carbon.

• Strengthening regional and international cooperation through sharing knowledge and best practices.

• Identifying opportunities to align and link carbon pricing systems and markets across jurisdictions.

• Promoting synergies among existing carbon pricing initiatives and forums active in the Americas.

Current members include:

• National governments: Canada, Chile, Dominican Republic, Mexico, Panama, Paraguay.

• Subnational governments: Aguascalientes, British Columbia, California, Federal District of Brazil, Guanajuato, Jalisco, Nova Scotia, Pernambuco, Québec, Querétaro, Rio de Janeiro State, Sonora, Yucatán.

Source: https://carbonpricingamericas.org/about-cpa/.

Latin American and Caribbean countries follow a distinct policy approach

A distinct feature of LACs current policy mix is its strong reliance on climate action related to targets, governance and climate data (Figure ‎3.18). In 2024, LAC countries recorded the second-highest global share of this policy type at slightly above 26%. This is largely driven by LAC countries having ratified key climate treaties, active participation in major international climate initiatives, and committing to comparatively stringent net-zero targets. To achieve these targets, LAC countries - like most regions outside Western Europe and Canada - prioritise nMBIs over MBIs. However, despite the reliance on nMBIs, there is some evidence that MBIs were more effective in delivering emissions reductions in the region. Based on a systematic ex-post evaluation using the CAPMF, a recent study concluded that 8 of the 11 (or 73%) identified emissions breaks in LAC were associated with the adoption of MBIs (see Box 3.2 for the methodology) (Stechemesser et al., 2024[4]).

LAC countries have implemented a diverse policy mix, as reflected in the CAPMF (Figure ‎3.19). By 2024, most LAC countries adopted net-zero targets as well as key nMBIs, such as minimum energy performance standards, fuel economy standards and appliance labelling. Some technology standards -such as coal phase outs - are relatively widespread, whereas others, such as bans on the sale of new passenger cars with ICE have only been enacted in a few countries. Notably, no LAC country has yet pledged to phase out passenger cars with ICE. Market-based instruments such as carbon taxes, ETS or feed-in-tariffs are also not yet widely adopted. Mexico remains the only country with an ETS pilot, although ETSs are under discussion in other LAC countries, including Brazil, Chile, and Colombia (ICAP, 2025[17]). Only four out of the ten LAC countries covered by the CAPMF participate in CORSIA.

Figure 3.19. LAC countries have a diverse set of policies in place in 2024

Adoption of key climate policies: 12 LAC countries, 2024

Note: SEEA: System of Environmental-Economic Accounting; MEPS: Minimum Energy Performance Standards; ICE: Internal combustion engine; ETS: Emissions trading scheme, RD&D: Research Development and Demonstration. Numbers refer to target year (Net-zero target, bans and phase outs), IE efficiency class for MEPS of electric motors and the share of public RD&D expenditure on GDP. N/S = not specified. N/A = missing data

Source: Based on data from OECD, IEA, ITF, World Bank and others using the methodology of Nachtigall, D. et al. (2022): “The climate actions and policies measurement framework: A structured and harmonised climate policy database to monitor countries’ mitigation action”, OECD Environment Working Papers, No. 203, OECD Publishing, Paris, https://doi.org/10.1787/2caa60ce-en.

This chapter examined the evolution of climate action across the world, highlighting the case of Latin America and the Caribbean. It showed that climate action – as measured by the CAPMF – expanded only marginally in 2024, continuing the trend observed in 2022 and 2023. The modest increase reflects diverse policy developments across country groups, countries, sectors, and policy instrument types. The slow progress is concerning, as countries are not on track to reach their current NDCs and, thus, may fail to close the NDC Delivery Gap (Chapter 1), undermining the Paris Agreement goals.

Nevertheless, considerable opportunities remain for all countries to narrow and close the NDC Delivery Gap as can be seen in the country-specific data presented in the IPAC Climate Action Dashboard. Adopting new and strengthening existing policies will be crucial to reduce emissions and bring countries on track to meet their current and more ambitious new NDCs.

Providing comprehensive climate policy data is essential for evaluating countries’ mitigation efforts, identifying key policy trends, and fostering both peer learning and analytical work that supports evidence‑based policy recommendations. This need is especially critical for developing countries, where emissions continue to rise. Improving climate policy data is therefore vital to better support countries in reaching their emissions targets. The CAPMF and the detailed policy stocktake under the IFCMA represent important initial steps. However, further efforts are required to deliver a comprehensive overview of the global mitigation policy landscape that supports policymakers to make better-informed decisions.

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[12] OECD (2021), Effective Carbon Rates 2021: Pricing Carbon Emissions through Taxes and Emissions Trading, OECD Series on Carbon Pricing and Energy Taxation, OECD Publishing, Paris, https://doi.org/10.1787/0e8e24f5-en.

[4] Stechemesser, A. et al. (2024), “Climate policies that achieved major emission reductions: Global evidence from two decades”, Science, Vol. 385/6711, pp. 884-892, https://doi.org/10.1126/science.adl6547.

Notes

← 1.  The CAPMF should not be used as a performance indicator to rank countries’ climate action as its policy scope may not represent adequately the policy approach of some countries. For example, despite its inclusion, information is still limited in sectors such as agriculture, forestry and land use. Furthermore, the CAPMF does not fully capture new innovative instruments or climate actions such as carbon abatement payment or pledges (e.g. Global Renewables and Energy Efficiency Pledge) (COP28 UAE, 2023[18]) nor does it include the ETS II, which will only become fully operational in 2027. Thus, policies included in the CAPMF may not be fully representative of the mitigation approaches of some countries. In terms of interpretation, although previous work has found a positive association between climate action as measured by the CAPMF and emissions reductions (Nachtigall et al., 2024[3]), increasing climate policy action does not necessarily imply a stronger mitigation effect. The effects of increased policy adoption and policy stringency will depend on many factors such as emissions coverage and abatement costs and will likely have different impacts across countries depending on their emission profile, available energy resources, and institutional framework (Nachtigall et al., 2022[7]).

← 2.  Importantly, this year’s Climate Action Monitor does not yet account for the fact that most countries did not submit their new NDCs in time. Only 15 of the 195 parties to the Paris Agreement met the 10 February 2025 deadline to communicate their 2035 climate plans to the UNFCCC (Chapter 1).

← 3.  As negative emissions are likely needed to reach the Paris Agreement temperature goals, these targets are critical for sustaining climate action beyond the achievement of net-zero goals by highlighting countries’ ambition related to negative emissions.

← 4.  The Kigali Amendment to the Montreal Protocol is a key international agreement to limit the use and production of hydrofluorocarbons (HFCs) – a group of greenhouse gases many times more powerful than CO₂.

← 5.  Data is based on 79 countries, covering around 82% of global GHG emissions.

← 6.  The 12 countries covered in this analysis are Argentina, Brazil, Chile, Colombia, Costa Rica, Grenada, Honduras, Mexico, Paraguay, Peru, Saint Lucia, and Saint Vincent and the Grenadines.