THE IMPORTANCE OF CLIMATE FINANCE IN NORTH MACEDONIA

Climate change has emerged as the defining political and economic problem of this century. Governments, investors, businesses, and private individuals worldwide are beginning to take action in response to the climate issue, especially on decarbonization techniques. Moving to a low-carbon or green economy would need extraordinary levels of fresh capital investment, notably in the form of green financing, to support activities that cut GHG emissions and assist firms in adapting to the effects of climate change. The interaction between climate change and fiscal policy— physical and transition climate risks place pressure on public finances while at the same time fiscal policies can help contribute to achieving North Macedonia’s climate change objectives. This paper aims to explore the significance of the importance of climate public finance and its ability to manage climate-related contingent liabilities, finance climate action, promote a green transition, strengthen resilience, manage macro-fiscal sustainability, and enhance transparency and accountability in the allocation of public funds for climate action. As the world faces adverse impacts of climate change, additional funds or green bonds are required to flow toward climate finance to achieve the objective of limiting global warming and increasing climate resilience.