What should Chile do?

1

Enhance NDC its to be 1.5 degree aligned by COP27:

  • To strengthen legislation related to NDC objectives and raise its ambition to achieve carbon neutrality by 2050
  • The protection of glaciers is an important piece of legislation to protect water reserves
  • The Native Forest and Forestry Development law needs to be updated to protect and restore native species, to achieve the country’s commitment to reforest 1 million hectares of strategic landscape by 2030. The Urban Forestry and Green Infrastructure bill will ensure the protection of these elements in cities, considering that 88,6% of the population lives in urban areas.
  • To strengthen legislation on conservation of ecosystems such as wetlands, oceans and border zones
2

Build a just and resilient recovery plan:

  • To continue and deepen the just and resilient recovery plan through adaptation and integration measures that allow the creation of new jobs
  • Further use of nature-based solutions that offer cost–efficient measures
  • Increase investment in green hydrogen and lithium development projects enhancing R&D&I while incorporating sustainability principles. These sectors have the potential of creating over 100,000 new green jobs
  • To continue investments in electromobility and resilient infrastructure
  • Continue to support the Climate Law and sustain dialogues on the best way to include climate action in the upcoming Constitution

What you need to know about Chile?

Climate Change Vulnerability

  • Chile is facing a 13 year drought. There is a 60%-80% deficit in relation to historical average rainfall and river flows at historical lows. The government has issued an Emergency Plan that seeks to ensure supply and disponibility of water for human consumption. However, there are many active socio-environmental conflicts as a result of water supply

Recovery Measurements to Highlight

  • 30% of the budget of the Public Works and Investments Plan in the context of COVID-19 corresponds to sustainable projects, as of the first semester of 2021. Nonetheless, the majority of these projects correspond to mitigation projects (57,7%). Thus, investment in adaptation and integration projects must increase considering the vulnerability of Chile in the face of climate change.

Green finance

  • The Ministry of Finance has recently created a Green Finance Office, which is in charge of channeling investments towards green assets. In 2021, the country issued its first Sustainability Green Bonds. Since 2019, Chile has issued US$7.700 million in green bonds. The Ministry is also working on a taxonomy for green initiatives in order to enhance sustainable finance of projects.
Recovery Measurements to Highlight

  • The “Paso a Paso: Chile se recupera” [Step by step: Chile recovers] initiative has outlined measures to incentivize employment and investment, as well as SME support and red tape cuts. The plan explicitly mentions the installment of new hydroelectric and desalinization plants among other infrastructure related to sanitization, waterworks and public transport
  • The recovery plan establishes that 30% of the public investment should be aligned with CBI (Climate Bond Initiative) standards given the underlying Sovereign Green Bond financing

Recent developments, threats and levers for action

Recent developments

  • Climate Change Law – With the recently approved Climate Change Law, Chile became the first country in Latin America to establish carbon neutrality by 2050 by law. The norm demands a revision every 5 years of the targets that the country has to achieve carbon neutrality. In addition, it requires the establishment of information, monitoring, reporting and verification systems in order to check the progress of the Long Term Climate Strategy. It also norms different issues such as resilience and climate change adaptation, water security, among others, and it recognizes the progressive and non-regressive principles
  • Escazú Agreement – Regional environmental agreement, the first of its kind in Latin America. Legal instrument for environmental protection, which aims to ensure the access of information and the participation of groups and individuals in decisions that can affect the environment and their wellbeing. The official signing and ratification process has already expired. The new government symbolically signed this agreement, and it is yet to be ratified by the Congress, and later on by the International Treaty Office of the United Nations
  • Chile submitted an enhanced NDC in April 2020. Although still not consistent with 1.5ºC or 2ºC pathways, WWF classifies it as “a short way to go” to an ideal level of ambition – it brings Chile to a pathway of between 2C and 3C of temperature increase. It is unlikely that Chile will present another update soon
  • The pandemic temporarily appeased the social uproar of 2019 but social unrest is ongoing and a referendum was held on October 25th, 2020 which approved the drafting of a new Constitution to replace the current one – from 1980 and widely considered to give an undue amount of power on the executive. The new Constitution will be developed by a Constitutional Convention made up of members elected by citizens during 2021. Subnational actors such as AGORA AG, electric car company BYD, and the Government of the city of Santiago are all key actors that could influence a renewable energy and climate-aligned narrative to be adopted in a new constitution. A new constitution is likely to adopt a more ‘social democratic’ stance by redistributing power to a legislative assembly and expanding the role of the government, likely opening the door for more ambitious climate action led by the public sector in the coming years
  • Economic crisis and unemployment are pressing policy-makers to focus in short-term policy reliefs schemes, giving little space for strategic long term goals such as climate. Electrification of transportation, renewables and green hydrogen create a positive narrative of economic opportunity
  • There is considerable interest among some non state actors, including the current Climate Champions to discuss the potential launch of an Alliance for Climate Action (ACA) to work on the NDC implementation

Strengths

  • Clean technology (renewable energy, electric buses and decarbonization of the energy sector, coal phase-out is moving forward)
  • No oil and gas production potential
  • Chile was one of the first countries to officially submit an updated NDC in 2020 and a Long Term Climate Strategy in 2021
  • First country in Latin America to establish carbon neutrality by 2050 by law

Opportunities

  • Social discontent could be channeled through the Constitutional Convention to include decarbonization and resilience discussions into a new constitution
  • Escazú Agreement will pave the way for better information availability and public participation in environmentally controversial projects
  • New government is favorable to climate change agenda

Weaknesses

  • Public agenda is being defined by other topics that are emerging in a post-pandemic scenario, such as economic crisis, migratory problems and crime
  • A progressive energy transition is being held back by lackluster planning regarding the phase out of coal plants.
  • The pandemic has changed political priorities and boosting employment and economic growth are at the core of policy decision-making
  • Neighboring Argentina’s expanding natural gas production has made transnational gas pumping more accessible and attractive to Chile in the face of the energy transition

Threats

  • Inequality and social justice dominate the debate and educes the possibility for a climate ambition agenda at the front and centre
  • Increasing climate risk in crucial areas, such as water stress, demand immediate actions that can be hard to process by the political system
  • Political divisions deepening
  • Ongoing COVID19 pandemic diverts key resources

About Climate Diplomacy Snapshots

The data is clear. Accelerated and enhanced action is needed now to build resilience and avoid the worst impacts of climate change. As they seek to address the ongoing health, economic and social impacts of COVID-19, governments should seize opportunities to invest in a recovery that will build social, economic and climate resilience on the long-term.The Climate Diplomacy Snapshots aim to provide the climate community with a clear overview of what each country should do, on climate and recovery, to pursue these joint objectives and keep the global average temperature increase to 1.5°C. Each has been prepared with the help of national experts, and will be regularly updated. The snapshots aim to support climate. advocacy in the lead up to COP26

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