Market-based mechanisms alone will not suffice to finance adequate emission reduction activities. Public finance to seed mitigation activities by building capacity and governance infrastructures and by fostering mitigation policies is vital to enable sufficient private finance for global low-carbon development.
International market-based mechanisms must not compete with domestic action in developing counties. Developing countries must be able to utilize lowest cost mitigation actions towards meeting their own mitigation targets. Furthermore, the use of international credits must remain supplemental to domestic action in developed countries. The design of a
Framework must draw upon the lessons learned and experiences from existing market based mechanisms, such as the CDM, JI and the EU-ETS.