Report on barriers for sectoral entry points by country groups

Abstract

This deliverable examines political economy barriers to climate policy through sectoral entry points that can make transitions more just, feasible, and developmentcompatible. It focuses on three areas where governance and politics strongly shape outcomes: coal transition strategies, carbon pricing, and international finance. Across these domains, the report draws on seven peer-reviewed studies and working papers to highlight five strategic entry points: i) decentralized just transition planning, ii) clean industrial development, iii) revenue recycling with social protection, iv) strategic framing and coalition building for carbon taxes, and v) equity-focused international finance reforms. Coal transitions are shown to depend on domestic contexts. Comparative analysis of 12 coal-relevant countries reveals six distinct clusters of political economy dynamics, ranging from civil society-driven transition in South Africa to contested transition pathways in India and Indonesia. Case studies stress the need for regionally tailored approaches. Carbon pricing is politically viable when embedded in broader fiscal or political agendas. Evidence from 46 global policy attempts underlines the role of coalitions, leadership, and framing co-benefits. Microsimulations for 16 Latin American and Caribbean countries show regressive impacts, with many highly affected households lacking social protection. The international finance analysis assesses the G7 pledge and Clean Energy Transition Partnership, tracking shifts in public finance for energy across income groups. While fossil fuel support has declined, clean energy funding has not risen proportionally, remains loan-heavy, and is concentrated in wealthier nations. Low-income countries receive negligible concessional flows, while G7 members continue expanding domestic fossil infrastructure. The study recommends embedding distributive justice into finance governance, scaling grant-based clean energy support for the Global South and aligning domestic actions with international commitments.