In this interview, Stelios Grafakos, Principal Economist at GGGI’s Center for Thought Leadership and Innovation, unpacked key questions about GGGI’s guide, Aligning Climate and Economic Planning: A Guide for Integrating Macroeconomic and Financial Dimensions. The guide provides a practical framework for integrating macroeconomic and financial considerations throughout the national climate policy cycle, including the development and implementation of NDCs, LT-LEDS, green growth strategies, and climate finance planning processes.

The publication responds to the challenge of moving from planning to implementation: as countries strengthen their climate commitments, turning climate plans into action requires more than ambition alone.

1. Countries have made important progress in setting climate commitments, but the implementation challenge is becoming more urgent. How does GGGI see this shift from climate ambition to delivery?

Climate planning has entered a new phase. Many countries have developed or updated NDCs, LT-LEDS, green growth strategies, climate finance plans, and sectoral policies. This is an important achievement. However, the next challenge is increasingly about delivery: whether those plans can be costed, financed, reflected in budgets, and implemented through real investment and institutional action.

From GGGI’s perspective, climate planning can no longer be treated mainly as an environmental planning exercise. Climate action affects the whole economy, including public expenditure, investment needs, employment, trade, industrial development, fiscal revenues, resilience, and long-term competitiveness. At the same time, economic conditions and public finance constraints influence whether countries can mobilize the resources needed to implement climate priorities.

This is why GGGI developed the guide. It helps governments and their partners connect climate ambition with macroeconomic analysis, financial planning, fiscal policy, investment prioritization, and monitoring. The aim is to support climate plans that are not only ambitious but also economically feasible, financially realistic, and institutionally implementable.

Figure 1: Simplified interrelationships between climate, macro-economy and finance

2. What is the main purpose of the guide, and who should use it?

The guide is a practical support tool for stakeholders and government officials involved in climate policy design, financing, implementation, and technical support. It does not replace an NDC, LT-LEDS, green growth strategy, or climate finance plan. Instead, it helps improve those processes by making them more economically grounded, financially credible, and ready for implementation.

The main users are Ministries of Environment or Climate Change, Ministries of Finance, Economy and Planning, sector ministries, climate finance units, technical modelling teams, and development partners. The guide is also intended for government officials, sectoral experts, technical specialists, and partners involved in climate policy design and financing.

For climate ministries, it helps integrate economic evidence, investment needs, finance considerations, and implementation requirements from the start. For finance and economy ministries, it clarifies how climate action relates to fiscal planning, public investment, budget systems, financial instruments, debt sustainability, and macroeconomic stability. For sector ministries, it helps assess the costs, benefits, investment needs, employment effects, co-benefits, and implementation risks of sectoral climate measures.

For technical experts, the guide identifies where analytical tools can inform policy choices, including macroeconomic modelling, cost-benefit analysis, employment assessment, fiscal analysis, climate finance gap assessment, adaptation analysis, and loss and damage assessment. For development partners, it provides a structured way to identify where countries may need support, from data and modelling to finance strategies and budget integration.

The benefit is that all these actors can work together in a coordinated fashion under a shared framework. The guide helps make climate planning and implementation a whole-of-government process, rather than a document prepared by one ministry and implemented later by others.

3. When should governments and other practitioners use the guide in relation to NDCs, LT-LEDS, green growth strategies, and climate finance plans?

The guide can be used at different points in the climate policy cycle. Countries do not need to apply every part at once. They can use it depending on their planning stage, capacity, needs, data availability, and policy priorities.

During NDC enhancement, the guide can help governments move beyond identifying mitigation and adaptation actions and setting emission reduction targets and adaptation objectives. It supports assessment of investment needs, analysis of socioeconomic benefits, employment impacts, and fiscal implications, estimates of the financing gap, identification of financing mechanisms and implementation arrangements. This makes the NDC more credible because it shows not only what the country wants to achieve, but also what the economic implications of the proposed actions are and how they could be financed and implemented.

During LT-LEDS development, the guide can help countries compare long-term transition pathways and assess their macroeconomic implications, including effects on growth, employment, public revenues, trade, investment, human capital development, and structural transformation.

During the preparation of climate finance plans, the guide can help align climate action with national development objectives, prioritize investments, map existing finance flows, assess financing gaps, and identify public, private, blended, fiscal, regulatory, and international finance instruments.

During implementation and review, the guide helps governments assess whether climate priorities are reflected in national budgets, whether resources have been allocated, whether financing instruments are operational, whether finance flows are being tracked, and whether climate and socioeconomic outcomes are monitored together.

In short, the guide is useful from strategy design to financing, budgeting, implementation, monitoring, and revision. It is not a substitute for national climate plans; it is a practical companion that helps make them more credible, financeable, and implementable.

4. The guide is designed in five stages, and what does each stage help users do?

The guide is organized around five interconnected stages that help users move from institutional coordination and analysis to financing, implementation, and monitoring in a coherent process.

Stage 1 focuses on governance and coordination. It encourages countries to engage Ministries of Finance, Economy, Planning, sector ministries, and other relevant actors early in the climate planning process. This helps avoid treating finance as a late-stage issue and instead makes economic and financial planning part of climate policy from the beginning.

Stage 2 focuses on the policy landscape and economic context. It guides users to examine the national economy, existing climate and development policies, economic risks, data availability, and analytical needs. This helps countries understand whether existing policies enable or constrain climate action and which type of analysis is most useful for ensuring policy coherence.

Stage 3 is the analytical core of the guide. It focuses on integrated macroeconomic analysis across mitigation, adaptation, and loss and damage. This includes assessing how climate interventions may affect GDP, employment, fiscal stability, investment, trade, balance of payments, human capital, gender equality, social inclusion, and climate-related economic losses.

Stage 4 focuses on finance and fiscal analysis. It helps countries estimate investment needs, assess current climate finance flows, identify finance gaps, prioritize investments, and consider financial sources and instruments such as public and private finance, blended finance, green bonds, carbon pricing, fiscal incentives, regulatory tools, and international climate finance.

Stage 5 focuses on implementation and monitoring. It helps governments integrate climate finance plans into macroeconomic frameworks, connect climate strategies to national budgeting processes, allocate resources, adapt implementation to changing economic conditions, and monitor climate and development outcomes.

The stages are not meant to be rigid or strictly sequential. Countries can start where the need is greatest, whether that is estimating investment needs, assessing finance gaps, integrating climate priorities into the budget, or developing an integrated monitoring system.

Figure 2: Integration of economic and financial issues into climate planning and implementation

5. What makes this guide different from other climate planning guidance, and what is the main message for policymakers?

There are many useful resources on NDC enhancement, LT-LEDS preparation, adaptation planning, climate finance, and modelling tools. However, many focus on one policy document, one part of the planning process, or one analytical tool.

The added value of this guide is that it brings these elements together into a single practical framework. It does not focus only on NDCs, only on LT-LEDS, or only on finance. Instead, it follows the wider climate policy cycle and shows how macroeconomic and financial considerations can be integrated from governance and policy analysis through to modelling, financing, budgeting, implementation, and monitoring.

Another important feature is that the guide covers mitigation, adaptation, and loss and damage together. This matters because countries increasingly need to understand not only the costs of reducing emissions, but also the economic value of adaptation, the financial implications of climate-related losses, and the links between climate action and development outcomes.

The guide also complements GGGI’s wider analytical work. GGGI’s related work helps countries understand what analytical tools are available. This guide explains when, where, why, and by whom those tools could be used in the policy process while providing good practices examples from different countries. In other words, the analytical toolbox helps answer, “What tools can we use?” The guide helps answer, “How do we use those tools to improve real climate planning, financing, and implementation decisions?” GGGI has highlighted the importance of embedding macroeconomic and financial analysis into climate planning and implementation by providing a suite of tools and methods that countries can pick and customise to their needs, while also learning from the good practices included in the guide.

The main message for policymakers is straightforward: climate plans and strategies could become more credible not only in terms of ambition, but also in terms of delivery. That means climate priorities need to be grounded in countries’ macroeconomic realities and linked to economic planning, fiscal systems, investment decisions, financing instruments, and monitoring frameworks.

The guide helps countries do exactly that. It turns climate planning from a target-setting exercise into a more practical, financeable, and implementable coherent process for green growth and climate resilience.

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