Understanding the strengths—and weaknesses—of countries’ Nationally Determined Contributions (NDCs) can yield lessons on how these vital climate plans can be improved to help mobilize climate investment. As the gap between climate finance needs and actual finance flows persists, updated NDCs must evolve into credible investment prospectuses, particularly for countries that require conditional finance or seek to encourage both domestic and international investment for NDC implementation.

The third round of NDCs, or NDC 3.0, was to be submitted to the UNFCCC by February 2025. Following the outcomes of the Global Stocktake, this exercise aims to present the latest and most ambitious generation of country-level climate commitments to achieve the goals of the Paris Agreement. Countries are expected to set higher targets and develop clear implementation and financing strategies to attract investment.

As of May 31, 2025, only 22 parties had submitted updated NDCs, with only 15 of these quantifying climate finance needs to some degree. More NDCs are still in development, with many expected to be published in the run-up to COP30.

This gap raises a critical question: Are the new NDCs evolving into investment-ready documents, or do they fall short as actionable roadmaps for climate finance? To help answer this, CPI has developed a new methodology to assess climate investment signals in the new NDCs. We have applied this approach to the first 18 NDCs submitted by non-Annex I parties to the UNFCCC by mid-2025 to provide a snapshot of progress.

What is expected from the NDCs 3.0?

NDCs must address three key aspects: needs, design, and credibility to send strong climate investment signals to markets:

The investment-aligned NDC Needs: What is required to deliver on climate ambition? Translating ambition into action requires knowing what it will cost. Yet in the previous round of NDCs, more than one-quarter of emerging markets and developing economies (EMDEs) did not quantify their climate finance needs. Those NDCs that did quantify climate finance needs vary in granularity. Without clear and credible costing of finance needs, investors cannot assess the scale of required capital, evaluate risks, or identify where and how they can contribute. The inclusion of granular breakdowns of financial needs by sector and project, along with a clear distinction between conditional and unconditional financing requirements, can make the NDCs 3.0 more effective in spurring action. Design: How can NDCs mobilize finance? A well-structured NDC signals opens the door to partnerships with concessional donors and private capital. In addition to articulating needs, NDCs should lay out explicit strategies for engaging private sector investment through mechanisms like green bonds, blended finance, or risk-sharing instruments, and contribute to a well-designed NDC able to signal clear investment opportunities and pathways. Credibility: Do current NDCs offer credible investment prospectuses? Credible NDCs demonstrate alignment between climate commitments and existing national and sectoral policies, ensuring that climate finance needs are embedded within broader development strategies rather than presented as standalone requirements. Additionally, the inclusion of concrete implementation plans and mechanisms demonstrates institutional readiness, supports coordination among implementing partners, and builds trust with funders.

CPI framework to inform progress

To measure progress and inform the development of more investable NDCs, CPI has devised key indicators to assess the quality of the financial components of NDCs. These indicators, described below, aim to outline how NDCs can send strong investment signals, revealing opportunities for NDC submissions and updates. Additional details on the indicators are provided in the methodology document.

This analysis focuses on non-Annex I countries, which face the most significant financing gaps and are most dependent on external investment to implement their climate commitments. The quality of these countries’ investment signals is particularly critical for mobilizing the conditional finance needed to achieve their NDC targets. Of the 22 updated NDCs submitted by May 31, 2025, 18 were from non-Annex I countries. The figure below shows the strength of investment signals for the 18 assessed NDCs across the seven key indicators:

What is working, and what is missing?

Many of the 18 non-Annex I countries that have submitted updated NDCs have strengthened their climate investment signals. However, these documents could be improved even further across most indicators.

Needs: What is required to deliver climate ambition?

There has been progress in quantifying climate finance needs, but challenges remain.

Of the 18 new non-Annex I NDCs, 13 quantify climate finance needs, with five providing granular detail including disaggregated, sector-specific cost estimates. Seven updates also expanded the scope of their needs coverage to encompass a broader range of mitigation and adaptation measures. For instance, Botswana’s updated NDC quantifies adaptation, having previously only estimated mitigation needs. , having previously only estimated mitigation needs.

In addition, 15 new NDCs mention the need for international support, with seven quantifying the support required to some extent. Defining conditionality is critical for determining which NDC commitments depend on international support versus domestic resources.

However, overall, the quantification of needs remains limited. Few identify specific, granular investment needs for sectors or projects, and five updated NDCs do not quantify climate finance needs at all. Without costed needs, it is difficult to attract investments at the required scale.

Design: How can NDCs mobilize finance?

Updated NDCs feature enhanced private sector mobilization strategies, but there are still limited specifics on private investor engagement.

Six NDCs present enhanced private sector mobilization strategies, describing mechanisms to engage investors, identifying priority sectors and referencing instruments such as guarantees, blended finance mechanisms, and public-private partnerships. For instance, Brazil’s new NDC offers a highly detailed private sector mobilization strategy, referencing specific instruments such as sustainable sovereign bonds, climate funds, and a currency hedging program, reflecting a sophisticated approach to engaging financial markets and managing investment risk.

However, eight of the 14 references to private sector engagement in updated NDCs were high-level or unspecific. More detailed strategies can signal to investors that there are concrete pathways for their participation in climate finance.

Credibility: Do current NDCs offer credible investment prospectuses?

Updated NDCs show strong integration with national planning but often require more detailed implementation planning.

A majority of 16 new NDCs mention integration with other national and sectoral plans, helping to reduce duplication, streamline coordination, and signal policy coherence to investors, though with varying levels of detail.

All 18 include a general implementation plan for delivering mitigation and/or adaptation objectives. Five parties strengthened their implementation planning by identifying lead institutions, setting timelines, and outlining specific responsibilities. For instance, Cuba outlines targets, timeframes, responsible institutions, and cost estimates per mitigation measure. This approach provides a clear roadmap for delivery, making it easier for funders to assess the feasibility and financing requirements of each intervention. However, many NDCs require more detail to be investment ready.

That said, only two NDCs demonstrated a high level of implementation planning with detail on implementing bodies, legal frameworks, timelines, budgets, and expected outcomes for specific measures. While countries are increasingly thinking about investment-ready implementation plans, many NDCs could go further in providing an actionable roadmap for delivery in order to build investor confidence and trust.

What is needed next?

Overall, most countries showed limited change across most indicators between their new and previous NDCs. While there were incremental improvements across many indicators, NDCs mostly demonstrated a similar level of investment signals compared to their previous submissions, suggesting that capacity constraints persist for many parties.

These findings emphasize the need for more advanced investment and implementation planning across NDCs and reveal the following recommendations:

Opportunities exist for strengthened investment signals in forthcoming NDCs. Parties that have already submitted their third NDCs can make more use of periodic updates to strengthen these as investment-catalyzing documents.

All NDCs should strive to quantify climate finance needs at the most granular level possible, forming the foundation for investment planning. Many countries, especially EMDEs, face data gaps and capacity constraints that require increased international cooperation and support for both finance provision and NDC preparation.

Development finance institutions and private advisory groups can help strengthen NDC investment planning. They can provide technical expertise, data infrastructure, and capacity-building programs to improve the costing and investment planning of NDCs.