International climate finance mechanisms have often failed to deliver against the climate technology needs of low and middle income countries. This has meant that Africa has lost out on the competitive edge as regards gaining from meaningful climate finance, as most of the benefits of instruments such as the Clean Development Mechanism (CDM) have gone to large developing countries
like China and India. In this context, concerted efforts to build national [and regional] innovation systems around climate technologies can leverage institutions and actors across diverse fields to begin to address this issue. Innovation systems have been proven to explain the economic development of a wide range of countries including all of the OECD countries and the so-called
“Asian Tiger Economies”. Innovation system building approaches have also been demonstrated as underpinning the success of Lighting Africa – which rapidly developed a new market for solar portable lanterns in Kenya – and China’s successful use of CDM funding to foster growth in various areas. This example shows that innovation systems can be useful for – among others – leveraging climate
finance but also improving the quality of projects, and the development and uptake of climate technologies related to such projects.