Understanding the CDM's contribution to technology transfer

Developing countries are increasingly contributing to global greenhouse gas emissions and, consequently, climate change as a result of their rapid economic growth. In order to reduce their impact, the private sector needs to be engaged in the transfer of low-carbon technology to those countries. The Clean Development Mechanism (CDM) is currently the only market mechanism aimed at triggering changes in the pattern of emissions-intensive activities in developing countries and is likely to play a role in future negotiations. In this paper, we analyse how the CDM contributes to technology transfer. We first develop a framework from the literature that delineates the main factors which characterise technology transfer. Second, we apply this framework to the CDM by assessing existing empirical studies and drawing on additional expert interviews. We find that the CDM does contribute to technology transfer by lowering several technology-transfer barriers and by raising the transfer quality. On the basis of this analysis, we give preliminary policy recommendations.