An investment worth $500 million (£330m) will be made to help developing countries implement their greenhouse gas (GHG) emissions reductions plans.
The World Bank made the announcement backed by Sweden, Germany, Norway and Switzerland at the COP21 climate conference in Paris.
The ‘Transformative Carbon Asset Facility’ will create new carbon assets associated with reduced greenhouse gas emission reductions, including those achieved through policy.
It will measure and pay for emission cuts in large scale programmes in areas like renewable energy, transport, energy efficiency, solid waste management and low carbon cities.
World Bank Group President Jim Yong Kim said: “We want to help developing countries find a credible pathway toward low carbon development. This initiative is one such way because it will help countries create and pay for the next generation of carbon credits.”
The UN also launched an initiative to build climate resilience in the most vulnerable countries of the world.