Developed Countries Fall Behind on Climate Financing Commitments Again

At COP 15 in 2009, developed countries had promised 100 billion USD annually to developing countries.

Developed countries of the world have failed to pay their promised share of climate finance to developing countries yet again, falling short of 17 billion USD. In 2009, richer countries had agreed to provide 100 billion USD annually to developing countries by the year 2020.

Climate finance is the money promised by developed countries to developing countries to support the latter's climate action. Since developed countries have done their share of polluting the world, they have promised time and again to financially assist developing countries to meet their climate goals, say experts.

However, developed countries have failed to meet their promises several times before, according to the recent 'Aggregate Trends of Climate Finance Provided and Mobilised by Developed Countries in 2013-2020' report by the Organisation for Economic Co-operation and Development (OECD), a group funded by the developed world.

In 2009, developed countries had promised to financially assist developing countries in climate action at COP 15 in Copenhagen. The agreement was to provide 100 billion USD annually till 2020. However, developing countries are yet to receive the full amount of the promised climate finance.

Of the promised 10 billion USD, only 83.3 billion USD as climate finance was provided in 2020. In 2021, this amount saw a mere 4 percent increase.

"We know that more needs to be done. Climate finance grew between 2019 and 2020, but as we had expected, remained short of the increase needed to reach the USD 100 billion goal by 2020."

OECD Secretary-General Mathias Cormann

"Africa will continue to put pressure on richer nations to ensure the $100 billion-a-year agreement is fulfilled," Harsen Nyambe, head of the African Union's climate change and environment division, told Associated Press.

He also added that the funds would give the continent better access to required technology and help nations transition to green energy in a fair way while meeting their climate pledges.

Amount Not Fully Paid Even for a Single Year

Developing countries expect that the promised funds under climate finance will be given to them as grants. However, a majority of climate finance has been provided in the form of loans rather than grants, according to the Oxfam Climate Finance Shadow Report 2020.

Developed countries had said that by 2020, they would ensure the payment of 100 billion USD each year. But this amount was never fully paid even for a single year.

At COP 26 in Glasgow in 2021, developed countries got this deadline pushed to 2023, in the hope that they will be able to meet the 100-billion target by this point and then increase the amount thereafter.

Developed countries have been claiming that they are on track to meet the goal of paying 100 billion USD. However, the support has to factor in repayment plans and interest. This has been considered a gravely overlooked scandal.

"Developed countries need to continue to ramp up their efforts in line with their stated commitments in the lead-up to COP26, which would mean the USD 100 billion goal would be reached from next year. This is critical to building trust as we continue to deepen our multilateral response to climate change."

OECD Secretary-General Mathias Cormann

Climate financing loans have increased from 13 billion USD in 2015 to 24 billion USD in just three years.

Climate finance has been an important economic driving force in climate action. It has allowed developing countries to invest further in green technology and take steps to meet their climate goals, especially since they are at far more risk with regard to environmental degradation.