Total climate-specific financial support, by receiving region per capita (current USD/capita)(OECD 2023d):

• Northern America and Europe
• Latin America and the Caribbean
• Central Asia and Southern Asia
• Eastern Asia and South-eastern Asia
• Western Asia and Northern Africa
• Sub-Saharan Africa
• Oceania

Applies to:

• DC_FIN_CLIMT

This disaggregation displays the distribution of the total amount of climate finance by the 7 UN regions (M49) (including per capita). It enables the identification of the main recipient regions of international climate finance flows and the less endowed ones.

It can help assess the need to allocate new and additional resources to the countries most affected by climate change and those experiencing weak economic integration and a lack of resources for responding to climate change challenges.

This disaggregation is in line with the UNFCCC – Article 4(UNFCCC 1992) and the Paris Agreement – Article 9 (UN 2015b).

Some regions only contribute marginally to GHGemissions yet they are the most affected by the impacts of climate changeand lack sufficient resources to respond to those challenges. For these countries, the poverty-climate change nexus is a major cause of concern. Climate change exacerbates the vulnerability of poor communities by decreasing access to drinking water and natural resources, cutting down their livelihoods, negatively affecting their health and food security, or submerging coastal areas.The funding support provided by international donors to targeted regions may be the opportunity to support investment that will address both poverty and climate change through adaptation projects. For example, land restoration, securing water supplies and food production and preparedness for climate extreme events. These can strengthen the resilience and empowerment of beneficiary populations(African Development Bank [ADB] 2009).

Total climate-specific financial support provided, by type offinancial instrument (Billions of current USD)(UNCTAD 2022):

• Grants
• Loans
• Equity

Applies to:

• DC_FIN_CLIMT

By cross-checking the composition of climate finance flows, decision-makers will get a clearer idea of the type of financial instruments that are most suitable for further funding. There are a variety of climate finance instruments that have their own objectives in terms of minimizing investment risks, repayment conditions and concessionality levels. The mix of these should be optimized to support climate interventions.

This disaggregation is in line with the UNFCCC – Article 4(UNFCCC 1992) and the Paris Agreement – Article 9(UN 2015b).

While developed countries are committed to mobilizing US$100 billion dollars per year through to 2025 for climate action in developing countries under the UNFCCC(UNFCCC 2010), the Intergovernmental Panel on Climate Change (IPCC) estimates that US$1.6 trillion to US$3.8 trillion dollars per year will be needed up to 2050 to ensure a low-carbon pathway(UN-DESA 2018).

This financing is necessary to enable the transition of developing countries and their various economic sectors responsible for GHG emissions and prevailing consumption patterns towards an economic system and living conditions aligned with the Paris Agreement objectives. It contributes to mitigating climate change impacts with significant expected benefits for human activities and settlements (e.g. a reduction in flood damage) and the natural environment (e.g. prevention of biodiversity loss). It also aims to support adaptation policies and interventions that reduce climate change risks and preserve the sustainable livelihoods and decent living conditions of the poorest, including women and minorities(ADB 2009; UN-DESA 2024).

Although it is preferable to provide LDCs with grants rather than loans to finance their climate projects –to minimize the consequences of debt –the greatest part of public climate finance is still delivered through loans (71.4% in loans vs. 26.3% for grants in 2020). Opportunities are also expected from new and innovative financial instruments (e.g. blended finance, carbon-markets, climate insurance, or the new Loss and Damage Fund)(UNCTAD 2022).

Global climate finance flows by end-use sector(billions of current USD)(UNFCCC 2022b):

• Renewable energy
• Sustainable transport
• Building and infrastructure
• Industry
• Other sectors - mitigation
• Adaptation public finance
• Both mitigators and adaptation
• Domestic climate-relate public investment

This disaggregation describes the sectors that benefit most from international aid and those that receive insufficient aid.It is relevant for policymakers to adjust fund allocations accordingly. The major ‘users’ of these funds are the energy, transport and housing-infrastructure sectors (due to the massive investment needed in those sectors to address the climate change challenges and meet the objective of a low carbon economy). As such, there is growing concern for other types of interventions relying notably on nature-based solutions or ecosystem-based approaches to expand and be the subject of greater attention from both institutions and business decision-makers(UNFCCC 2022b).

This disaggregation is useful for better understanding the final use of climate finance and beneficiary sectors.
Adaptation and resilience strengthening projects are particularly important for LDCs and their populations, who suffer the most from the impacts of climate change and lack the necessary resources and capacity to effectively face those threats. In recent years, a significant share of adaptation finance was spent in the water sector; disaster-risk management; capacity building; Agriculture, Forestry and Other Land Use (AFOLU); and transport sector. These are of direct interest to the population, particularly the poor and women who are the most vulnerable to climate changes consequences(UNFCCC 2022b). However, in the absence of recognized metrics and reporting, it is still difficult to measure the real outcomes of those investments for the population.