$100bln global climate finance target likely met in 2022, but “much work remains”

The 100 billion U.S. dollars that developed economies aimed to raise annually for climate action in developing countries was likely reached for the first time in 2022, said the Organisation for Economic Cooperation and Development (OECD) based on preliminary figures. However, “much work remains to further scale up and improve climate finance”, said Jennifer Morgan, Germany’s special envoy for international climate action, and Steven Guilbeault, Canada’s environment and climate minister in an open letter. At a press conference, Morgan said that while potentially meeting the target will not “solve everything,” it will hopefully “build some confidence in our commitment to work together with developing countries moving forward.”

In 2021, developed countries mobilised 89.6 billion U.S. dollars according to the OECD, which was higher than the prediction made by the organisation two years ago. This could mean that the 100 billion U.S dollars target, which was originally promised to be mobilised annually between 2020-2025, was met for the first time last year. Mitigation remained the largest share of total climate finance in 2021, at 60 percent, while spending on adaptation was 27 percent and 13 percent on cross-cutting measures. Only 16 percent of the total amount came from private climate finance. Germany reached its own international climate finance goals ahead of time, as the country raised 6.4 billion euros in 2022.

In their open letter, Morgan and Guilbeault emphasise four priorities for climate finance action in the future: The need to encourage adaptation finance; to de-risk investments in sectors and countries that are less attractive to private finance funders, for instance by an increased application of guarantees; to optimise the role played by multilateral development banks (MDBs) in delivering climate finance; and enhancing access for the most vulnerable.