The 2019 report shows that $46.6 billion – or 76% of total financing for the year – was devoted to climate change mitigation investments that aim to reduce harmful greenhouse gas emissions and slow down global warming. Of this, 59% went to low- and middle-income economies.
The remaining $15 billion, or 24%, was invested in adaptation efforts to help countries build resilience to the mounting impacts of climate change, including worsening droughts and more extreme weather events, such as extreme flooding and rising sea levels. 93% of this finance was directed at low- and middle-income economies.
Additional climate funds channelled through MDBs, such as the Climate Investment Funds (CIF), the Global Environment Facility (GEF) Trust Fund, the Global Energy Efficiency and Renewable Energy Fund (GEEREF), the European Union’s funds for Climate Action, and the Green Climate Fund (GCF), play an important role in boosting MDB climate financing. In 2019, the MDBs reported a further $102.7 billion in net climate co-finance – investments from the public and private sector – taking total climate activity financed in the year to $164.3 billion.
The report shows that the MDBs are on track to deliver on their increased climate finance levels. In New York in 2019, the MDBs’ high-level statement highlighted that their global annual climate finance was expected to collectively total at least $65 billion, with $50 billion for low- and middle-income countries by 2025, and that MDB adaptation finance was expected to double to $18 billion by 2025.
This year’s enhanced reporting is in line with the commitments made at last year’s summit, presenting MDBs’ global climate finance data in a transparent, consistent and comprehensive manner. The MDBs have reported on climate finance since 2011, based on a jointly developed methodology for climate finance tracking. The MDBs’ provision of climate finance contributes to fostering global financial flows consistent with development pathways that reduce greenhouse gas emissions and are resilient to climate change.
The 2019 edition of the Joint Report on Multilateral Development Banks’ Climate Finance is being published in the midst of the COVID-19 pandemic, which has caused significant social and economic disruption, temporarily reducing global carbon emissions to 2006 levels. Countries are now facing parallel threats from COVID-19 and climate change, but this also represents a unique opportunity to “build back better” by planning investments for more sustainable systems in place of the current carbon-intensive approach. Global commitment is necessary to deploy financial resources, such as stimulus and recovery packages to help build inclusive, low-carbon and climate-resilient economies.