Climate finance has continued to grow, with developed countries providing and mobilizing US$132.8 billion in climate finance for developing countries in 2023 and US$136.7 billion in 2024, the Organization for Economic Co-operation and Development (OECD) said in a new report on Thursday.
However, the amount of climate finance mobilized is far less than what countries are expected to provide annually from 2035 onwards under the new Collective Quantitative Target (NCQG), according to the OECD report. The OECD is a 38-nation international organization, founded in 1961 to stimulate economic progress, and is mostly made up of high-income countries.
In 2009, at the Fifteenth Conference of the Parties (COP15) in Copenhagen, developed countries committed to the goal of raising US$100 billion annually by 2020 to meet the needs of developing countries. They specified that funding would come from a wide range of sources – public and private, bilateral and multilateral, including alternative sources. The climate finance target was formalized at COP16 in Cancun but will not be achieved until 2022.
In 2024, countries set a new climate finance target, committing to provide at least US$300 billion annually to developing countries for climate action by 2035. This is still far from meeting the financial needs of developing countries to finance their climate action, the Climate Action Network (CAN) said in a statement on Thursday.
He added: “This is against the backdrop of the ongoing US-Israeli war on Iran and throughout the Southwest Asia and North Africa region, which is creating a severe economic shock for developing countries that simultaneously reduces their ability to finance climate action and increases their vulnerability.”
CAN stressed that these figures should be read in the broader context of the sharp cuts in overseas development aid since 2024. HT reported in 2024 that India was particularly concerned about the low NCQG target. Many negotiators from developing countries, including India, described the decision as “too little, too late.” Developing countries have set their needs at no less than US$600 billion annually.
“The OECD report shows that developed countries exceeded the $100 billion target for the third year in a row, but the target was achieved two years too late and remains modest against the NCQG’s new $300 billion target and the ambitious $1.3 trillion target. The report also raises important questions about quality and equity, for example, public climate finance is still dominated by loans, and the share of concessional bilateral loans has declined. Finally, most mobilized private financing continues to flow to middle-income countries and mitigation projects.” “We reiterate that private capital follows bankability and not climate vulnerability or need,” said Sahar Raheja, Program Officer for Climate Change and Green Economy at the Center for Science and Environment (India).
“A further increase in climate finance is urgently needed to support countries and communities in the Global South to confront the climate crisis,” Sven Harmeling, head of climate at CAN Europe, said in a statement. “While the OECD report indicates that such an increase occurred in 2024, many European countries subsequently reduced their spending on climate finance in 2025. These harsh cuts violate their commitments to provide such support, undermine Europe’s reputation as a credible partner, and run counter to Europe’s strategic interests in every sense.” “The word.” word.”
