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Climate finance for developing nations rises, study finds

Wealthier countries have been ramping up the amount they spend on helping developing countries undertake initiatives to reduce their impact on climate change.

New figures from the Organisation for Economic Co-operation and Development (OECD) reveal that developed countries spent $78.9bn (£61bn) in 2018, up 11 per cent from $71.2bn in 2017.

The increase was driven by a rise in public climate finance, while private climate finance was flat.

The United Nations wants countries to spend $100bn per year by 2020 to help developing countries tackle and adapt to climate change. However, severely dampened global economic output in the last few months due to the advent of the coronavirus pandemic could prevent this goal from being reached.

“Climate finance to developing countries continues to grow but in 2018 was still $20bn short of the 2020 goal of mobilising $100bn,” said OECD Secretary-General Angel Gurría.

“Early 2019 data from the European Union and its member states, the largest provider taken collectively, indicate that bilateral public climate finance may have continued to increase last year.

“Donors need to urgently step up their efforts to support developing countries to respond to the immediate effects of the pandemic and to integrate climate actions into each country’s recovery from the Covid-19 crisis to drive sustainable, resilient and inclusive economic growth.”

The report shows that out of the overall climate finance in 2018, 70 per cent went to climate change mitigation activities, 21 per cent went to adaptation and the remainder to crosscutting activities.

More than half of total climate finance targeted economic infrastructure – mostly energy and transport – with most of the remainder going to agriculture and social infrastructure, notably water and sanitation.

Over 2016-18, Asia benefited from the largest share of climate finance at 43 per cent, followed by Africa (25 per cent) and the Americas (17 per cent).

In terms of distribution by income group, 69 per cent of climate finance went to middle-income countries, 8 per cent went to low-income countries and 2 per cent went to high-income countries, with the remaining 21 per cent allocated at regional rather than country level.

The US formally exited the Paris Agreement on Wednesday, fulfilling a longstanding promise made by president Donald Trump. However, Joe Biden, who looks likely to win the White House from him, has said he will re-join the agreement as soon as he takes office.

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