Finance
Rich nations failed to meet $100 bn climate finance promise in 2022: Oxfam
Illustration: Binay Sinha
Rich countries falsely claimed that they provided nearly $ 116 billion in climate finance to developing countries in 2022, while the actual financial support given was not more than $ 35 billion, according to global non-profit organization Oxfam International.
At the 2009 UN climate conference in Copenhagen, rich nations pledged to provide $ 100 billion annually from 2020 to help developing countries mitigate and adapt to climate change. However, delays in achieving this goal have eroded trust between developed and developing nations and have been a continual source of contention during annual climate negotiations.
In May, the Organization for Economic Co-operation and Development (OECD) said that developed countries had met the long-standing $ 100-billion-a-year promise by providing nearly $ 116 billion in climate finance to developing countries in 2022.
However, nearly 70 per cent of this money was in the form of loans, many of which were provided at profitable market rates, adding to the debt burden of already heavily indebted countries.
“Rich countries have again effectively short-changed low- and middle-income countries by as much as $ 88 billion in 2022,” Oxfam said.
Oxfam estimated that the “true value” of climate finance provided by rich countries in 2022 is as little as $ 28 billion and no more than $ 35 billion, with at most only $ 15 billion earmarked for adaptation, which is crucial for helping climate-vulnerable countries address the worsening impacts of the climate crisis.
This discrepancy between financial promises and reality continues to undermine the trust needed between countries and is materially vital, as climate action in many countries depends on this climate finance, it said.
Oxfam’s figures reflected climate-related loans as their grant equivalents, rather than at their face value, in order to gauge rich countries’ real financial effort.
The organisation also accounted for the difference between loans at market rate and those at preferential terms, while also considering the overly generous claims about the climate-related significance of these funds.
Low- and middle-income countries should instead get most of the money in grants, which also need to be better targeted toward authentic climate-related initiatives that will help them adapt to the impacts of the climate crisis and move away from polluting fossil fuels,” Liguori said.
At the moment they’re being penalized twice. First, by the climate harm they did little to cause, and then by paying interest on the loans they’re having to take to deal with it.
Oxfam said its estimates are based on original research by INKA Consult and Steve Cutts using the latest OECD climate-related development finance datasets for 2021 and 2022. Figures are rounded to the nearest 0.5 billion.
According to new data from the OECD, rich countries claimed they mobilized $ 115.9 billion in climate finance for Global South countries in 2022. Nearly $ 92 billion of the reported amount was provided as public finance, with 69.4 per cent of public finance provided as loans in 2022, up from 67.7 per cent in 2021.
According to the United Nations Environment Programme (UNEP), the funds required for adaptation in developing countries are estimated to be between $ 215 billion and $ 387 billion per year this decade.
Climate finance will be at the centre of the UN climate conference in Baku, Azerbaijan, where the world will reach the deadline to agree on the New Collective Quantified Goal (NCQG) the new amount developed nations must mobilize every year starting 2025 to support climate action in developing countries.
However, a consensus on NCQG will not be easy.
Some rich nations argue that countries with high emissions and higher economic capacities, such as China and petro-states that classify themselves as developing countries under the Paris Agreement, should also contribute to climate finance.
Developing countries, however, cite Article 9 of the Paris Agreement, which states that climate finance should flow from developed to developing nations.
Developed countries want the funds to prioritize nations most vulnerable to climate impacts, such as the least developed countries and small island developing states. Developing countries assert that they all deserve support.
Developing nations also demand clarity on what constitutes climate finance, insisting that development finance should not be counted as climate finance and that funds should not be provided as loans, as has happened in the past.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
First Published: Jul 11 2024 | 9:57 PM IST
Finance
New Funding Models Needed As Global Health Faces Growing Financial Strain – Health Policy Watch
Global health is facing a funding crisis. Aid is shrinking, debt is rising, and the needs are only increasing. According to Christoph Benn of the Joep Lange Institute and Patrik Silborn of UNICEF Afghanistan, health systems will need to fundamentally rethink how they finance and sustain care.
On a recent episode of the Global Health Matters podcast, host Gary Aslanyan was joined by these two experts, who said “innovative finance” has become central to discussions on sustaining health systems.
Benn said that while the term is widely used, few agree on what it actually means. He described it as a “spectrum” of approaches, ranging from philanthropic grants and conditional funding to private-sector investment models that expect financial returns.
“It has frustrated us deeply that so many people are talking about innovative finance, but very few actually know what they’re talking about,” Benn said.
Silborn emphasised that these mechanisms should not be treated as one-size-fits-all solutions. Instead, financing models must be designed around specific problems whether that means raising new funds, improving efficiency, or linking payments to measurable outcomes.
Drawing on his experience in Rwanda, Silborn described how a results-based funding model tied disbursements directly to performance, helping the country to maintain progress against major diseases despite reduced funding.
Both experts stressed that private-sector engagement requires a clear understanding of incentives.
“Private corporations are not charities,” Benn said. They can, however, contribute through marketing partnerships, technical expertise, or investment models that align financial returns with social outcomes.
Looking ahead, Benn pointed to targeted taxes and debt swaps as among the most scalable tools. Still, both warned that innovative finance is not a substitute for public responsibility.
“It only works when it is designed to solve real problems in specific contexts,” Benn said, underscoring that strong systems and governance remain essential to any lasting solution.
Listen to the full episode >>
Read more about Global Health Matters podcasts on Health Policy Watch >>
Image Credits: Global Health Matters podcast.
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COLUMBIA, S.C. (WCIV) — Dozens of local elected officials from across South Carolina are urging state lawmakers to pass legislation that would allow cities, counties and school districts to deposit taxpayer funds in the financial institution of their choice, including qualified credit unions.
The Palmetto Public Deposits Coalition, formed by more than 40 mayors, county council members and municipal leaders have signed a joint letter calling on the General Assembly to advance the South Carolina Financial Freedom Act, a bill that, if signed, would lift long-standing restrictions that require public entities to deposit funds exclusively in commercial banks, even though state law already allows credit unions to accept public deposits.
The coalition argues the current system limits competition and prevents local governments from seeking potentially better rates, lower fees and more responsive service.
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“Local governments should have the same financial freedom that families and businesses have — the ability to choose the financial institution that best meets their needs,” Rick Osborn, chairman of the Palmetto Public Deposits Coalition, explained. “This commonsense reform will introduce healthy competition, help stretch taxpayer dollars further, and strengthen partnerships with community-focused financial institutions that are deeply invested in South Carolina.”
The efforts also won support from the South Carolina Association of Counties and the Municipal Association of South Carolina, whose boards have formally endorsed expanding deposit options. Their backing signals broad agreement among local government officials that the law should be modernized.
In their letter to lawmakers, the coalition argued that permitting credit unions to hold public deposits would restore financial choice and improve outcomes for residents.
“This legislation is about giving local leaders more tools to serve residents effectively and make responsible financial decisions,” said Goose Creek Mayor Greg Habib, one of the signatories.
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The Financial Freedom Act would allow, but not require, public entities to deposit funds in qualified credit unions. Coalition members said the bill is not designed to favor one type of institution over another, but to encourage competition in a market currently limited to commercial banks, many of which operate outside the state.
The Palmetto Public Deposits Coalition said it will continue working with local leaders, state associations and lawmakers as the legislation moves through the current session.
The FTSE 100 (^FTSE) was hovering around the flatline on Friday, while European stocks headed lower, as traders shrugged off Donald Trump’s latest pause on striking Iran’s energy infrastructure.
On Thursday night, the US president extended the deadline for Iran to open the strait of Hormuz by 10 days, meaning the new date would be 6 April. He claimed that talks were “going very well”. However, Iran denied it was “begging to make a deal”, despite Trump’s earlier claims.
It comes after Wall Street posted its biggest daily loss since the Iran war began on Thursday.
The Wall Street Journal also reported on Thursday that the US was considering sending as many as 10,000 additional troops to the Middle East.
Tony Sycamore, market analyst at IG, said Trump has extended the uncertainty gripping markets.
“While the rhetoric around de-escalation and dialogue is certainly preferable to outright conflict, the market appears to be growing increasingly numb to President Trump’s verbal reassurances. By extending the deadline, it effectively kicks the can down the road, pushing back any concrete resolution regarding the reopening of the Strait of Hormuz. This, in turn, simply extends the uncertainty weighing on markets and the broader global economy.”
Elsewhere, UK retail sales dipped by 0.4% in February, following a rise of 2.0% in January, the Office for National Statistics revealed. In the December to February quarter, sales volumes were up 0.7% compared with the previous three months.
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London’s benchmark index (^FTSE) was hovering around the flatline in early trade
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Germany’s DAX (^GDAXI) dipped 0.5% and the CAC (^FCHI) in Paris headed 0.2% into the red
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The pan-European STOXX 600 (^STOXX) was down 0.3%
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Wall Street is set for a muted start as S&P 500 futures (ES=F), Dow futures (YM=F) and Nasdaq futures (NQ=F) were all lacklustre.
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The pound was 0.1% down against the US dollar (GBPUSD=X) at 1.3311
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