Climate finance, the EU finally opens its portfolio: +24% in 2022

Climate finance data provided by the EU Council

(sustainabilityenvironment.com) – In 2022, the European Union increased its contribution to global climate finance by 24% compared to the previous year. From EUR 23 billion in 2021, the flow of resources to countries most vulnerable to the climate crisis has risen to 28.5 billion. Thus helping to fill the gap that still separated the richest countries from the target of 100 billion dollars per year agreed in 2009.

This objective, according to preliminary calculations by the Organisation for Economic Cooperation and Development (OECD) published last week, should have been finally achieved in 2022, even if two years later than the initial goal of 2020. During the Cop26 in Glasgow, the OECD itself had warned that the gap was still considerable, in the order of just over 10 billion dollars a year. The EU, on its own, would therefore have contributed about half of the amount needed.

Climate finance turnaround

The European effort comes in response to calls to honor promises. And it reverses the course in mobilizing climate finance. From 2019 to 2021, in fact, the funds made available by Brussels had not changed, remaining in a range between 23.4 billion in 2019 and 23.04 billion in 2021. Moreover, in the 6 years between 2016 and 2021, EU climate finance increased by only 16%.

read also Climate negotiations, EU priorities at COP28

In 2022, more than 54% of the EUR 28.5 billion of public funding for developing countries was devoted to climate adaptation or cross-cutting actions (involving both climate change mitigation and adaptation initiatives), with almost half of the total funding (almost 49%) in the form of grants,” the European Council explains in a statement.

A necessary balance, between grants and loans, to avoid weighing too much on the budgets of countries with economies already fragile and put under further pressure precisely because of the climate crisis. Just as it is a necessary balance between funds for mitigation measures – which are more of interest to donor countries, major polluters, than to beneficiaries – and those of adaptation – that produce concrete results on site and limit the local impact of climate change.

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