Climate finance is neither charity nor business

Climate change affects the entire planet, even when 70% of the global emissions come from just 30% of the world. Knowing that the contribution to this global crisis has been uneven, seeking even monetary attention seems unfair. 

All the latest reports show that developing countries face a growing financial disparity when fighting climate change. They need more support but are still waiting to receive what has been promised. Additionally, the support being offered is mostly in the form of debts (61% of all climate finance disbursed in 2022), which only adds to their woes. 

Developing countries have different needs for reducing emissions compared to developed nations. Each developing country requires a tailored approach to receive the financial support to contribute to the global net zero emission target. For instance, emerging economies like India, which supported 94% of its RE growth with domestic public funding in 2022, have some vulnerable sectors, like agriculture, that need immediate attention and financial assistance to transition to renewable energy. On the other hand, low-income countries, some of which are also the most vulnerable to climate impact, might need grants instead of loans to pursue global climate goals. Without proper support, developing countries get caught in a cycle of debt, making it almost impossible for them to invest in climate resilience or overall development at all.

Climate change affects more than just the environment. It will shape the world’s future, including energy access, economic prospects, political control, skill development and climate resilience. Therefore, addressing climate change and climate finance requires a comprehensive approach.

We need to redefine climate finance at a fundamental level, clarifying what it means, what it covers, and how nations can benefit from it. Additionally, climate finance should be aimed at creating a climate resilient ecosystem. It should support research, development, and technology for the long run. The window of opportunity to limit global temperature rise is closing, and further delays in levelling the playing field could have irreversible consequences for the world’s future.

In conclusion, climate finance should not be seen as charity or a business opportunity for wealthy countries. Instead, it should be seen as the only fair way to achieve a stable climate and energy efficiency for everyone. This will help them combat climate change’s impacts and pave the way for a sustainable future for everyone on Earth.

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