Climate finance committed by major multilateral development banks (MDBs) rose to $66 billion in 2020 from $61.6 billion in 2019, a joint report from the MDBs shows.
Development Diaries reports that eight MDBs committed the $66 billion, with low- and middle-income countries getting 58 percent of the amount, according to the report.
The annual report is a key indicator on the progress MDBs are making on accelerating the delivery of climate finance, for which demand is clearly going to grow over time.
This year’s report marks the end of the reporting period tracking individual climate finance pledges since 2015; for most, 2021 will mark the start of a new increase in ambition.
In 2019, at the UN Secretary-General’s Climate Action Summit, MDBs announced their expected joint annual climate action finance to 2025. These include at least $65 billion, with $50 billion of MDB climate finance for low-income and middle-income countries.
‘The MDBs will continue to improve their tracking and reporting of climate finance in the context of their commitments to ensure consistent financial flows to the countries’ long-term, low-carbon and climate-resilient development pathways, as established in Article 2.1 of the Paris Agreement’, the report noted.
Africa, it is understood, has been warming progressively since the start of the last century, and in the next five years, according to the UN World Meteorological Organisation (WMO), northern and southern Africa are likely to get drier and hotter, while the Sahel region gets wetter.
WMO’s Regional Strategic Office Director, Filipe Lucio, had said in October 2020 that Africa needed to take action in terms of adaptation and mitigation.
Climate change contributed to a jump in food insecurity, mosquito-borne disease and mass displacement in the past decade.
Also, the rise in sea levels has led to unusual weather patterns such as Tropical Cyclone Idai, which hit Mozambique, Malawi and Zimbabwe in 2019.
The 2020 financing helped play a key role in supporting countries to embed green and climate-focused solutions as part of their recoveries from the impact of Covid-19.
While these programmes affected MDBs’ normal lending operations and thus the delivery of their climate finance targets, seeing the total commitments for low- and middle-income countries dip from 2019’s $41.5 billion, the 2020 report noted that interventions and support from the MDBs laid a solid foundation for ‘building back better’ for a greener, more resilient, post-Covid-19 future.
The 2020 MDB report, coordinated by the EBRD, combines data from the African Development Bank (AfDB), the Asian Development Bank (ADB), the Asian Infrastructure Investment Bank (AIIB), the European Bank for Reconstruction and Development (EBRD), the European Investment Bank (EIB), the Inter-American Development Bank Group (IDBG), the Islamic Development Bank (IsDB), and the World Bank Group (WBG).
Photo source: Tom Stahl