UNFCCC’s Fifth Biennial Assessment and Overview of Climate Finance Flows report.
Upon the request of the COP, the Standing Committee on Finance has prepared and published in November 2022 this Biennial Assessment and Overview of Climate Finance Flows, drawing on the available sources of information, and including information on the geographical and thematic balance of flows. This is a key report for climate negotiations at COP 27 in Egypt, and its consequences on the future of climate investments.
- The world averages USD 803 billion of climate finance flows annually.
- Global climate finance flows were 12 per cent higher in 2019-2020 than in the previous biennium.
- Increase is driven by more investment in energy efficiency in buildings, electric vehicles, and measures to adapt to climate change.
- Climate finance from developed to developing countries increased between 6 per cent and 17 per cent in 2019-2020, either directly from developed to developing countries, or through climate funds and multilateral development banks.
- Finance for mitigation (cutting greenhouse gas emissions) constitutes the largest share of climate-specific financial support, but the share of adaptation finance continues to increase and grew at a higher rate than mitigation finance. In addition, adaptation finance is predominantly delivered through grants, while public mitigation finance predominantly takes the form of loans.
- Ways to track domestic public climate finance are improving in both developed and developing countries.
- A sole focus on positive climate finance flows will be insufficient to meet the overarching purpose and goals of the Paris Agreement, and that finance flows must integrate climate risks into decision-making and avoid increasing the likelihood of negative climate outcomes.