100 billion / International climate finance / Pledges & Commitments / UNFCCC
Rich countries’ efforts: less than a third of reported $116bn in climate finance
Just in time for the recent Bonn climate talks, the OECD reported that climate finance to support developing countries had reached nearly $116 billion in 2022. Yet, as a new estimate shows, the actual effort by developed countries in providing climate finance in 2022 has been less than a third and possibly less than a quarter of what officially reported figures seem to suggest.
As per the recently published OECD update, developed countries report a level of $116 billion in climate finance for 2022, finally reaching and surpassing the $100 billion level originally promised for 2020. Exceeding the $100 billion for the first time may seem like cause for relief, but fundamental criticisms remain, such as that most of the finance provided comes in the form of loans that can exacerbate the already crushing debt burden in climate-impacted countries; or that there is still no balance between mitigation and adaptation; or that not a cent of the $116 billion is accounted for as support to address unavoidable losses and damages due to the climate crisis.
Actual net support: $35 billion at best
A new Oxfam estimate now shows that the actual effort by developed countries in providing climate finance in 2022 was much lower. As per this estimate, Climate-Specific Net Assistance (CSNA) stood at $28-35 billion in 2022, less than a third or even less than a quarter of what officially reported figures seem to suggest. For supporting adaptation, Oxfam estimates that the actual effort by developed countries was $15 billion at best.
Figure 1: Reported climate finance versus Climate-Specific Net Assistance, 2021-2022 |

The red bars show reported climate finance as compiled by OECD. The orange and green bars show estimates of CSNA, rounded to the nearest 0.5 billion US$ and based on the climate-related development finance datasets by the OECD. The orange bars use the standard OECD method for grant equivalent accounting that however uses unrealistic discount rates. The green bars use Oxfam’s more robust grant equivalent methodology for more accurate accounting of financial effort by contributors. Lighter shading indicates the range between low and high estimates. See Oxfam’s Methodology Note for details.
The stark difference to the $116 billion in officially reported climate finance is rooted in the lenient reporting rules by which developed countries report climate finance they provide under the UNFCCC and the Paris Agreement. This leads to reporting that overstates the value of support provided by a significant margin. The problem arises from two key issues: Firstly, climate finance continues to be dominated by loans. Developed countries report loans at their face value, rather than by the underlying financial effort they undertake (e.g., to subsidise the interest rate to offer the loan at preferential terms). Secondly, the climate relevance of reported finance is often exaggerated, so that reported volumes do not reflect the components or proportions of provided funds specifically directed at climate action. The impact of these two issues has been reflected in the Oxfam estimate – with a view to better reflect the actual financial effort made by developed countries to provide finance in support of climate action, and to provide a better foundation for measuring progress towards developed countries’ obligations under Articles 4.3 and 4.4 of the UNFCCC and Article 9.1 of the Paris Agreement to provide financial support to meet the cost of action in developing countries.
To make the estimate, Oxfam has used data from the OECD datasets on climate-related development finance, discounted funds for climate-relevance (e.g., counting only a proportion of projects where either mitigation or adaptation were only a secondary) and then estimating the financial effort behind funds provided in the form of loans and other non-grant instruments (e.g., calculating the grant equivalents of loans), using realistic discount rates to reflect the actual cost of borrowing for countries issuing loans. See Oxfam’s Methodology Note for details.
Table 1: Climate-Specific Net Assistance (CSNA) by theme, 2021-2022 | ||||||
Thematic area |
2021 |
2022 |
||||
Reported Climate Finance | CSNA (OECD GE) |
CSNA | Reported Climate Finance |
CSNA (OECD GE) | CSNA | |
Adaptation |
24.6 |
10.3-12.2 |
8.9-10.5 |
32.4 |
13.8-17.2 |
12.7-14.9 |
Mitigation |
53.8 |
9.4-10.6 |
7.8-8.9 |
69.9 |
15.9-18.3 |
11.4-13.1 |
Cross-cutting |
11.2 |
3.3-5.7 |
3.2-5.4 |
13.6 |
4.3-8.2 |
3.8-7.0 |
Total |
89.6 |
23.0-28.5 |
19.8-24.8 |
115.9 |
35.0-43.7 |
27.9-34.9 |
Amounts in billion US$. ‘CSNA’ shows Oxfam’s central estimate,‘CSNA (OECD GE)’ shows the estimate using the standard OECD method for grant equivalent accounting that however uses unrealistic discount rates. Source: Reported climate finance from the recently published OECD update, Oxfam calculations, see Oxfam’s Methodology Note for details. |
It is important to understand that the estimate is not contesting the technical quality of consolidating reported climate finance figures as, for instance, undertaken by regular reports by the OECD on progress towards the $100 billion goal. But the estimate indicates that the actual financial effort by developed countries to support climate action in developing countries is vastly lower than officially reported figures seem to suggest.
NCQG: Mounting pressure on developed countries
Developed countries’ actual efforts are vastly lower than appears to be the case when looking at the $116 billion figure, with the flawed accounting of loans at face value being the key problem. What’s more, non-concessional loans (that constitute a large proportion of the total amount reported) often come at terms that allow the developed country issuing the loan to even make profit. Yet, such loans are reported in full as climate finance. This contradicts the fundamental principles of climate justice and the spirit behind the obligations for developed countries to provide assistance under the UNFCCC and the Paris Agreement.
The New Collective Quantified Goal (NCQG), to be adopted at COP29 in Baku later this year and replacing the $100 billion goal for the time after 2025, allows for correcting these shortcomings in accounting for climate finance. Clearly, much higher amounts of provided finance must come as grants and highly concessional loans, to reflect the needs of developing countries without driving them deeper into debt.
Also, accounting standards under the Paris Agreement should be updated to ensure the true financial effort of providing such loans, and not just their face value, is properly reflected. This would not only allow to enhance transparency on the support effort by developed countries (and thus be a better measure for progress towards existing obligations under the UNFCCC and the Paris Agreement), but also allow for much better comparison between developed countries to ensure they all provide their fair share to climate finance. This can help to put pressure on current laggards.
Jan Kowalzig, Oxfam