MDBs’ Global Climate Finance Reaches Record High in 2023

Multilateral Development Banks (MDBs) have announced a record $125 billion in global climate finance for 2023, marking a significant increase compared to previous years.

According to an ADB press release, the 2023 figure is more than double the amount provided in 2019, when MDBs first committed to increasing climate finance at the United Nations Secretary General's Climate Action Summit.

"We are pleased that MDBs delivered record climate finance last year, every dollar of which plays a crucial role in reducing carbon emissions and helping communities prepare for the impacts of climate change," said Bruno Carrasco, ADB's Director General for Sustainable Development and Climate Change.

However, Carrasco noted that a large financing gap remains, and ADB is committed to collaborating with other MDBs and independently to increase climate finance for developing member countries.

In 2023, approximately $74.7 billion of MDB climate finance was allocated to low- and middle-income countries, with 67% dedicated to climate change mitigation and 33% for adaptation. Meanwhile, private finance mobilised for these economies totalled $28.5 billion.

For high-income economies, $50.3 billion was provided, with 94% going towards mitigation and the remaining 6% for adaptation. Private finance mobilised for these countries stood at $72.7 billion.

This announcement comes ahead of COP29, set for November 2024 in Baku, Azerbaijan, where global climate finance and the new collective quantified goal on climate finance will be key discussion points.

The annual Joint Report on Multilateral Development Banks' Climate Finance, coordinated by the European Investment Bank (EIB), includes data from various MDBs, including the Asian Development Bank (ADB), World Bank Group, and others. The report tracks progress on their climate finance commitments, such as those made at COP21.

The ADB remains committed to building a sustainable, resilient, and inclusive Asia-Pacific region, continuing its efforts to combat extreme poverty. Established in 1966, ADB is owned by 68 members, 49 of which are from the Asia-Pacific region.