Thirty-six percent of all World Bank funding over the last year had a climate component, slightly exceeding the bank’s goal of 35% — the target the bank seeks to hit each year through 2025.
The bank also increased its climate finance by 19% year-over-year, bringing the total to $31.7 billion in fiscal year 2022, which ended in June, according to new data the lender released Wednesday. Ahead of the 27th U.N. Climate Change Conference in November, bank officials told Devex they see the increase as a sign of more demand for climate finance coming from countries.
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Breakdown: The bank’s core operating units — the International Bank for Reconstruction and Development and the International Development Association — spent a total of $26.2 billion, with nearly half going to projects to support climate “adaptation and resilience,” to deal with the consequences of climate change.
The remainder came from the International Finance Corporation, the bank’s private sector wing, and the Multilateral Investment Guarantee Agency, a unit providing risk insurance.
Country-led: There is no shortage of climate-related work to fund, but countries set priorities and spearhead projects and will therefore determine the pace of future investments, bank officials said.
“The investment needs are massive,” said Carolina Monsalve, a lead climate change specialist at the bank.
“Our model is demand-driven. ... If we want to finance climate, countries need to do climate,” added Stephane Hallegatte, a senior climate change adviser at the bank.
Not countable: The new Country Climate and Development Reports, launched this year, are a key diagnostic tool to align the lender’s work and countries’ goals, Hallegatte said. The bank will issue 25 country reports annually.
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“We look at development from the lens of climate change, to look at how we want to change on development to achieve our climate goals,” he said, arguing this plays a “critical role” in setting priorities tailored for each country. For example, the diagnostic in the Sahel, a region battered by climate change, is more focused on adaptation.
Advisory services writ large are not reflected in the headline spending numbers, the bank officials noted, but help mainstream the climate agenda.
About the author
Shabtai Gold
Shabtai Gold is a Senior Reporter based in Washington. He covers multilateral development banks, with a focus on the World Bank, along with trends in development finance. Prior to Devex, he worked for the German Press Agency, dpa, for more than a decade, with stints in Africa, Europe, and the Middle East, before relocating to Washington to cover politics and business.
