Top climate aid recipients in 2013

As developed and developing countries alike pledged contributions to the Green Climate Fund at the U.N. Climate Change Conference in Lima, Peru, which ended over the weekend, the urgency of mobilizing climate finance was further emphasized. But the lack of a clear definition for climate finance may complicate just how — and where — this money will be spent. The Organization for Economic Cooperation and Development, for instance, considers projects whose primary or secondary objective includes climate or the environment as climate-related activities. Using this definition, OECD-Development Assistance Committee members committed nearly $21.9 billion in climate finance in 2013. These commitments were mostly in the infrastructure sector. Rail transport ($4 billion), environmental policy and administrative management ($1.7 billion), power generation ($1.4 billion), electrical transmission and distribution ($984.4 million) and multisector efforts ($941.9 million) were the five areas in which climate assistance was concentrated. The 10 top bilateral donors to climate finance that year were Japan ($7.3 billion), Germany ($4 billion), the European Union ($2.8 billion), France ($2 billion), Norway ($985.5 million), the United Kingdom ($778.8 million), the Netherlands ($737.1 million), Sweden ($596.2 million), the United Arab Emirates ($574 million) and Switzerland ($546.6 million). A newcomer to both the DAC and the top climate donors list, UAE focused its efforts on solar energy projects ($165 million). Switzerland, meanwhile, devoted much of its climate aid to environmental policy ($72.7 million). While Australia and Canada, which were expected to be more tepid about their climate-related efforts, dropped from the list, Australia still figures among some of the top climate finance recipients’ largest donors. The United States, however, is not included among these donors. According to OECD, the United States is currently revising its figures for a new data screening process that will improve its application of the Rio markers to its activities. This will enable the United States to provide its 2010 to 2013 data to the DAC. Meanwhile, the top recipients of climate aid were India, Bangladesh, Vietnam, Morocco, the Philippines, South Africa, Indonesia, Turkey, Kenya and Ethiopia. That many of the largest recipients of climate finance are lower-middle-income countries and that at least two — South Africa and Turkey — are even upper-middle-income countries seem to suggest that, as a recent study by the Overseas Development Institute has found, climate finance has not been channeled toward countries that need it most. In most of these countries, loans were the primary financial instrument for climate aid. For Turkey, Kenya and Ethiopia, however, grants were the main mechanism for financing climate-related projects. India ($3 billion) The bulk of climate aid committed to India came from Japan ($2.8 billion) and was devoted to rail transport ($2.8 billion). The three largest projects — all transport-related — were financed by Japan alone. Water supply ($145.9 million), rural development ($12.8 million), urban development and management ($11.8 million) and power generation ($7.7 million) were the next largest sectors in which climate assistance was concentrated. Bangladesh ($1 billion) The majority of climate aid commitments to the South Asian country were directed toward the Bheramara combined cycle power plant development project ($425 million), which aims to provide a stable power supply for western Bangladesh, where there is high demand for electricity. Again, Japan dominated the climate donor list, committing as much as $949 million to Bangladesh. France ($45.3 million), Netherlands ($18.4 million), Germany ($14.8 million) and the United Kingdom ($10.7 million) were Bangladesh’s next four top climate donors. Vietnam ($1 billion) Large sanitation systems ($291.2 million) and environmental policy and administrative management ($232 million) were the top two sectors for climate-related projects in Vietnam. While relatively small compared with other bilateral donors — Japan, Germany, Belgium and Australia committed amounts ranging from $33.3 million to $684.6 million — South Korea was among Vietnam’s top five donors to climate activities, committing $24.5 million last year. Morocco ($831.9 million) Morocco’s climate projects were largely involved in rail transport ($293.8 million). Urban development and management ($199.2 million), major sanitation systems ($110.6 million), large water supply systems ($95.7 million), and agricultural policy and administrative management ($79.7 million) were the next priority sectors for climate aid. France ($533.7 million) was the country’s largest donor, followed by Japan ($112.3 million), the European Union ($79.7 million), Germany ($74.3 million) and Belgium ($25 million). Philippines ($697.1 million) One of the countries most vulnerable to climate change, the Philippines is perhaps unsurprisingly part of this list. But a closer look at where the money is going shows that rail transport ($444.9 million) gets the bulk of climate-related aid, while flood prevention and control ($24.4 million) only receives a meager amount. Japan and South Korea — two countries with sour relations but with close ties with the Philippines — are the country’s two largest donors, committing $572.1 million and $103.8 million, respectively. South Africa ($682.3 million) Urban development and management ($277.5 million) and solar energy ($232.2 million) were the two largest areas for climate aid in South Africa. Multisector aid, with $133 million, was also a significant area for climate projects. France ($403 million), the European Union ($132.8 million), Germany ($118.8 million), Switzerland ($7.8 million) and Norway ($7.5 million) were the country’s five top climate donors. Indonesia ($656.2 million) Climate-related aid to Indonesia was largely concentrated in rail transport ($167.4 million), followed by urban development and management ($120.3 million), transport policy ($99.2 million), environmental policy and administrative management ($62.7 million), and geothermal energy ($52.3 million). Unlike the Philippines, Indonesia received a significant share of aid for flood prevention and control, with around $37.4 million for these efforts. Indonesia’s largest climate donors were France ($267.7 million), Japan ($136.5 million), Germany ($129 million), Australia ($38.1 million) and Norway ($24.8 million). Turkey ($493.9 million) Turkey’s two largest climate donors were the European Union ($292.5 million) and Germany ($199.1 million), while the majority of climate commitments to the country were in the form of grants ($297.5 million). The biggest sectors for climate finance include agricultural policy ($271.1 million), power generation ($196.4 million) and environmental policy ($22.7 million). Disaster prevention and preparedness, meanwhile, has a mere $851,000. Kenya ($429.9 million) Electrical transmission ($182.3 million) received the largest share of climate aid to Kenya. Rural development ($53.9 million), environmental policy ($41.6 million), water resources policy ($41.3 million) and basic drinking water supply ($26.1 million) were the other sectors in which climate commitments were directed. Climate aid was roughly equally split between grants ($228.6 million) and loans ($201.3 million), with France ($202.2 million), the European Union ($94.4 million), Japan ($40.2 million), the Netherlands ($35.1 million) and Australia ($13.8 million) as the top donors. Ethiopia ($374.3 million) Much of Ethiopia’s climate aid was for rural development ($66.7 million) and food security programs ($50.8 million). A big share of this came in the form of grants ($347.2 million), while the rest were financed by loans ($26.6 million). Norway ($94.4 million), the European Union ($73.4 million), the United Kingdom ($31.7 million), Germany ($29 million) and France ($27.3 million) were Ethiopia’s five largest climate donors. Check out more news on donor funding trends online, and subscribe to the Development Insider to receive the latest news, trends and policies that influence your organization.