TBILISI — The Asian Development Bank (ADB) needs to ramp up its climate financing to at least $11.5 billion annually as vulnerable economies continue to take the hit of the impact of worsening climate change.
On the sidelines of the 57th ADB Annual Meeting here, non-government organization Oxfam International released a report urging the ADB to jack up its annual climate finance from an average of $6.2 billion to $11.5 billion.
It also called on the ADB to increase its adaptation finance from $2.1 billion to $3.9 billion until 2023 in order to meet its own goals.
Oxfam had analyzed ADB’s climate finance portfolio for the last five years and found that the bank may have overstated its project amount financing by 44 percent.
This covered 15 climate adaptation projects, two of which are from the Philippines.
These are the Climate Change Action Program with a potential over-reporting of 30 percent and the Build Universal Health Care Program with a 49 percent possible over-reporting.
Overall, the 15 projects covered showed that actual adaptation finance could be off by 44 percent or just $900 million instead of the reported $1.7 billion.
Other countries included were Pakistan, Bangladesh, India, Indonesia, Papua New Guinea, Cambodia and China.
ADB is Asia’s single largest multilateral provider of climate finance, accounting for 50 percent of the international climate finance in the region.
The bank has promised to deliver $100 billion in climate finance to low- and middle-income countries by 2030, of which $34 billion is earmarked for climate adaptation and resilience.
However, Oxfam said funding patterns for the last five years revealed only 34 percent of the commitment went to adaptation, less than the internationally agreed 50:50 balance of adaptation and mitigation funding.
“This scenario is not unique to the ADB. It illustrates a wider trend observed in global climate finance, where adaptation has traditionally received a smaller share of public climate finance globally,” Oxfam said.
“This underscores an urgent need for a strategic shift towards more balanced and adequate funding for adaptation,” it said.
As such, the global organization is calling for a transformative shift in the ADB’s adaptation finance strategies.
Oxfam maintained that the ADB must improve the accuracy and transparency of climate finance reporting and realign financial flows with the needs of the region’s most vulnerable communities.
This is especially true as the region has been warming faster than the global average.
Further, the study showed that the majority of climate adaptation funding by ADB or about 93 percent of the $10.5 billion in the last five years was allocated as loans and only six percent as grants.
“Loans provided at market rates should not be counted as climate adaptation finance.
These loans are a climate debt trap for countries in Asia. They are forced to pay for climate damages that they did so little to cause,” Oxfam said.