In a world where climate change increasingly threatens the very existence of vulnerable populations, the international community stands at a critical juncture. Recent reports reveal a disturbing trend: wealthy nations are not just failing to fulfill their climate finance commitments but are actively deepening the economic burden on the Global South. This is more than a funding issue; it is a blatant continuation of historical injustices that prioritize profit over people and perpetuate systemic inequities.
A recent study by Oxfam and CARE Climate Justice Center, titled the “Climate Finance Shadow Report 2025,” lays bare the chasm between the pledges made by developed nations and the reality faced by developing countries. As we gear up for the 30th United Nations Climate Change Conference (COP30), scheduled for November 10–21 in Belém, Brazil, the implications of this report are alarming. The upcoming conference, ostensibly a venue for global cooperation and sustainable development, risks becoming yet another platform for hollow promises if the realities highlighted in the report are ignored.
The report underscores a grim truth: developing countries are paying exorbitantly for climate finance, often spending seven dollars for every five they receive. This disparity is exacerbated by the severe cuts in foreign aid, described as the most vicious since the 1960s. With an estimated 9 percent drop in climate funding in 2024 and projections for further declines in 2025, it is clear that the burden of the climate crisis is being disproportionately shouldered by those who have contributed the least to its onset.
John Norbo, Senior Climate Advisor at CARE Denmark, encapsulated the urgency of the situation when he stated, “Rich countries are failing on climate finance and they have nothing like a plan to live up to their commitments.” The stark reality is that while affluent nations enjoy the economic benefits of climate-related activities, the poorest countries are left to deal with the catastrophic consequences, often at the expense of their very lives.
Despite pledging approximately USD 116 billion for climate funding, developed nations have delivered less than one-third of that amount—an estimated USD 28–35 billion. Even more troubling is the fact that nearly 70 percent of this funding has been disbursed in the form of loans, strapping these nations with debt while simultaneously failing to address their urgent climate adaptation needs. This is a classic case of crisis profiteering, where wealthy nations exploit the vulnerabilities of developing countries rather than offering genuine assistance.
The staggering USD 3.3 trillion indebtedness of developing nations is a direct result of this exploitative financial framework. In 2022 alone, these countries were saddled with about USD 62 billion in climate loans, generating a staggering USD 88 billion profit for wealthy creditors. France, Japan, Italy, Spain, and Germany are among the top offenders, lending to nations they have historically harmed. This dynamic not only exacerbates debt but also perpetuates a cycle of dependency and vulnerability.
Oxfam’s Climate Policy Lead, Nafkote Dabi, aptly stated, “Rich countries are treating the climate crisis as a business opportunity, not a moral obligation.” This mindset reveals a troubling moral bankruptcy among wealthy nations, who continue to prioritize their economic interests over the survival of communities already grappling with the effects of climate change. The report highlights that Least Developed Countries (LDCs) received a meager 19.5 percent of public climate funding over 2021-2022, while Small Island Developing States (SIDs) received a paltry 2.9 percent. Alarmingly, only 33 percent of these funds were allocated for climate adaptation, a critical area that has been historically underfunded.
The ramifications of this skewed allocation are catastrophic. Communities in the Horn of Africa faced devastating cycles of drought and flooding, displacing millions and plunging tens of millions into food insecurity. Brazil was not spared either, as massive floods in Rio Grande do Sul resulted in over 180 civilian deaths and the displacement of 600,000 people. Children in Bangladesh, particularly vulnerable to climate impacts, faced significant disruptions to their education due to extreme weather events. The United Nations Environment Programme (UNEP) warns that we are on track for a “catastrophic” 3°C rise in global temperatures by the century’s end, escalating the frequency and intensity of natural disasters that disproportionately affect those least equipped to handle them.
As we approach COP30, Oxfam has made clear demands for wealthy nations to honor their climate finance commitments, including the full USD 600 billion pledged for 2020–2025. This call for accountability is not merely an appeal; it is a necessity for justice. Oxfam also advocates for a significant increase in global funding for climate adaptation and loss management and the urgent need for wealthy countries to pivot from loans to grants and highly concessional financing.
The moral imperative is clear: we must dismantle this debt trap and hold affluent nations accountable for their historical and ongoing roles in perpetuating climate injustice. The time for empty promises is over; it is time for action. If we are to seek true global equity and justice, we must demand a fundamental shift in how climate finance is structured—one that prioritizes human rights, supports those most affected, and rejects the sinister logic of profit over people. The lives of millions hang in the balance.
This article highlights the importance of OF CLIMATE FINANCE.
