Global Landscape of Climate Finance 2025 1

The Global Landscape of Climate Finance offers the most comprehensive overview of global climate finance flows, providing crucial insights into the resources dedicated to addressing climate change. Download the latest report or explore the data in the GLCF Data Dashboard.

Overview: Climate finance in 2023

Global climate finance hit an all-time high of USD 1.9 trillion in 2023. Early data indicates that climate finance exceeded USD 2 trillion for the first time in 2024.1

Climate finance has picked up pace, particularly between 2021 and 2023.

On average, annual investments increased by 26% between 2021 and 2023.

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In comparison, the compound annual growth rate between 2018 and 2020 was 8%.

At the current rate, meeting USD 6 trillion—the most conservative estimate of required annual climate investment—may be reachable by 2028.   

Further climate investment would not only reduce greenhouse gas emissions, but also create a wide range of benefits from economic growth to improved health. Inaction, on the other hand, will be more costly to the global economy in the long term, resulting in economic losses amounting to 15% of global GDP by 2050 from 2°C of warming and 30% by 2100 from 3°C. ​ 

Who is investing?

For the first time, private climate finance contributions exceeded USD 1 trillion in 2023, outpacing public investment. 

 

Households were a major driver, investing in energy efficiency, water heaters, and renewable-energy-powered HVAC systems, particularly in Western Europe. 

Commercial financial institutions and corporates also showed promising increases in Latin America and the Caribbean, the Middle East, North America, and Central Asia and Eastern Europe.

Public climate finance fell by around 8% between 2022 and 2023, amid constrained domestic government budgets. 

Recently announced cuts to official development assistance raise concern that international public flows may decline further in coming years. 

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That said, 80% of climate finance was raised domestically, underlining the importance of national capital pools. 

This domestic finance was concentrated in East Asia and the Pacific (primarily China), North America, and Western Europe.

A stark disparity persists in emerging economies, where access to affordable capital remains a barrier to private and domestic climate finance. EMDEs need more catalytic capital—such as guarantees, grants, and catalytic equity—to further scale climate flows in all regions. 

 

Where is the money going?

International climate finance to EMDEs reached USD 196 billion in 2023 with 78% from public actors.

Climate-related development finance in EMDEs increased by nearly three times between 2018 and 2023.

Mitigation finance made up the majority of global climate flows, at  USD 1,780 billion in 2023. Adaptation finance reached USD 65 billion, though this is likely an underestimation due to tracking challenges. Dual-benefit finance—pursuing both adaptation and mitigation objectives—reached USD 58 billion.  

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Between 2018 and 2023, climate mitigation finance more than doubled, reflecting a CAGR of around 19%.

This was driven largely by significant private investments in energy systems, alongside growing finance for transport electrification and energy-efficient buildings.

Clean energy investment is becoming a major driver of GDP in certain economies. For example, clean-energy technologies made up more than 10% of China’s economy for the first time in 2024.

Explore the data further in the GLCF data dashboard, or download the report below for the full analysis.

 

NOTE – This article was originally published in climatepolicyinitiative and can be viewed here

 

Tags: #climate, #climatechange, #climatefinance, #envirinment, #getgreengetgrowing, #globallandscape, #globalwarming, #gngagritech, #greenstories, #nature