UN Climate Chief: Finance Must Break Developing Countries from Debt Loop

UN Climate Change Executive Secretary

Simon Stiell, UN Climate Change executive secretary, spoke at COP31 climate finance dialogue in Antalya, Turkey.

“meeting a financial target does not always meet countries’ needs. to do that, we need to look at how finance is delivered”

Current Climate Finance Targets

Countries agreed at COP29 to provide $300 billion yearly by 2035 as part of $1.3 trillion annual climate finance goal.

Debt and Disaster Cycle

Many developing countries face a downward loop of debt, disaster, and capital costs due to climate threats.

“many developing countries are trapped in a downward loop of debt, disaster, and devastating capital costs”

Finance Terms Matter

Stiell stressed that climate finance terms must reflect each country’s debt position to avoid choosing between repayments and resilience.

“the terms of finance should reflect each country’s debt position”

Loan Dominance in Climate Finance

International climate finance for developing countries reached $137 billion in 2024, with 70% as loans.

“international climate finance for developing countries reached about $137 billion in 2024, and almost 70 per cent of it came in the form of loans”

Sub-Saharan Africa Debt Strain

Sub-Saharan African countries paid more than twice as much in external debt service as they received in climate finance between 2021-2023.

“countries in sub saharan africa paid more than twice as much in external debt service between 2021 and 2023 as they received in climate finance”

African Group of Negotiators

The African Group of Negotiators lost a bid for a separate agenda item on tripling adaptation finance at COP31.

“the group lost a bid on monday for a separate agenda item on tripling adaptation finance”

Nigeria’s Climate Finance Needs

Nigeria needs $337 billion between 2026-2035 to implement climate commitments, with 80% from private investment.

“it needs about $337 billion between 2026 and 2035 to implement its climate commitments”

Nigeria’s Climate Action Funding

Nigeria received $2.5 billion annually for climate action in 2021-2022 from domestic and international sources.

“about $2.5 billion a year went to climate action in nigeria in 2021 and 2022, counting domestic and international sources”

Climate Finance Roadmap

The COP31 dialogue will see its conclusions go to COP32 in Ethiopia next year for implementation.

“the dialogue was the last in a series that began in 2013, and its conclusions will go to cop32 in ethiopia next year”

Heinrich Böll Foundation Analysis

Heinrich Böll Foundation analysis found interest payments consumed over 10% of government revenue in 27 African countries in 2024.

“the analysis found that interest payments consumed more than 10 per cent of government revenue in 27 african countries in 2024”

Nigeria Not Least Developed

Nigeria is not on UN’s list of least developed countries, so it relies more on loans and private capital.

“nigeria is not on the un’s list of least developed countries, which places it among the states the un climate chief expects to rely more on loans, guarantees and private capital”

Climate Finance Challenges

Developing countries face a cycle where debt and climate disasters push up borrowing costs before disasters strike.

“the threat of floods, fires, storms and droughts hangs over them, pushing up the price of borrowing even before disaster strikes”