With negotiators on global climate action gathered in Belém in the heart of the Brazilian Amazon this past month, COP30 was branded the ‘COP of implementation’, with a special focus on adaptation, forest protection, and loss and damage. Yet with the summit now over, the gap between ambition and delivery remains stark, with finance talks failing to translate the new collective quantified goal (NCQG) and the fund for responding to loss and damage (FRLD) into predictable, grant-based support.

The ‘Baku to Belém’ finance story

At COP29 in Baku in 2024, countries pledged to triple climate finance to $300 billion annually by 2035 and outlined a broader $1.3 trillion ‘Baku finance goal’, which is now linked to a Baku-to-Belém roadmap. Yet scepticism persists because the structural inequalities in global finance that block real access and fairness remain unchanged.

Inequality is baked into the climate finance system through wrong finance

Climate finance has gone wrong in three dimensions: size, type and allocation.

Wrong size

According to the OECD, climate finance provided and mobilised by developed countries reached $89.6 billion in 2021, falling short of the annual goal of $100 billion (OECD, 2023). In 2022, developed countries provided $32.4 billion in adaptation finance, representing only 28% of total climate finance; mitigation continued to receive 60% of funds (OECD, 2024).

Wrong type

In a developing world already squeezed by a public debt crisis, climate finance is too often making matters worse, because most of it comes as loans rather than grants. Flows of foreign direct investment into developing economies dropped to just $841 billion in 2023, a 9% fall (United Nations Trade and Development, UNCTAD, 2024).

Meanwhile, developing countries paid $921 billion in interest on public debt in 2024 (a 10% increase over 2023) and 3.4 billion people live in countries that spend more on debt interest than on either health or education (UNCTAD, 2025). At the same time, in low-income countries, domestic public debt servicing costs have surged: the median domestic debt service as a percentage of government revenues rose from 3% in 2014 to about 19% in 2024 (International Monetary Fund, IMF, 2025).

Amid all this, over 70% of what has been provided as climate finance comes as loans rather than grants (United Nations Development Programme, UNDP, 2021; OECD, 2021). The result is that climate-vulnerable economies are forced to choose between servicing debt or investing in adaptation and mitigation, a dilemma that no country should have to face.

Wrong allocation

The divide reflects how the climate finance agenda is prioritised: leveraging their technological advantage and legacy as top emitters, developed countries tend to emphasise mitigation efforts aiming to reduce global emissions of greenhouse gases (Centeno, 2025). The largest chunk of the already insufficient finance has gone to mitigation projects rather than adaptation, sidelining the urgent priorities of countries facing rising seas and falling rains (Tollefson, 2021; Bhandary, 2022).

The global system is rigged, with poor countries expected to borrow to fund climate action, even as the emissions from which they suffer are generated elsewhere.

The multilateral breakdown: from threat to reality

The multilateral system underpinning climate cooperation is fracturing. Geopolitical tensions – from wars in the Middle East and Ukraine, to debt crises in Ghana and Sri Lanka – are diverting resources and weakening green investment readiness, while US-China decoupling further erodes cooperation (IMF, 2025). The United States, under President Trump, has formally withdrawn from the Paris Agreement and stepped back from global mechanisms like the FRLD.

In Belém, negotiations on climate finance reporting reveal deep mistrust as wealthy countries increasingly bypass multilateral channels, accelerating the ‘bilateralisation’ of climate finance (OECD, 2023; Transparency International, 2023). This weakens the Paris Agreement financial tracking mechanisms and fund predictability.

The first global stock-take exposed severe misalignment with 1.5°C and failures in finance delivery (United Nations Framework Convention on Climate Change, UNFCCC, 2023), risking a process that merely documents inequality (Mbeva and Pauw, 2022).

Another dimension in the failure among multilaterals is that integrating climate considerations into global debt frameworks remains far below expectations. Recent initiatives – including the UN Expert Group 11 Measures on Debt and the Jubilee Commission Blueprint – emphasise that IMF-World Bank assessments and the G20 Common Framework still fall short of acknowledging climate vulnerability and disaster shocks.

Without climate-aligned debt relief, countries face impossible choices between repayment and resilience. Zambia’s prolonged restructuring illustrates how current systems trap climate-exposed nations.

The tropical forests finance framework: ambitious but in need of systemic rebalancing

COP30 should be congratulated on having launched the tropical forests finance framework (TFFF), a needed recognition of the Amazon’s global significance. The launch declaration has already been endorsed by 53 countries.

But the success of the TFFF will depend entirely on whether it is paired with deeper transformations in the global financial system. Over the medium term, the TFFF aims to build a $125 billion facility – combining $25 billion of sovereign capital with $100 billion of investor debt, a 1:4 public-to-private ratio that reinforces how heavily the architecture leans on private capital.

Article 9.1 is unequivocal: provide or mobilise?

Article 9.1 of the Paris Agreement imposes a clear legal duty on developed countries to provide predictable public concessional finance for mitigation and adaptation. Yet practice has shifted towards Article 9.3, which urges countries to mobilise finance, widely interpreted as leveraging private capital.

This shift allows governments to claim credit for catalysing private flows while reducing direct public contributions, weakening the support that vulnerable countries need for adaptation and resilience. The trend is deepening as new mechanisms, including the TFFF, emphasise private investment while leaving their public finance pillars unclear.

Fixing the architecture: not just more money but systemic reform

What’s needed now is not just a new pledge or a new initiative, but a paradigm shift in the delivery of COP outcomes. Key actions should include:

• Embedding predictable, grant-based public finance across all core climate finance mechanisms, including the NCQG, the FRLD and national adaptation plans. These should set binding public finance floors and multi-year replenishment cycles to ensure reliability, equity and accessibility for climate-vulnerable countries.
• Rebalancing TFFF financing towards public grants by setting a minimum public finance floor (for example, 40-50%) and capping reliance on leveraged private capital. This will ensure that forest protection is not dependent on volatile market flows and that indigenous and frontline communities receive predictable, grant-based support.
• Adopting climate-adjusted lending and debt relief mechanisms to reduce the cost of capital and prevent vulnerable countries from choosing between repayment and resilience. This should involve transforming IMF crisis response trust funds into a climate-resilient liquidity facility, allocating support based on climate vulnerability rather than GDP.
• Requiring all climate finance initiatives to adopt a unified transparency and reporting framework, with proper definitions and annual disclosure of public versus private contributions, grant versus loan composition, disbursement timelines and community-level impacts. This should all to be integrated into UNFCCC systems to ensure consistency, accountability and independent verification across the entire architecture of climate finance.

The bottom line

As COP30 wrapped up last week, the pattern was already visible. Implementation initiatives have multiplied: from the TFFF launch and new roadmaps for forest finance to announcements by multilateral banks on adaptation and the first operational call of the FRLD.

But the core problem remains untouched: the public finance gap. Without binding commitments that embed predictable finance into the NCQG, the FRLD and national adaptation plans, and without addressing the debt burdens that are eroding climate resilience, there is a risk that the COP of implementation served to reinforce structural inequities.

Climate finance is not charity: it is payback. With trust eroding, bilateralism rising and enforcement weakening, multilateralism itself is at stake.

Acknowledgment

The author would like to acknowledge the efforts of Habiba Amr in the development of this piece.