Adaptation cash for poor nations has flatlined, UN report warns

The money has stopped moving. Adaptation finance — the cash that pays for sea walls, early warning systems, flood defences and drought-proof irrigation in poorer countries — has been flat or falling since 2022, according to a new UN Environment Programme report. Flows from rich to poor nations reached at most $32bn in 2024, the latest year with data. That is up just $1bn on the year before, and down from the 2022 peak.

The need runs on a different scale. The world's 155 developing nations will require $305bn a year by 2035 to handle heatwaves, fires, floods, storms, droughts and rising seas, UNEP estimates. Rich countries promised in 2021 to reach $40bn a year by 2025, and the report says that pace is already blown — though multinational development banks are expected to have covered part of the shortfall. One reason for the squeeze: European governments are funnelling more of their budgets into defence.

At COP30 in Belém, Brazil, wealthy nations agreed to triple adaptation finance by 2035, pushing it to between $85bn and $120bn. Even that would cover only 20-29% of what is needed, the report says. The countries least responsible for the crisis are carrying the heaviest load: least developed countries and small island states need $40bn to $50bn a year, about 3-4% of their GDP and double the relative burden on upper-middle-income developing nations.

Instead, support is shrinking. Least developed countries received 16% less adaptation funding in 2024 than two years earlier. Between 2020 and 2025, low- and middle-income countries were home to 99% of the 765 million people hit by floods and landslides. A newly established loss and damage fund is already swamped — 119 developing countries filed requests totalling $2.8bn in its first round, against initial funding of $342m.

The financing mechanics make it worse. Debt and equity costs can more than double the budget of an adaptation project, the report notes. Climate justice groups want grants or concessionary loans rather than high-interest debt, arguing that sea walls and heat shelters do not generate revenue to pay lenders back.

UNEP executive director Inger Andersen said a global temperature overshoot of 1.5C above preindustrial levels is now locked in, making climate impacts more intense, frequent and unpredictable. 'For the countries that contributed the least yet suffer the most, this is an unavoidable reality,' she said, calling adaptation finance a vital investment in global resilience. The fight moves next to COP31 in Antalya, Turkey, running 9 to 20 November, where climate groups say adaptation finance is the most urgent item on the table.