Rethinking climate finance to scale global flows to USD 1.3 trillion

Editorial Team SDG13
2 days ago
3 min read

As the world approaches COP30 in Belém, a new financial vision is taking shape. Brazil, together with a coalition of finance ministers, has proposed an ambitious global climate finance goal, mobilising USD 1.3 trillion annually for developing countries by 2035. This target, known as the New Collective Quantified Goal (NCQG), represents the next phase of climate solidarity after years of unmet pledges and partial delivery.

The initiative is framed not as another figure to negotiate, but as a systemic transformation of how capital flows towards climate goals. The Baku to Belém Roadmap to 1.3 T, developed through Brazil’s new “Circle of Finance Ministers”, outlines five pillars for scaling up: concessional finance, reform of multilateral development banks (MDBs), stronger domestic institutions, mobilisation of private capital, and robust regulatory frameworks.

At stake is not only the planet’s future, but also the fairness of who pays for it.

The scale of need and the gap to fill

Current global investment requirements for climate action in developing economies are estimated at USD 2.4 trillion annually by 2030, rising to USD 3.3 trillion by 2035. Yet only a fraction of today’s USD 1.9 trillion in global climate finance reaches these countries. Much of it remains trapped in high-income economies, with adaptation, critical for climate-vulnerable nations, chronically underfunded.

The proposed USD 1.3 trillion target would cover the external portion of developing countries’ needs, with at least USD 300 billion expected from public sources. The remainder would have to come from a complex mix of private, domestic and blended finance.

Debt, equity and the politics of climate money

Behind the numbers lies a moral and financial quandary. Many developing countries are already heavily indebted and face shrinking fiscal space. Without concessional terms or grant-based mechanisms, the new climate flows could deepen rather than ease financial strain.

The roadmap acknowledges this by calling for non-debt-creating instruments, but its language remains cautious. Meanwhile, finance ministers from Africa, Latin America and the Pacific warn that without genuine reform, the climate transition could reproduce existing economic hierarchies, where capital remains expensive for the South and risk perceptions stay skewed.

In this context, the debate over climate finance is also a debate over justice. If wealthier nations mobilise mostly loans or risk-bearing private instruments, the cost of resilience will once again fall on those least responsible for the crisis.

Barriers in the financial architecture

The path to USD 1.3 trillion runs through a landscape of structural obstacles.

· Access barriers persist, with developing countries facing slow, bureaucratic procedures to draw from existing climate funds.

· MDB reform has yet to deliver new tools, capital headroom or risk-tolerant lending models.

· Private finance, though essential for scale, continues to flow primarily toward low-risk, high-return projects, rarely those most urgent for adaptation or resilience.

· Domestic readiness remains uneven, with many nations lacking the policy frameworks or creditworthy project pipelines to absorb investment efficiently.

Unless these underlying issues are addressed, the roadmap may struggle to move beyond the rhetoric of scaling finance towards practical delivery.

From ambition to accountability

The political tension surrounding the roadmap reflects the deep asymmetries of the global economy. Small island states and least-developed countries have expressed concern that while the plan is ambitious, it lacks enforcement mechanisms and concrete timelines. They are calling for a more transparent structure for monitoring contributions, better terms for access and a higher share of funds for adaptation and loss & damage.

Brazil’s leadership at COP30 will therefore be tested on its ability to forge consensus between the Global North’s financial institutions and the Global South’s development needs.

The wider developmental stakes

This initiative touches several sustainable development priorities, notably SDG 13 (Climate Action) and SDG 17 (Partnerships), by demanding cross-border cooperation and institutional reform. But it also intersects with poverty reduction, job creation and sustainable infrastructure, raising the question of whether climate finance can be both transformative and fair.

If the Baku to Belém roadmap succeeds, it could redefine how the world values public goods and how financial systems measure risk. If it fails, it may reinforce the very inequalities the climate crisis has laid bare.