United Nations Environment Programme (UNEP) has warned that inadequate climate adaptation financing is leaving developing countries struggling to keep pace with accelerating global warming.
With global temperatures projected to exceed the 1.5°C threshold, the agency cautioned that existing funding commitments and climate action remain insufficient to protect vulnerable communities from escalating climate impacts.
According to the 2026 Adaptation Gap Report, international public adaptation finance from developed to developing countries reached between US$28.2 billion and US$31.7 billion in 2024, representing an increase of just US$1 billion over the previous year.
Even if governments fulfil the commitment to triple adaptation finance by 2035, projected annual funding of US$85 billion to US$120 billion would cover only 20 to 29 percent of developing countries’ estimated needs.
UNEP Executive Director Inger Andersen warned that the scale of the financing shortfall leaves countries inadequately prepared for worsening climate conditions.
“The world is not ready to adapt to current climatic conditions, never mind what overshoot of 1.5°C will bring.”
Inger Andersen
Climate Adaptation Finance Falls Behind Growing Needs
Although financial flows increased slightly in 2024, growth remains substantially below the pace required to meet international commitments.
Funding for least developed countries (LDCs) and small island developing states (SIDS) also declined from its 2022 peak, despite recording real-term increases between 2019 and 2024.
The estimated US$305 billion annual requirement is based on an assessment of nationally determined contributions, national adaptation plans and model-based estimates.
UNEP noted that the figure largely excludes the private sector’s own adaptation needs, which could almost double the overall requirement.
The report also highlights differences in the projected financing gap depending on the baseline used to calculate the commitment to triple adaptation finance.
Under the Global Mutirão decision adopted at COP30 in Brazil, countries agreed to pursue efforts to at least triple international adaptation finance by 2035. Depending on the baseline, this would increase annual funding to between US$85 billion and US$120 billion.
However, even at the higher end, the projected financing would remain insufficient to meet developing countries’ needs.
UNEP estimates that tripling support to LDCs and SIDS could cover a larger proportion, between 49 and 83 percent, of their adaptation requirements.
The report also identifies some progress in international financing. Developing countries’ financial contributions through multilateral development banks and direct South-South cooperation increased from US$3.8 billion in 2019 to US$9.6 billion in 2024.
Multilateral development banks are also expected to have increased their adaptation financing significantly in 2025, potentially supporting efforts to achieve the Glasgow Climate Pact commitment to double adaptation finance from 2019 levels to US$40 billion by 2025.
However, UNEP cautioned that achieving this target will partly depend on whether bilateral development partners maintain their contributions amid declining official development assistance.
Climate Adaptation Hampered by Institutional Barriers
UNEP’s report identifies institutional weaknesses as another major obstacle to effective climate adaptation, stressing that increased funding alone will not guarantee progress.
Governments must strengthen institutions responsible for translating adaptation priorities into practical interventions, improve coordination across sectors and levels of government, and establish mechanisms to mobilise and manage climate finance.
The report points to existing efforts, including climate change framework laws, policy-learning platforms and improved institutional coordination, as important measures for strengthening national adaptation systems.
It also highlights mounting losses and damages resulting from insufficient mitigation and adaptation, noting that affected countries continue to face difficulties accessing financial and technical support.
The first funding round of the Fund for Responding to Loss and Damage received requests totalling US$2.8 billion, significantly exceeding its initial funding allocation of US$342 million.
UNEP indicated that the disparity demonstrates substantial unmet demand, although the global financing gap for addressing losses and damages remains undetermined.
Greenpeace Demands Greater Climate Finance Commitments
Responding to the findings, Greenpeace has called on developed countries to substantially increase adaptation financing at COP31, arguing that vulnerable communities continue to bear the consequences of climate change despite contributing relatively little to global emissions.
Koaile Monaheng, Climate Finance Expert at Greenpeace International, stated that the funding shortfall exposed the unequal distribution of climate impacts and the inadequate support available to affected communities.
“The math of climate injustice is here in plain sight, with adaptation needs woefully underfunded. This leaves frontline communities, who have contributed the least to global emissions, facing escalating climate extremes with a fraction of the support. This is morally indefensible.”
Koaile Monaheng
He added, “Adaptation is not a luxury, but critical for human survival, dignity and justice.”
Greenpeace is urging developed countries to announce ambitious multi-year climate finance commitments beyond 2025, reflecting their fair share of the US$300 billion annual climate finance goal agreed at COP29 in Baku.
The organisation is also calling for developed nations to clarify how they intend to deliver at least US$120 billion annually in adaptation finance by 2035, alongside a more comprehensive, needs-based financing commitment.
It maintains that funding should be provided through grants and other non-debt-creating mechanisms rather than loans that risk worsening the debt burdens of vulnerable countries.
Koaile Monaheng warned that “Every delay in adaptation funding turns climate impacts into catastrophic losses and damages.”
“At COP31, governments must confront this reality and the widening adaptation finance deficit by immediately scaling up grant-based funding to meet the goal to at least triple adaptation finance by 2035.”
Koaile Monaheng
The organisation also called for governments to explore progressive environmental taxation, particularly on the profits of oil and gas corporations, to generate additional public resources for adaptation and climate-related recovery.
