Street in Maafushi island, Maldives, flooded with rain water.
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In 2009, developed countries jointly agreed to raise US$100 billion per year in climate finance by 2020. The total amount of adaptation finance has increased each year since then, but the extent to which allocations are in line with recipients’ climate vulnerability is still debated in the literature.

This paper analyses the determinants of adaptation finance allocation using data sourced from the Organisation for Economic Co-operation and Development.

It finds that, on average, the countries that are the most vulnerable to climate change receive smaller allocations of adaptation finance from bilateral donors than their less vulnerable counterparts. Multilateral donors are found to allocate more adaptation finance to small island developing states, but they are not observed to prioritise vulnerable nations in the selection stage.

Overall, this paper finds that the allocation of adaptation finance is not consistently aligned with the sentiment of the Paris Agreement, which stipulates that efforts should be made to provide financial resources to assist developing countries, with priority given to countries that are particularly vulnerable to the adverse effects of climate change.