03. 11. 2025
AUTHOR: Norbert Gorißen
This text was originally published by Backchannel.
When countries met in Azerbaijan last year, they pledged to scale up climate finance to $300bn a year for developing countries by 2035.
It was a cautious and measured commitment, agreed in the shadow of economic uncertainty in a post-COVID world still stabilising, budgets strained by support for Ukraine following Russia’s invasion, and global inflationary pressures rippling through Europe and the global economy.
Now with a hardened global economic situation, the question is not whether the promise was ambitious enough (it may not be, given latest findings on insufficient adaptation finance) but whether it will be delivered and who will lead that effort.
Europe has both the means and the moment to do so. Having once driven global consensus through the Paris Agreement, it can and should again take the mantle of leadership in driving tangible progress on climate finance.
EU: needed
The global context could hardly be more challenging. Multilateralism is fraying, trust between North and South is brittle, and pessimism about global cooperation is deepening. Yet within this fragility lies opportunity.
If Europe steps forward to lead not only with an ambitious 2035 NDC but as well on climate finance, it can reassert its position as a credible force in global diplomacy and a driver of sustainable economic growth.
Policy must be guided by long-term purpose, not short-term politics. Climate finance decisions made today will shape whether we facilitate the prospects for a more stable, secure, and equitable global economy over the next decade.
Budget pressures across Europe are undeniable. This year’s sharp reductions in Official Development Assistance have already affected climate finance flows. But there is also progress, and reason for confidence.
Cash: flowing
Major donors remain engaged, with developed countries having met – and exceeded – the $100bn target in 2022 and likely again in 2023. In 2024, Europe continued to be the by far largest provider of climate finance, contributing €31.7 billion from public sources and mobilising an additional €11 billion in private finance to support developing countries.
Germany achieved its public climate finance goal of 6bn $ for 2025 already last year, and alongside the United Kingdom, has committed to being among the countries leading the delivery of the new $300bn target.
Multilateral development banks (MDBs) are expanding their balance sheets, and new financing platforms for country wide programs are emerging. From large-scale programmes to community-driven initiatives, the financing ecosystem is becoming more dynamic. Rightly so, impact is more in the focus, than just quantity.
New resource-generating mechanisms such as solidarity levies are discussed; small surcharges on luxury travel, for example, can raise substantial funds without burdening taxpayers or public budgets. These ideas enjoy strong public support, even amid setbacks such as the recent one-year delay in adopting a shipping levy at the International Maritime Organization.
Reform: urgent
Momentum is building elsewhere too. When countries gathered in Seville for the Financing for Development Conference, they called for reforming global financial governance and debt architecture, scaling up MDB lending, expanding ODA and climate finance, and strengthening domestic and private investment.
These are precisely the structural shifts needed to unlock the trillions required for developing economies to adapt to and mitigate climate change. The Brazilian COP presidency is expected to fold these priorities into the forthcoming ‘Baku to Belem’ roadmap.
But the immediate task is clear. As Brazil steers the process, the next COP must provide assurance that last year’s commitments will be honoured and finance will be delivered. The $300bn goal by 2035 is within reach with existing mechanisms and modest additional ambition. But developing countries are seeking visibility on how the $300bn target will be achieved, a legitimate demand.
A plan?
To demonstrate leadership, EU and its member states should arrive at COP with concrete pledges and delivery plans with a special attention to adaptation finance for the most vulnerable countries. Climate finance must be treated not as a budgetary burden but as a strategic investment, one that underpins economic stability, energy security, and Europe’s geopolitical relevance.
The EU should use its Global Gateway more strategically to align development and climate finance, improve coordination between the EU budget and member states, and push for faster reform of international financial institutions. The recent “vision for climate and energy diplomacy” adopted in October provides a strong foundation.
MDBs are already on track to deliver around $120bn annually by 2030. To unlock their full potential, shareholders, particularly the EU and its member states, must take a more active role in boosting leverage and risk-sharing capacity.
High costs of capital for green energy investments are a major obstacle for many developing countries. Therefore priority should be to crowd in private finance at scale with intelligent finance instruments while maintaining concessional flows for the most vulnerable economies. At the same time, it is essential to recognise that development banks (national, bilateral, and multilateral) must become more willing to take on greater risk in climate projects than what the private sector can undertake on its own.
COP30 must mark a decisive shift from pledges to performance, backed by credible accountability mechanisms. Transparency and accountability are core EU principles, and these should be built into the architecture of the new climate finance goal. Ultimately, the real impacts of climate finance on mitigation and adaptation matter more than accounting measures alone.
EU‘s Strategic Interests: Trust and Alliances
Rebuilding trust will, in particular, depend on adaptation, the top priority for many developing economies. Developed countries should show how they are delivering on their Glasgow pledge to double adaptation finance and announce new commitments linked to specific outcomes.
This is not only a diplomatic exercise. Climate finance aligns with Europe’s strategic interests. It strengthens energy and economic resilience, fosters long-term growth in partner economies, deepens alliances with emerging markets, and opens access to untapped clean energy supply chains.
These are precisely the levers Europe must engage to remain competitive, secure, and relevant in the coming decades.
Delivering on the $300bn goal will test political will as much as financial ingenuity. But it is a test Europe cannot afford to fail. If it leads with credibility and clarity, Europe can turn what was once a cautious promise into a defining investment in the world’s and its own future.
