Collision course: Australia’s flatlining aid and its climate finance commitments

Australian Minister for Foreign Affairs Penny Wong on a tour of climate change impacts in the Marshall Islands, October 2022
Australian Minister for Foreign Affairs Penny Wong on a tour of climate change impacts in the Marshall Islands, October 2022 (Nathan Fulton/DFAT)

Recent data shows that official development assistance (ODA, “aid”) is increasingly being spent as a form of climate finance. The OECD reported that climate finance increased from 21.7% of bilateral ODA in 2013 to 27.6% in 2021. Through the United Nations Framework Convention on Climate Change (UNFCCC) and its 2015 Paris Agreement, the nations of the world have committed to reducing climate change and its negative impacts.

Climate finance flowing from developed to developing countries is an important part of these international agreements. In late December 2022, Australia forwarded its Fifth Biennial Report to the UNFCCC, detailing its actions on climate change, and the Article 9, paragraph 5 report which is largely a rearrangement of the climate finance information in the Biennial Report. These reports are the main mechanism through which countries detail how they are implementing and reporting their climate finance commitments. This blog discusses some of the key issues that emerge from Australia’s most recent reports. 

Like the rest of the world, the worsening climate crisis has meant that climate finance has become a much more prominent part of Australia’s overall development engagement, particularly in the Pacific. However, with Australia’s aid falling and then flatlining in real terms over the next 14 years, its current and future climate finance commitments will increasingly be accompanied by difficult trade-offs with our other development objectives and those of our partners.

Fiona Ryan

Fiona Ryan is a researcher and policy advisor based in Cairns. She was an accredited observer to five UNFCCC conferences between 2020 and 2022.

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