The World Bank’s climate financing efforts are facing serious questions after a new report from Oxfam revealed that a staggering $41 billion in climate finance – nearly 40% of their total over the last seven years – cannot be accounted for. This revelation has sparked concerns about the institution’s transparency and its ability to effectively combat climate change.
The report, published Wednesday, details an audit of the World Bank’s climate finance portfolio from 2017 to 2023. The audit found a significant discrepancy between the Bank’s stated commitment to climate finance and the actual amount spent. The missing $41 billion represents a substantial portion of funds that were approved for climate projects but were never properly documented or tracked after project initiation.
“The Bank is quick to brag about its climate finance billions — but these numbers are based on what it plans to spend, not on what it actually spends once a project gets rolling,” stated Kate Donald, head of Oxfam’s Washington office.
The Oxfam audit discovered a lack of clear public records regarding the use of these funds, making it impossible to assess their impact on climate action. Without proper documentation, it becomes difficult to determine whether the funds were actually used for climate-related initiatives as promised.
“With this level of information, it is impossible to determine whether the Bank is truly stepping up its climate investments,” the report’s authors emphasized.
The World Bank, under its new president Ajay Banga, has aimed to strengthen its climate financing commitment. Since taking office last year, Banga has pledged to reform the 80-year-old institution and increase the proportion of annual financing allocated to climate change adaptation from 35% to 45% starting in the fiscal year 2025, which began in July. However, the Oxfam report’s findings cast a shadow on these ambitious plans, raising questions about the Bank’s ability to deliver on its climate finance promises.
The report’s findings come at a critical time, as the world grapples with the increasing impacts of climate change. The World Bank’s role in providing climate finance to developing countries is crucial, and the lack of transparency and accountability surrounding these funds raises concerns about the effectiveness of its efforts to combat climate change. The findings highlight the urgent need for greater transparency and accountability in climate finance, ensuring that funds are utilized efficiently and effectively to address the climate crisis.