State and Trends of Climate Adaptation Finance in Small Island Developing States

The report finds that international adaptation finance for SIDS is severely insufficient, averaging just over USD 2 billion annually in 2021–2022, while assessed needs are approximately USD 12 billion. It highlights that 44% of this finance was provided as debt, posing macroeconomic risks, and notes a high concentration of funds, with 10 SIDS receiving 67% of tracked finance. The document calls for a six-fold increase in flows, a shift from ODA eligibility to a multidimensional vulnerability index, and improved tracking of both public and private investments.

• International adaptation finance flows to Small Island Developing States (SIDS) are critically low, representing only 0.2% of global climate finance. In 2021–2022, the 39 SIDS nations received an annual average of just over USD 2 billion in international public climate finance for adaptation.
• To meet assessed needs based on National Adaptation Plans (NAPs) and Nationally Determined Contributions (NDCs), adaptation finance flows to SIDS must increase six-fold to approximately USD 12 billion annually. This amount represents 1.2% of all global climate finance and 4% of all global Official Development Assistance (ODA).
• A significant portion of adaptation finance to SIDS is provided as debt, which accounted for 44% of flows in 2021–2022, creating risks for macroeconomic stability in countries with unsustainable debt levels.
• Adaptation finance is highly concentrated and poorly aligned with vulnerability; 10 SIDS receive 67% of tracked finance, and there is no significant correlation between finance flows and Notre Dame Global Adaptation Initiative (ND-GAIN) vulnerability scores.
• There is a stark disparity in funding between ODA-eligible and ODA-ineligible SIDS, with the former receiving USD 1.9 billion annually and the latter receiving USD 181 million in 2021–2022, leading to calls to replace ODA criteria with a multidimensional vulnerability index.

APA

Climate Policy Initiative (2025). State and Trends of Climate Adaptation Finance in Small Island Developing States. https://www.climatepolicyinitiative.org/publication/state-and-trends-of-climate-adaptation-finance-in-small-island-developing-states/

Chicago

Climate Policy Initiative. State and Trends of Climate Adaptation Finance in Small Island Developing States. 2025. https://www.climatepolicyinitiative.org/publication/state-and-trends-of-climate-adaptation-finance-in-small-island-developing-states/.

Wikipedia

{{cite report |author=Climate Policy Initiative |title=State and Trends of Climate Adaptation Finance in Small Island Developing States |date=1 October 2025 |url=https://www.climatepolicyinitiative.org/publication/state-and-trends-of-climate-adaptation-finance-in-small-island-developing-states/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatepolicyinitiative2025state, author = {{Climate Policy Initiative}}, title = {{State and Trends of Climate Adaptation Finance in Small Island Developing States}}, institution = {Climate Policy Initiative}, year = {2025}, month = oct, url = {https://www.climatepolicyinitiative.org/publication/state-and-trends-of-climate-adaptation-finance-in-small-island-developing-states/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }