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

This report by the Climate Policy Initiative and the Global Center on Adaptation analyzes international public climate adaptation finance for Small Island Developing States (SIDS) between 2021 and 2022. It identifies a significant funding gap, noting that current annual flows of approximately $2 billion are far below the estimated annual need of $11.7 billion. The report highlights that a large portion of this finance is provided as debt, posing macroeconomic risks, and calls for a shift from GNI-based ODA eligibility to a multidimensional vulnerability index to improve financial access.

• International public adaptation finance for the 39 SIDS nations averaged just over $2 billion annually in 2021–2022, representing only 0.2% of all global climate finance.
• SIDS are estimated to require at least $11.7 billion in average annual finance flows for adaptation between 2023 and 2035, which is approximately six times the tracked flows from 2021–2022.
• Debt accounted for 44% of tracked international adaptation finance to SIDS in 2021–2022, with 65% of finance from multilateral development finance institutions (DFIs) provided as debt.
• Multilateral DFIs were the primary source of international public adaptation finance for SIDS, providing 60% of tracked finance in 2021–2022, followed by international governments at 31%.
• There is a stark disparity in finance based on ODA eligibility: ODA-eligible SIDS received $1.9 billion in annual international public adaptation finance in 2021–2022, while ODA-ineligible SIDS received only $181 million.
• Adaptation finance is highly concentrated, with 67% of tracked finance flowing to only 10 SIDS, and shows no significant correlation to climate vulnerability as measured by ND-GAIN scores.
• Regional analysis shows the Caribbean received the highest aggregate finance ($987 million on average in 2021–2022), but the Pacific received the highest per capita finance at $59 per person.
• Among the 16 SIDS that provided sectoral breakdowns of their needs, water and sanitation was the largest need (26%), followed by food, agriculture, and forestry (19%) and infrastructure (18%).
• SIDS are advocating for the replacement of GNI-based ODA eligibility criteria with a multidimensional vulnerability index (MVI) to better capture their vulnerability and increase access to finance.
• Tracking adaptation finance in SIDS is hindered by a lack of domestic budget tagging, inconsistent methodologies for costing needs in NAPs and NDCs, and limited private sector disclosure.

APA

Climate Policy Initiative (n.d.). State and Trends of Climate Adaptation Finance in Small Island Developing States. https://www.climatepolicyinitiative.org/wp-content/uploads/2025/09/State-and-Trends-of-Climate-Adaptation-Finance-in-Small-Island-Developing-States.pdf

Chicago

Climate Policy Initiative. State and Trends of Climate Adaptation Finance in Small Island Developing States. n.d. https://www.climatepolicyinitiative.org/wp-content/uploads/2025/09/State-and-Trends-of-Climate-Adaptation-Finance-in-Small-Island-Developing-States.pdf.

Wikipedia

{{cite report |author=Climate Policy Initiative |title=State and Trends of Climate Adaptation Finance in Small Island Developing States |url=https://www.climatepolicyinitiative.org/wp-content/uploads/2025/09/State-and-Trends-of-Climate-Adaptation-Finance-in-Small-Island-Developing-States.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatepolicyinitiativendstate, author = {{Climate Policy Initiative}}, title = {{State and Trends of Climate Adaptation Finance in Small Island Developing States}}, institution = {Climate Policy Initiative}, url = {https://www.climatepolicyinitiative.org/wp-content/uploads/2025/09/State-and-Trends-of-Climate-Adaptation-Finance-in-Small-Island-Developing-States.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }