Bilateral Finance Institutions and Climate Change: A Mapping of Climate Portfolios

The report finds that Bilateral Finance Institutions (BFIs) play a major role in global climate finance, with four participating institutions (AFD, JICA, KfW, and EIB) collectively disbursing €8.09 billion in 2008. The majority of this funding (85%) is delivered as Official Development Assistance (ODA), with a heavy concentration on mitigation (72%) and the energy sector. Geographically, Asia and Oceania receive the largest share of finance. The document highlights a significant gap in adaptation funding, which is heavily concentrated in the water sector, and calls for better definitions of adaptation finance and increased coordination among BFIs to enhance effectiveness.

• In 2008, the combined climate-related finance from the three bilateral finance institutions (AFD, JICA, and KfW) and the European Investment Bank (EIB) directed to non-Annex I countries totaled €8.09 billion.
• The vast majority of climate finance provided by the participating institutions is delivered through Official Development Assistance (ODA) channels, accounting for approximately 85% of the total.
• Climate finance is heavily skewed toward mitigation, which represents roughly three quarters of the total funding and is primarily focused on stationary energy (47%) and transportation (32%).
• Geographically, Asia and Oceania are the primary recipients of BFI climate finance, receiving 60% of the total spending.
• Adaptation finance is significantly lower than mitigation finance and is overwhelmingly concentrated in the water sector, which accounts for 77% of such funding.
• BFI finance for mitigation is estimated to be at least comparable to, and potentially greater than, the finance delivered by four major multilateral finance institutions (World Bank, IDB, ADB, and EBRD).
• There is a perceived lack of commercial opportunities for adaptation projects, leading to a belief among BFIs that such activities require grant funding rather than debt or equity instruments.
• The participating institutions utilize a diverse range of financial instruments, including soft loans, equity, grants, and credit lines, though lending remains the dominant activity.
• Carbon finance is treated as a separate category from investment activities because it primarily involves purchasing emission reduction certificates to meet Annex I obligations rather than providing 'new and additional' finance.
• The institutions are in the early stages of integrating climate risk assessment and 'climate proofing' into their general business activities, with some implementing carbon footprinting tools and shadow carbon pricing.

APA

Atteridge, A., Siebert, C. K., Klein, R. J. T., Butler, C., & Tella, P. (2009). Bilateral Finance Institutions and Climate Change: A Mapping of Climate Portfolios. Stockholm Environment Institute. https://www.sei.org/mediamanager/documents/Publications/Climate-mitigation-adaptation/bilateral-finance-institutions-climate-change.pdf

Chicago

Atteridge, Aaron, Clarisse Kehler Siebert, Richard J. T. Klein, Carmen Butler, and Patricia Tella. Bilateral Finance Institutions and Climate Change: A Mapping of Climate Portfolios. Stockholm Environment Institute, 2009. https://www.sei.org/mediamanager/documents/Publications/Climate-mitigation-adaptation/bilateral-finance-institutions-climate-change.pdf.

Wikipedia

{{cite report |last1=Atteridge |first1=Aaron |last2=Siebert |first2=Clarisse Kehler |last3=Klein |first3=Richard J. T. |last4=Butler |first4=Carmen |last5=Tella |first5=Patricia |title=Bilateral Finance Institutions and Climate Change: A Mapping of Climate Portfolios |publisher=Stockholm Environment Institute |date=2009 |url=https://www.sei.org/mediamanager/documents/Publications/Climate-mitigation-adaptation/bilateral-finance-institutions-climate-change.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{atteridge2009bilateral, author = {Atteridge, Aaron and Siebert, Clarisse Kehler and Klein, Richard J. T. and Butler, Carmen and Tella, Patricia}, title = {{Bilateral Finance Institutions and Climate Change: A Mapping of Climate Portfolios}}, institution = {Stockholm Environment Institute}, year = {2009}, url = {https://www.sei.org/mediamanager/documents/Publications/Climate-mitigation-adaptation/bilateral-finance-institutions-climate-change.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }