Multilateral Development Bank Climate Finance in 2018: The Good, the Bad and the Urgent

This briefing by the World Resources Institute analyzes the 2018 Joint Report on Climate Finance from six major multilateral development banks (MDBs). While total climate finance commitments reached a record $43 billion in 2018, the analysis highlights disparities in bank performance, challenges in mobilizing private investment, and the urgent need for MDBs to align their entire portfolios with the Paris Agreement.

• Multilateral Development Bank (MDB) climate finance commitments reached a record $43 billion in 2018, representing a 22% increase from the $35 billion committed in 2017. The World Bank Group and European Investment Bank (EIB) have already achieved their 2020 climate finance targets, and the African Development Bank (AfDB) is on track to meet its goal.
• The proportion of MDB climate finance dedicated to adaptation rose from 23% in 2016 to 30% in 2018, though distribution varies significantly by institution. In 2018, nearly half of the AfDB's climate finance was for adaptation, whereas the EIB and European Bank for Reconstruction and Development (EBRD) allocated 8% and 12% respectively.
• Climate finance for the most vulnerable regions increased, with the share for Least Developed Countries and Small Island Developing States rising from 10% last year to 16% this year, closer to their population share of approximately 17%.
• Several MDBs experienced a decline in the relative or absolute scale of their climate funding. The Asian Development Bank (ADB), EBRD, and Inter-American Development Bank Group (IDBG) saw climate finance grow more slowly than their total financing. Specifically, absolute climate finance fell by 23% for the ADB and 17% for the EBRD between 2017 and 2018.
• MDBs struggle to mobilize private sector investment compared to public sources. Between 2016 and 2018, every dollar of MDB climate finance mobilized $0.87 from public sources (such as national governments and other development funders) but only $0.62 from private sources, despite a steady increase in the overall co-financing ratio from $1.38 in 2016 to $1.58 in 2018.
• There is an urgent need for MDBs to align their entire portfolios with the Paris Agreement by ceasing investments in high-emissions activities. Nine MDBs, including the Asian Infrastructure Investment Bank, the Islamic Development Bank, and the New Development Bank, announced a joint approach to alignment to be presented at the COP 25 negotiations in Chile.

APA

Thwaites, J. (2019). Multilateral Development Bank Climate Finance in 2018: The Good, the Bad and the Urgent. World Resources Institute. https://www.wri.org/insights/multilateral-development-bank-climate-finance-2018-good-bad-and-urgent

Chicago

Thwaites, Joe. Multilateral Development Bank Climate Finance in 2018: The Good, the Bad and the Urgent. World Resources Institute, 2019. https://www.wri.org/insights/multilateral-development-bank-climate-finance-2018-good-bad-and-urgent.

Wikipedia

{{cite report |last1=Thwaites |first1=Joe |title=Multilateral Development Bank Climate Finance in 2018: The Good, the Bad and the Urgent |publisher=World Resources Institute |date=21 June 2019 |url=https://www.wri.org/insights/multilateral-development-bank-climate-finance-2018-good-bad-and-urgent |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{thwaites2019multilateral, author = {Thwaites, Joe}, title = {{Multilateral Development Bank Climate Finance in 2018: The Good, the Bad and the Urgent}}, institution = {World Resources Institute}, year = {2019}, month = jun, url = {https://www.wri.org/insights/multilateral-development-bank-climate-finance-2018-good-bad-and-urgent}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }