Promises and reality of climate finance flows in Latin America and the Caribbean

The briefing highlights a significant funding gap in Latin America and the Caribbean (LAC), where current climate finance flows represent only 0.5% of regional GDP, far below the 3.7% to 4.9% estimated by ECLAC to meet Nationally Determined Contributions (NDCs). While developed nations eventually met the USD 100 billion annual pledge in 2022, the LAC region's share of international finance (17% between 2016-2020) consists largely of loans (81%), exacerbating regional debt. Financing is heavily concentrated in Brazil, Mexico, Costa Rica, and Colombia, with a strong preference for mitigation over adaptation projects.

• Latin America and the Caribbean (LAC) faces severe economic risks from climate change, with potential per capita GDP declines of 0.8% to 6.3% by 2030 and up to 23% by 2050. The agriculture, fishing, and forestry sectors are particularly vulnerable, representing 5.9% of the region's GDP in 2023.
• There is a massive shortfall in climate finance for the LAC region. To meet NDCs, annual investment is estimated between 3.7% and 4.9% of regional GDP (USD 215 billion to 284 billion) until 2030, but actual flows in 2020 were only 0.5% of GDP, necessitating an 8 to 10 times increase.
• Climate finance provided to the LAC region primarily increases debt rather than providing grants. Between 2016 and 2020, the region received 17% of international climate finance, but 81% of these funds were provided as loans. This occurs in a context where LAC countries account for 17% of global public debt.
• Climate finance distribution within the region is highly uneven and biased toward mitigation. Nearly half of the funding is concentrated in Brazil, Mexico, Costa Rica, and Colombia, and multilateral climate funds allocate over five times more to mitigation activities, such as reforestation, than to adaptation.

APA

Team, Z. (2024). Promises and reality of climate finance flows in Latin America and the Caribbean. Zero Carbon Analytics. https://zerocarbon-analytics.org/insights/briefings/promises-and-reality-of-climate-finance-flows-in-latin-america-and-the-caribbean/

Chicago

Team, ZCA. Promises and reality of climate finance flows in Latin America and the Caribbean. Zero Carbon Analytics, 2024. https://zerocarbon-analytics.org/insights/briefings/promises-and-reality-of-climate-finance-flows-in-latin-america-and-the-caribbean/.

Wikipedia

{{cite report |last1=Team |first1=ZCA |title=Promises and reality of climate finance flows in Latin America and the Caribbean |publisher=Zero Carbon Analytics |date=11 November 2024 |url=https://zerocarbon-analytics.org/insights/briefings/promises-and-reality-of-climate-finance-flows-in-latin-america-and-the-caribbean/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{team2024promises, author = {Team, ZCA}, title = {{Promises and reality of climate finance flows in Latin America and the Caribbean}}, institution = {Zero Carbon Analytics}, year = {2024}, month = nov, url = {https://zerocarbon-analytics.org/insights/briefings/promises-and-reality-of-climate-finance-flows-in-latin-america-and-the-caribbean/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }