Cities Alliance
The urban poor bear the brunt of climate change impacts, but is there enough climate finance dedicated to them? Discover what our analysis revealed.
The urban poor are among those least responsible for climate change, yet most affected. They are also critical leaders and agents of change in a green and just transition.
Urban poor underfunded by climate finance
In 2009, developed countries committed to mobilising USD 100 billion per year by 2020 for climate action in developing countries. This was finally met in 2022, according to the OECD, but there has been little analysis of how much climate finance is reaching the urban poor — up to now. Our analysis showed that about 2% of the projects financed by global public climate finance in the past 20 years targeted the urban poor, which represented only 3.5% of all funding from these critical sources.
Need for new funding mechanisms
The current funding share is inadequate to measurably improve the lives of people living in informal settlements, resulting in further climate injustices. Yet, the current emphasis on innovative finance focuses more on engaging financial institutions, banks and large scale private sector entities than accessibility for the poorest and most vulnerable. However, finance is truly innovative not because it comes from novel sources but because it improves the financial flows and ultimately the lives of the most vulnerable.
The urban poor need to be recognised
widely as an especially vulnerable group.
Is equitable climate finance possible?
The urban poor need to be recognised widely as an especially vulnerable group to climate change. Measurable targets and commitments to catalysing more finance which directly benefits them are needed. Decisions on allocating and spending these funds must fully include local communities, civil society organisations and local government leaders.
How can development organisations contribute?
Development organisations must work in true partnership with the urban poor, prioritising their needs and voices. They must support youth and women’s leadership at every stage of project development, implementation, monitoring and evaluation. Local communities should lead on data collection, site intervention areas and identification of activities.
Local communities are already committing their own resources for mitigation and adaptation. In a world where billions of dollars are mobilised for climate action, people with limited means should not be left to finance their own resilience and green transition efforts.
For more details, please refer to the recent Cities Alliance publication.
