Bridging the gap

A growing burden for climate finance?

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Economic conditions are making it more difficult for the public sector to fund action on climate change.

One of the most challenging issues is the growing gap in commitments made on climate finance.

Research from Oxford Economics shows that in 10 key markets there was a decrease in absolute expenditure on climate action in six countries (Germany, Spain, Italy, Japan, Australia and Korea), little change in France and an increase in spending from the UK, US and South Africa in the 12 months from 2010 to 2011

The decreases from last year’s figures may seem marginal but they suggest that continuing austerity measures are having an impact on climate change spending. A clearer picture of the effect of reducing climate change spending can be seen in the funding gap that emerges in the 2012 to 2016 period.


How to bridge the climate finance gap?

As the economic crisis deepens, and globally it becomes obvious that governments have little capacity to fill the climate finance gap, new and innovative measures must be considered.

This funding gap only amplifies the need for financial innovation to unlock the capital markets and leverage private investment into the climate change space. Government can help by providing the framework and encouraging investment from the private sector.








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