Issue Deep Dive: US/Climate

Last updated: January 10, 2023

ODA Spending

ODA In Context

The US ranks seventh among DAC donor countries in terms of its spending on projects with some degree of climate focus.

The US is the third-lowest DAC donor to climate (3% of total bilateral allocable ODA; DAC average: 23%), relative to its total DAC spending.

Since 2016, the last year in which the Obama Administration was in office, US funding for climate has seen an annual decline of 12% on average, highlighting a steady decrease in commitment to climate measures throughout the tenure of former President Donald Trump. Despite the declined allocations under the Trump Administration, the Biden Administration’s climate plans signal a major shift in priorities for the US across all government departments and agencies.

The US spent just 1% (US$363 million) of its funding on projects with climate change mitigation or adaptation as a principal goal, which is much lower than the DAC average of 9%. The amount the US spends on projects with climate change mitigation or adaptation as a significant goal is marginally higher, at US$534 million, or 2%, of total allocable bilateral ODA spending (:abbrDAC average: 14%).

ODA Breakdown

Bilateral Spending

In line with overall US development priorities, the greatest share of US ODA for climate change goals in 2020 went to ‘environmental protection’ (US$232 million, or 26%) and ‘agriculture’ (US$221 million, or 25%). A far lower share goes to ‘food and commodity assistance’ (US$107 million, or 12%) and ‘health’ (US$69 million, or 8%).

In 2020, 53% of the USODA for climate change went to climate change mitigation. Meanwhile, 70% targeted adaptation. 23% of the US’ funding for actions against climate change was channeled toward projects tagged with both markers in 2020.

Multilateral Spending and Commitments

The US is a supporter of multilateral organizations working to fight climate change. Biden’s FY2023 budget request signals a shift toward reversing a deemphasis on climate policy under the Trump Administration, with a total of US$5.3 billion in funding requested for international climate programs.

Below are recent US commitments to climate multilaterals, though not all these funds are counted as ODA.

Funding and Policy Outlook

Climate change, including climate finance, is a major new priority: Once in office, President Biden reentered the Paris Agreement and, in April 2021, convened a two-day Leaders’ Summit with heads of state and government from 40 nations, resulting in multiple commitments to tackle the climate crisis, including the US' new target for reducing emissions by 50-52% by 2030 compared to 2005 levels. The Biden Administration will also focus on mobilizing finance for climate investments, including an intent to significantly increase the US contribution to global climate financing. Biden’s FY2023 budget proposal includes US$128 million in allocations to the GEF, new investments in the GCF (US$1.6 billion), and the Climate Technology Fund (US$550 million).

USAID launches new climate strategy: The new ‘ USAID Climate Strategy 2022-2030’ was launched on Earth Day (April 21, 2022) and guides USAID’s approach “to reduce global greenhouse gas emissions, help partner countries build resilience to climate change, and improve our operations.” USAID also has an ENRM framework which serves as an agency-wide guiding document to ensure USAID investments in all sectors consider their impact on the environment.

Taking a whole-of-government approach on climate: The Biden Administration has adopted a ‘whole-of-government approach’ to climate both from a domestic and global perspective and has announced several specific initiatives to help LICs meet climate challenges. The Department of State and USAID will work with partner countries to help plan and meet their strategies for zero emissions and climate-resilient futures. Biden has also added a Special Envoy on Climate at a cabinet-level rank for the first time in history.

Key Bodies

Explainer: Analysis is based on [Rio markers]( climate marker handbook_FINAL.pdf) for climate change mitigation and climate change adaption in the CRS. Each marker has 4 possible scores: principal, significant, screened, not targeted, and not screened. We count investments scored as principal as the narrow or lower bound estimate and funds scored as either principal or significant as the wider or upper-bound estimate.

Data presented is bilateral funding only. Refer to section (‘Multilateral climate finance’) below for discussion on the donor’s multilateral contributions to climate finance

Unless otherwise indicated, all data in this section is based on commitment. For more information, see our Donor Tracker Codebook.

Adam Jennison

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