Japan - Climate

Download
Download

Japan remains a leader in climate-related finance

In 2020, Japan’s official development assistance (ODA) targeting climate change as a principal or significant goal (see box) totaled US$15 billion, comprising 78% of its bilateral allocable ODA, according to Organisation for Economic Co-operation and Development (OECD) Development Assistance Committee (DAC) data. This represented a significant increase of 132% from 2019 (US$6.5 billion). Japan remains the highest DAC donor for climate-related ODA in relative terms and emerged as highest DAC donor in absolute terms in 2020.


Climate finance: funding for projects tagged in the OECD’s Creditor Reporting System (CRS) database with the Rio markers for climate change mitigation and/or climate change adaptation. Projects can be tagged with either or both markers.

Each marker has three possible scores:

  1. Principal, for projects in which climate change mitigation or adaptation is a fundamental and explicitly stated goal;
  2. Significant, for projects in which climate change mitigation or adaptation is not a key driver but still an explicitly stated goal; or
  3. Not targeted, meaning the project does not address climate change mitigation or adaptation.

Not all projects are screened against the Rio markers; this funding falls into the ‘not screened’ category.


Japan references both climate change mitigation and adaptation as priorities in its Development Cooperation Charter. In addition, the Japan International Cooperation Agency (JICA) Climate Cooperation Strategy (last updated in 2016) names four priority issues:

  1. Promoting low-carbon climate-resilient infrastructure;
  2. Enhancing climate risk management;
  3. Supporting climate policy and institution building; and
  4. Enhancing forest and other ecosystem conservation and management.

Commitments made at international climate conferences and in multi-party agreements also impact Japan’s climate-related ODA policies. At the G7 Cornwall Summit in June 2021, Japan committed to providing ¥6.5 trillion (US$61 billion, or US$12 billion annually) in climate finance to low- and middle-income economies from public and private sources over the next five years, from 2021 to 2025. This is the same level of its previous commitment made through the ‘Actions for Cool Earth 2.0’ (ACE) policy announced at the United Nations Climate Change Conference (COP21) in 2015. Among other actions, the policy committed Japan to provide ¥1.3 trillion (US$12 billion) annually in climate finance by 2020. At the COP26 summit in November 2021, Japan pledged an additional US$10 billion in climate finance, both public and private, bringing its total climate finance commitment to US$71 billion over the next five years. This includes a doubling of adaptation finance to US$14.8 billion to assist countries in adapting to climate change and preventing disasters.

In March 2022, Japan contributed US$42 million to UNDP’s ‘Climate Promise Initiative’ to assist 23 countries in meeting the Nationally Determined Contributions (NDCs), making it the largest donor in the next phase of this initiative. NDCs are climate change mitigation plans that set out national strategies to achieve the global targets set out in the Paris Agreement. The funding will support countries across Asia-Pacific, Central Asia, Europe, and Africa. Japan has also established the ‘Joint Crediting Mechanism’ (JCM), a bilateral offset mechanism that allows Japan to credit contributions of low-carbon technologies and expertise to low- and middle-income economies towards its own international emissions reduction commitments. Since establishing the JCM in 2011, Japan has signed agreements with 17 countries.

Major focus is on infrastructure and energy, and climate change mitigation; main channels include multilateral organizations

The bulk of Japan’s climate-related ODA is directed to projects in infrastructure (55%), with the remaining funding directed towards water and sanitation (14%), other multisector (10%), health (9%), and agriculture (5%). In 2020, Japan’s climate-related ODA experienced a massive shift in focus as more funds were channeled towards climate adaptation projects, which represented 69% of all climate-related ODA, as compared to climate change mitigation, which represented just 36%. 6% of Japan’s climate-related funding focused on both adaptation and mitigation.

Japan delivers a portion of its climate financing through multilateral institutions, though not all of this is counted as ODA. These include the following multilaterals:

  • Green Climate Fund (GCF), to which Japan has pledged US$1.5 billion for the 2020-2023 period. This follows Japan completing its initial pledge of US$1.5 billion to GCF for the initial period of 2015-2019.
  • Global Environment Facility (GEF) Trust Fund, Japan has been the largest contributor to the GEF Trust Fund, contributing US$3.3 billion since the establishment of the fund in 1992. Japan’s contributions to GEF are expected to continue growing, due to its US$638 million pledge to the 2018-2022 replenishment period.
  • United Nations Environment Programme (UNEP) Environment Fund, with a pledge of US$1 million made for 2022 (according to financial statements from UNEP). Starting in 2015, Japan also started making regular earmarked contributions to UNEP, which totaled US$5 million in 2021 and stands at US$2 million as at March 2022.

MOFA, MOF, and MOE direct climate finance-related ODA; JICA and other agencies implement

The Ministry of Foreign Affairs (MOFA), the Ministry of Finance (MOF), and the Ministry of the Environment (MOE) all hold responsibilities for setting priorities and directing climate finance-related ODA. Within MOFA, the Global Environment Division, led by Yasuyuki Kobayashi, and the Climate Change Division, led by Junichiro Otaka, are primarily responsible for formulating bilateral projects. These projects are typically implemented by JICA, with Vice President Tadashi Sato responsible for projects that address climate change and the environment. Given the high number of infrastructure projects that include climate finance components, the Ministry of Land, Infrastructure, Transport, and Tourism (MLIT) is also relevant in implementation. Additionally, MOE and the Ministry of Economy, Trade, and Industry (METI) both implement projects credited under the JCM.

 

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