03 ISSUE III
FEBRUARY 2025
FEBRUARY 2025
To Decolonize Climate Finance
Developing nations, bearing the most climate change impact, have little say in climate finance allocation, as wealthy nations dictate terms to serve their interests.
By Eunice Offei
Mia Mottley, the Prime Minister of Barbados, put it bluntly at COP26 in Glasgow in November 2021: “Are we now to face double jeopardy by having to pay the cost as a result of [your] actions?” As part of the Small Island Developing States (SIDS), a group of about forty states, Barbados is demanding climate finance as protection against the adverse effects of climate change. Mottley has emerged as a leader of this effort. Decolonizing climate finance is not just about fairness—it is about survival.
In the last decade, Barbados has experienced extreme weather events, water scarcity, coastal erosion, massive flooding, and the degradation of its marine ecology because of climate change. The reality is stark: the world’s most vulnerable nations are left to fend for themselves while wealthier nations dictate the terms of their survival.
Climate change poses an existential threat to humanity. Its impacts—manifesting as droughts, floods, sea-level rise, and extreme weather events—are global in scope but unevenly distributed in intensity. Developing countries, particularly in Africa and SIDS, bear a disproportionate burden of these consequences despite contributing the least to global greenhouse gas emissions. For these nations, climate change is not only an environmental crisis but one of survival and also a socioeconomic one, exacerbating poverty, inequality, and vulnerability. This has given rise to an urgent need for effective climate mitigation and adaptation strategies underpinned by robust financial support from the global community.
The term Climate Finance is used to refer to financial resources whose purpose is to support mitigation and adaptation action on climate change. It has emerged as a cornerstone of global efforts to combat climate change, enabling vulnerable nations to adapt to its impacts and transition to low-carbon economies. However, the mechanisms and structures underpinning climate finance often replicate historical power imbalances, raising questions about equity and justice in global climate governance.
The history of climate financing is deeply tied to the evolution of international climate agreements, each reflecting the global community's shifting priorities and power dynamics. At the heart of these dynamics lies the question of responsibility and justice. Financial mechanisms like the Green Climate Fund (GCF), established under the United Nations Framework Convention on Climate Change (UNFCCC), were designed to address these disparities. By prioritizing the needs of vulnerable nations and balancing support between mitigation and adaptation, the GCF represents a pivotal effort to bridge the gap between climate ambition and action. Yet, despite its transformative potential, the GCF has been criticized for perpetuating neocolonial dynamics that constrain the sovereignty and agency of recipient nations. Donor countries, primarily from the Global North, wield disproportionate influence over its governance and funding priorities, often sidelining the voices and needs of the Global South.
Rather than empowering recipient nations, the structure of climate finance often deepens their dependence on external funding. Many funds, including those from the GCF, come with bureaucratic hurdles that make access difficult for the very countries they are meant to support. Complex accreditation processes and stringent reporting requirements disproportionately disadvantage smaller nations and local organizations that lack the institutional capacity to navigate these systems. Moreover, much of climate finance is disbursed through loans rather than grants, burdening countries grappling with debt. This is not climate justice—it is economic entrapment. Countries that have contributed the least to the climate crisis should not have to borrow money to survive it.
Framing is a theoretical concept that refers to how issues, events, or ideas are presented and interpreted through specific lenses that emphasize particular aspects. In policy and governance, frames define who or what is considered relevant, legitimate, or actionable, affecting decisions and outcomes. From a decolonial perspective, framing examines how colonial legacies and epistemologies shape knowledge production, global governance, and power dynamics. Framing in decolonial studies, therefore, involves exposing and challenging these colonial assumptions, highlighting how they influence policies, development strategies, and global relations.
How climate finance is framed fundamentally shapes how resources are mobilized, distributed, and perceived. At its core, climate finance operates within two dominant yet conflicting narratives: as a form of aid—a voluntary act of generosity from developed nations—and as justice—a reparative mechanism acknowledging historical and present responsibility for climate change. These framings are not neutral but reflect broader power dynamics and ideologies that influence global climate governance and perpetuate inequalities between the Global North and the Global South.
A decolonial approach to climate finance would reframe it as a tool for justice rather than charity, requiring fundamental changes to both governance structures and funding mechanisms. Developing nations, particularly those most affected by climate change, must have a greater voice in climate finance negotiations. This ensures that recipient countries—not just donor nations—set priorities and influence how funds are allocated. Mitigation projects, such as renewable energy initiatives, often attract more funding due to financial returns and alignment with donor interests, adaptation, and loss-and-damage financing—critical for frontline communities—that remain underfunded. A justice-based climate finance model would reverse this imbalance, ensuring vulnerable populations receive adequate support. Additionally, current mechanisms must remove bureaucratic hurdles and simplify access to funding. Instead of pushing vulnerable nations deeper into debt through loans, climate finance should be provided primarily through grants, recognizing the historical and ecological debt wealthier nations owe to the Global South.
Decolonial climate finance reforms must be institutionalized across multiple levels of governance. At the international level, these changes should be embedded in legally binding agreements under the United Nations Framework Convention on Climate Change (UNFCCC), ensuring that financial commitments are enforceable rather than voluntary. Future updates to the Paris Agreement should include explicit provisions for direct, unconditional funding to developing nations. At the institutional level, reforms to the Green Climate Fund (GCF) and other financial instruments should remove donor-imposed conditions, prioritizing direct access for recipient countries and frontline communities. Additionally, multilateral development banks (MDBs) such as the World Bank and the International Monetary Fund (IMF) must shift from loan-based climate financing to grant-based models that acknowledge the ecological debt owed to the Global South. Nationally, climate-vulnerable countries should be empowered to design and implement their own financial mechanisms, ensuring that funding reaches local communities without external interference.
The current climate finance system must be restructured to reflect the principles of equity and historical accountability. Without such changes, climate finance will continue to reinforce the power imbalances that have shaped the climate crisis. A just system would ensure that climate finance is not an extension of neocolonial control but a tool for global solidarity and reparative justice. It is time to shift from aid to justice because anything less is climate injustice.
Eunce Offei is a Public and Urban Policy Ph.D. student at The New School.