The world is running out of time to prepare for worsening climate impacts, as global adaptation efforts continue to lag dangerously behind the growing scale of the crisis, warns the United Nations Environment Programme (UNEP) in its Adaptation Gap Report 2025: Running on Empty.

The report, released ahead of COP30 in Belem, Brazil, paints a stark picture, warning that developing countries alone will require over $310 billion annually for climate adaptation by 2035, an amount 12 times higher than current public financing levels.

The report underscores that the gap between what is needed and what is being delivered is not just financial, but also systemic.

While progress in adaptation planning and implementation has been made, the pace and scale of action remain far below what is required to protect lives, livelihoods, and economies from escalating climate shocks.

Inger Andersen, Executive Director, UNEP, cautioned that “every person on this planet is living with the impacts of climate change, including wildfires, heatwaves, desertification, floods, rising costs and more”.

He warns that that without urgent action to scale up adaptation funding, “we will face escalating” costs every year.”

A WIDENING ADAPTATION GAP

There is a caveat to the $310-billion gap for developing countries. Based on UNEP’s modelled estimates, when calculations are expanded to include the needs outlined in Nationally Determined Contributions (NDCs) and National Adaptation Plans, that figure climbs to $365 billion, and even higher when adjusted for inflation.

In stark contrast, international public adaptation finance flows dropped from $28 billion in 2022 to $26 billion in 2023, reversing recent gains.

This leaves an estimated finance gap of $284-$339 billion per year, or up to 14 times current levels.

The report warns that if these trends continue, the Glasgow Climate Pact goal of doubling international public adaptation finance from 2019 levels, to approximately $40 billion by 2025, will not be achieved.

When accounting for inflation, if the past decade’s inflation rate continues, the estimated adaptation costs for developing nations could reach $440-$520 billion per year by 2035, far outpacing the new global climate finance target.

Even the New Collective Quantified Goal (NCQG) adopted at COP29, which calls for, at least, $300 billion per year for climate action in developing countries by 2035, will fall short, since this amount covers both mitigation and adaptation combined.

UNEP also warns of growing debt risks for vulnerable nations. It said many countries are already struggling with high external debt and economic instability, making it difficult to finance adaptation without incurring additional borrowing.

The report urges the use of grants, concessional loans, and non-debt-creating instruments to prevent adaptation finance from exacerbating financial vulnerabilities.

While many countries have developed national adaptation plans, 36 out of 172 have not updated their strategies for more than a decade.

Such outdated instruments heighten the risk of maladaptation.

Moreover, although more than 1,600 adaptation actions have been reported under the Paris Agreement’s Biennial Transparency Reports, few countries are assessing their actual outcomes or effectiveness, leaving large gaps in measuring progress.

GLIMMERS OF PROGRESS AMID MOUNTING CHALLENGES

Despite the daunting figures, the report also highlights encouraging signs of momentum. Nearly all countries (172 in total) now have, at least, one national adaptation policy, strategy, or plan in place, reflecting a growing global consensus that adaptation is no longer optional but essential.

Only four countries have yet to initiate formal adaptation planning.

Financially, there has been a notable uptick in project support through international climate funds.

In 2024, new project commitments under the Adaptation Fund, the Global Environment Facility (GEF), and the Green Climate Fund (GCF) collectively rose to $920 million, representing an 86 per cent increase over the five-year moving average of $494 million (2019–2023).

Although UNEP cautions that this may be a temporary spike, it demonstrates that scaling up support is possible when political will aligns with financial mechanisms.

Encouragingly, the report points to new international frameworks designed to mobilise larger financial flows.

The Baku-to-Belem Roadmap, unveiled as part of the run-up to COP30, aims to raise $1.3 trillion by 2035 to help developing nations adapt to climate change.

Meanwhile, UNEP identifies substantial private sector potential, estimating that targeted policy actions and blended finance could expand private investment in national adaptation priorities to $50 billion per year, compared to just $5 billion currently.

To unlock that potential, UNEP calls for public and private finance to work in tandem, using concessional public funds to de-risk private investments and integrate climate resilience into mainstream financial decision-making.

This approach, the report argues, is essential to closing the adaptation finance gap without deepening debt burdens. — OGN / Trade Arabia News Service