As the impacts of climate change intensify, the need for increased financing to support adaptation efforts is gaining urgency. The upcoming UN Climate Change Conference, COP 29, represents a critical juncture where world leaders can take decisive action to mobilize the necessary resources to help vulnerable countries and communities adapt to the changing climate.

Empowering Adaptation: Securing a Sustainable Future

Defining the New Collective Quantified Goal

At the heart of the adaptation finance discussion is the New Collective Quantified Goal (NCQG), which will be a key focus at COP 29 in Baku, Azerbaijan. Building upon the existing $100 billion annual climate finance target, the NCQG will shape the structure, quantum, and focus of climate finance commitments for years to come. Historically, adaptation has received less attention than mitigation, with less than one-third of the $100 billion goal allocated to adaptation efforts. Ensuring adequate resources for adaptation will require a dedicated focus within the NCQG, potentially through the establishment of a specific subgoal for adaptation finance. This would safeguard adaptation as a distinct area of investment and guide the delivery of funding to better meet the needs of developing countries, which are bearing the brunt of climate impacts despite contributing the least to the crisis.

Strengthening the Adaptation Fund

The Adaptation Fund, the only climate fund dedicated exclusively to adaptation, has a crucial role to play in scaling up climate adaptation finance. Since 2010, the Adaptation Fund has committed over $1 billion for climate change adaptation and resilience projects, pioneering the "direct access" approach that allows developing countries to obtain funds without intermediaries and take charge of their own adaptation implementation. Recently, the Adaptation Fund has also opened a window for locally led adaptation, enabling community-based organizations, Indigenous groups, and local governments to access resources and make decisions about how funds are utilized. At COP 29, the Adaptation Fund aims to raise $300 million to finance its project pipeline, and it is essential that developed countries ensure this target is met or exceeded to maintain the momentum in scaling up adaptation efforts.

Leveraging the International Development Association

Another crucial opportunity for boosting adaptation finance lies in the upcoming International Development Association (IDA) replenishment meeting in December, following COP 29. As part of the World Bank, the IDA provides concessional funding to the world's least developed countries, supporting various adaptation measures through grants and low-interest loans. Without adequate financial support from the IDA, the most vulnerable countries would be left with even fewer resources to address the growing climate challenges they face. The December pledging session will be a pivotal moment for strengthening this essential financing pipeline and ensuring that adaptation finance from multilateral development banks receives a significant boost to meet the ever-increasing demand for support.

Evolving the Role of International Finance Institutions

International finance institutions (IFIs), such as the World Bank and the International Monetary Fund, play a crucial role in mobilizing adaptation finance. As adaptation financing needs evolve, so too must the role of these institutions. The Bridgetown Initiative, championed by Barbados Prime Minister Mia Mottley, advocates for bold reforms to change how these institutions are governed and function. This includes increasing funding and concessional lending to developing nations to support climate resilience, as well as restructuring repayment terms after climate disasters to prevent debt crises. Additionally, the initiative calls for the International Finance Corporation (IFC), the private sector arm of the World Bank Group, to expand its efforts in unlocking private capital for adaptation services, which could channel investments into underserved markets and drive innovation.

Mainstreaming Adaptation in Development Finance

There is also a growing push to mainstream adaptation finance in broader development frameworks. The UAE Global Climate Resilience Framework, established at COP 28, embeds climate resilience across seven sectoral targets, providing a useful framework to guide mainstreaming investments. Looking ahead, the Fourth International Conference on Financing for Development in late June 2025 offers a significant opportunity to further integrate adaptation into international financing discussions. By aligning development finance with climate adaptation and resilience goals, this conference can help ensure that climate resilience is a central consideration in broader development funding strategies.

A Critical Juncture for Adaptation Finance

The coming months present a critical window of opportunity to scale up adaptation finance. Key decisions will be made both within and outside the climate regime, and engaging ministers of finance will be essential to prioritize reforms supporting adaptation and harness the intersection between adaptation and development agendas. The opportunity cost of inaction is high, as delays in adaptation will result in increased suffering for communities on the front lines of climate change, as well as more challenging and costly recoveries. As the world approaches COP 29 and looks beyond, it is crucial to seize these opportunities to secure a resilient future for all.