Chapter 3 | TRACKING CLIMATE FINANCE
The Comparative Picture
Sectoral Distribution of Climate Finance
The OPEC Fund’s level of climate financing has notably ad- vanced in recent years. Comparing the baseline period of 2018-2021 to the year 2023, there has been a significant in- crease in total climate finance, rising from 17 percent in the baseline period to 34 percent in 2023. Adaptation finance increased from 5 percent to 17 percent, and mitigation finance increased from 11.5 percent to 18 percent, demon- strating significant progress over the course of just a few years. However, the number of projects is relatively small. As a result, the observed changes may represent shorter- term fluctuations over the last few years, rather than a broad and consistent trend. As the OPEC Fund continues to track its climate finance efforts, more defined trends and observations will become more apparent. The contribution of the OPEC Fund’s Public Sector oper- ations to the institution's climate financing has averaged around 70 percent over the baseline period, primari- ly driven by energy and multisectoral projects. Climate finance from the OPEC Fund’s Private Sector operations accounted for approximately 30 percent, also primarily driven by the energy sector, with additional contributions from banking and finance as well as multisectoral (financial intermediaries) projects.
SECTOR DEFINITIONS
Agriculture This sector encompasses all projects related to farming, livestock, fisheries and forestry. It includes initiatives aimed at improving agricultural productiv- ity, sustainability and resilience to climate change. Financial Institutions This sector includes financial institutions transac- tions, primarily loans to banks. It covers all financial services provided by banks and other financial insti- tutions, including credit, investment and insurance services that support various economic activities. Education This sector includes projects aimed at improving educational infrastructure, access to education and quality of education. It includes investments in schools, universities and vocational training centers as well as educational programs and initiatives. Energy This sector includes projects related to production, distribution and consumption of energy. It covers renewable energy projects (such as solar, wind and hydroelectric power), energy efficiency initiatives and other efforts to transition to sustainable energy sources. Multisectoral This category is used for projects that are cross-cut- ting and do not fit into a single sector. Multisec- toral projects might include initiatives that address climate resilience, energy transition and agriculture simultaneously. This classification is used for loans and other financial transactions that have impacts across multiple sectors. Transport This sector includes projects related to the develop- ment and maintenance of transportation infrastruc- ture. It covers roads, railways, airports, seaports and public transportation systems as well as initiatives aimed at improving transportation efficiency and sustainability. Other This category includes any projects that do not fit into the specific sectors mentioned above. It is a cat- egory for miscellaneous projects that have unique or diverse objectives.
Chart 1: Climate Finance Summary 2018-2023
100%
40%
42%
20%
32%
90%
35%
80%
30%
70%
34,4 %
33,4 %
25%
60%
50%
20%
40%
15%
30%
17 %
10%
20%
5%
10%
58%
80%
68%
0%
0%
Climate Finance (%)
Private Sector (%)
Public Sector (%)
Source: OPEC Fund climate finance reports, 2018-21, 2022 and 2023 See also Annex 7.3, Table 1 and Table 2
22
Powered by FlippingBook