Financing Summit Boosts Debt Swaps, Trump Bill Hinders US Resilience, Allianz Adaptation Platform, and More

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World leaders agreed on a blueprint for closing the US$4trn sustainable development finance gap at a global summit last week, embracing initiatives that could advance climate adaptation and nature preservation in vulnerable regions. However, the absence of the US from discussions means implementation could prove difficult. 

The Fourth International Conference on Financing for Development (FFD4) in Seville aimed to scale-up financing for the Sustainable Development Goals (SDGs) — the 17 UN targets on climate, nature, and poverty that are meant to be achieved by 2030. The gathering ended with adoption of the Seville Compromise, a non-binding commitment that pushes countries to invest more in the Global South and retool the international financial system to better support development goals.

The accompanying Seville Platform for Action (SPA) includes over 130 actions to implement the Compromise. These include changes to the workings of international financing institutions so that developing countries have more of a voice, and new efforts to alleviate the debt burdens of developing nations — which lack the fiscal space to invest in life-saving climate risk mitigation efforts. Initiatives aimed at increasing the lending capacity of development banks and boosting cooperation against tax evasion also feature. “This platform has sparked new partnerships, innovative solutions that will deliver real change in people’s lives,” said UN Deputy Secretary-General Amina Mohammed. “They’re not a substitute for broader funding commitments, but a sign that creative thinking is finally breaking through.” 

How many of these actions will be followed through by developed countries remains to be seen. In-person support for the conference was thin on the ground, with French President Emmanuel Macron the only G7 leader to attend in person. The US, in keeping with the Trump administration’s retreat from multilateral initiatives, did not send a delegation at all.

Among the initiatives launched at FFD4 that could help strengthen countries’ climate resilience is the Global Hub for Debt Swaps for Development. Backed by Spain and the World Bank, the Hub aims to help poorer nations speed up debt-for-nature and other swap deals, which can free up funds for climate adaptation, conservation, and social services. The new initiative has been seeded with €3mn (US$3.5mn) by the Spanish government and will be supported by a new World Bank trust fund.

Debt-for-nature swap transactions have recently surpassed US$6bn, with Ecuador closing two deals exceeding US$1bn to finance conservation projects in the Galapagos and Amazon.

The Green Climate Fund (GCF) approved a record US$1.225bn for 17 new climate projects last week, marking its largest single funding round to date against a backdrop of reduced US support for multilateral climate finance. The latest approvals expand GCF’s portfolio to US$18bn in direct financing across 314 projects, and to US$67bn once co-financing from other public and private investors is taken into account. The GCF aims to evenly balance allocations to climate mitigation and adaptation goals. Among the latest adaptation funding proposals approved was one for strengthened climate services and an impact-based multi-hazard early warning initiative in the Maldives, and a US$227mn investment in a green bond initiative for sub-Saharan Africa. (Green Climate Fund)

A global survey of 32 banks by UNEP FI and Global Credit Data reveals that while lenders are making strides in incorporating climate risks into credit risk frameworks, progress remains uneven and data gaps continue to hamper efforts. While most institutions are integrating climate factors into credit decisions, risk reporting, and client engagement, fewer than half have embedded climate risk into capital estimates or loan-loss provisioning, and many still rely heavily on expert judgment over data-driven models. Banks cite challenges ranging from poor data quality to modeling complexities, suggesting changes to in-vogue methodologies may be needed to make climate risk calculations more robust. (UNEP FI)

The UK’s climate aid spending hit a record £3bn (US$4bn) last year, according to Carbon Brief analysis. However, nearly a fifth of this was driven by an accounting change that counts more overseas spending by British International Investment (BII) as climate finance. This shift, along with other methodological changes, is making it easier for the government to hit its £11.6bn (US$16bn) five-year target by 2026 despite deep cuts to the overall aid budget. (Carbon Brief)

The World Bank has approved a €360mn (US$390mn) guarantee to back Turkey’s ‘Financing Adaptation for Growth Project,’ which is aimed at promoting private-sector climate resilience and unlocking private capital for adaptation. The initiative will fund firm-level adaptation measures via financing and the production of an ‘Adaptation Toolkit’ that helps with measuring climate risk. (World Bank)

California is allocating nearly US$5bn of public money to strengthen the climate resilience of the state’s transportation systems. The California Transportation Commission approved US$3.5bn for road, pedestrian, and bike infrastructure and earmarked another US$1.45bn for projects through 2027 targeting zero-emission transport and freight network improvements. The funds are being drawn in part from California’s Road Repair and Accountability Act of 2017 and the federal Infrastructure Investment and Jobs Act of 2021. (California Department of Transportation)

President Trump’s sweeping tax and spending bill is likely to undermine US climate and energy resilience and starve communities of adaptation finance.

The so-called “big, beautiful bill”, signed into law on July 4, repeals key provisions of the Biden-era Inflation Reduction Act (IRA), gutting clean energy tax incentives intended to bolster US grid capacity and rescinding billions in federal funding for programs designed to enhance power systems and protect communities from climate impacts.

All unobligated amounts under the US$27bn Greenhouse Gas Reduction Fund (GGRF), the US$5bn Climate Pollution Reduction Grants, and the US$3bn Environmental and Climate Justice Program introduced under the last administration are being cancelled, depriving clean energy and resilience projects of hoped-for funds. While analysis suggests that the majority of these dollars have already been obligated, this fact hasn’t stopped the Trump administration from trying to freeze or claw back the allocations before now. With the spending bill’s passage, Congress and the White House may redouble their efforts on this front.

The legislation also phases out credits for wind, solar, electric vehicles, clean manufacturing, and home efficiency, putting at risk more than US$500bn in already announced clean energy and industrial investments. Modeling from the Rhodium Group warns that the rollback could slash new clean electricity additions by 57-72% by 2035, while household energy costs could rise US$94-290 on average as Americans pay more for electricity, gasoline, and diesel. The changes will make the grid less reliable and susceptible to outages at times of extreme heat and cold, and in the wake of extreme weather events.

Alice Hill, Senior Fellow for Energy and the Environment at the Council for Foreign Relations, and tomorrow’s Climate Proof podcast interviewee, said last week that the bill “undermines US resilience to extreme weather” by cutting investments in energy efficiency and ending tax breaks for rooftop solar. “Like energy efficiency measures, rooftop solar can reduce demand on the grid, which means fewer brownouts and blackouts, and it can give households a backup power supply when the grid is stressed.”

The deadly Fourth of July flash flood in Texas, which has claimed at least 80 lives, has exposed gaps in federal disaster preparedness and underlined the deficiency of local early warning systems. Although the National Weather Service (NWS) issued multiple warnings ahead of the storm, officials and experts are questioning whether staffing shortages initiated by the Trump administration’s far-reaching cuts hampered their effectiveness. The New York Times also reports that Kerr County, the epicenter of the floods, considered installing an advanced flood warning system in 2017, but ultimately passed on the initiative because of cost concerns. Texas Governor Greg Abbott has suggested that an upcoming special session of the state legislature could bring up legislation aimed at improving emergency warning systems. (New York Times)

A website hosting federal climate risk reports has been taken down by the Trump administration. The Global Change Research Program website included all National Climate Assessments — the periodic climate risk and adaptation reports required by Congress. A White House spokesperson said the reports would now be hosted by NASA, but no timeline has been provided. In April, the Trump administration cut funding to the Global Change Research Program and dismissed the researchers working on the upcoming Sixth National Climate Assessment, which is scheduled for release in 2028. (Associated Press)

The National Oceanic and Atmospheric Administration (NOAA) would lose all its climate research functions and funding for climate, weather, and ocean studies as part of cuts floated by the Trump White House. Among other things, the 2026 budget proposal would eliminate regional climate and weather laboratories, defund grants for coastal zone management, and end NOAA support for the Climate Adaptation Partnerships program, which empowers regional teams to analyze, prepare for, and respond to climate shocks. Rick Spinrad, former NOAA administrator, wrote on LinkedIn that the proposal was "dangerous, ignorant, and indefensible.” (NOAA)

The European Commission has adopted measures to simplify the EU Taxonomy, which is used by companies to show how their activities align with the bloc’s climate and sustainability goals. Under the new rubric, companies do not have to assess the Taxonomy-eligibility and alignment of non-material business, and the number of datapoints for public disclosure has been slashed by 64% for corporations and by 89% for financial institutions. In addition, key performance indicators for the financial sector —such as the ‘Green Asset Ratio’ — have been stripped back. The changes are part of the ‘Omnibus I’ package of reforms to the EU’s sustainability rules, and will take effect in January 2026, pending European Parliament and Council approval. (European Commission)

The UK Green Building Council (UKGBC) has launched the UK Climate Resilience Roadmap, which outlines the vulnerability of the UK’s built environment to climate hazards, like overheating and flooding. Cities including Peterborough and Fairbourne are shown to be at risk of catastrophic flooding by the century’s end, which could render them uninhabitable. The report calls for immediate government action, including the establishment of an Office for Resilience and reinstatement of the Minister for Resilience, to prepare for projected temperature increases and extreme weather events. (UKGBC)

The Federated States of Micronesia has launched a climate and health initiative to tackle a spike in climate-sensitive diseases, from dengue fever to diarrhea. Backed with US$17.9mn from the Green Climate Fund and delivered by the multilateral organization the Pacific Community, the five-year program aims to climate-proof FSM’s health infrastructure, strengthen disease surveillance, and embed climate resilience in national health policies. (Pacific Community)

A unit of global insurance giant Allianz has launched Climate Adaptation & Resilience Services (CAReS), a data-driven platform aimed at helping businesses navigate worsening climate risks.

The tool from Allianz Commercial allows companies to assess how 12 natural perils — including floods, wildfires, tropical storms, and extreme heat — could impact their operations and assets today and under different climate scenarios through to 2080. The self-service platform can be supplemented with tailored consultancy from Allianz professionals.

The company’s innovation comes as the financial impacts from climate-related disasters continue to surge. Analysis by reinsurer Munich Re shows 2024 losses from floods, storms, hail, and similar events reaching US$327bn globally, of which just US$138bn was insured. Allianz says that proactive adaptation can help shield companies from these hazards and keep insurance costs from spiraling out of control. 

CAReS offers businesses a structured five-step process to identify and prioritize vulnerable assets and supply chains using dashboards that display risk scores across multiple time horizons. The platform is also able to translate physical climate risks into financial loss metrics at both the portfolio and site level, helping businesses make better informed resilience investment decisions.

The CAReS platform is the first in a planned suite of solutions Allianz Risk Consulting intends to roll out this year as part of a new strategic focus on climate resilience. 

The Famine Early Warning Systems Network (FEWS NET) has resumed operations following a halt caused by the Trump administration’s cutback of US foreign aid. The Network draws on satellite technologies and on-the-ground expertise to predict food crises and equip policymakers and non-profits with data and insights needed to save lives and secure communities. (FEWS NET)

Agrobiomics, a Danish agtech firm, has clinched up to €7.5mn (US$8.8mn) to roll out biostimulants that can make crops more resilient to drought and salinity. The blended financing award, granted by the European Innovation Council Accelerator, is intended to bring Agrobiomics’ first products for soybeans and tomatoes to market and support the company’s plans to expand to cereals and other crops across climate-stressed regions. (Agrobiomics)

HVAC service provider Climate Efficiency Partners (CEP) has acquired Tri-Tech Energy, a company specializing in preventative maintenance, repair, and installation for HVAC systems based in New Jersey. CEP’s purchase was facilitated by 424 Capital, a private equity firm focused on the energy transition and healthcare sectors. Indoor cooling providers have been identified as key beneficiaries of the climate adaptation investment trend by multiple financial institutions in recent publications. (Climate Efficiency Partners)

Rising surface salinity and declining sea ice: A new Southern Ocean state revealed by satellites (PNAS)

Extreme weather event attribution predicts climate policy support across the world (Nature Climate Change)

Mainstreaming the local climate zone framework for climate-resilient cities (Nature Communications)

Financing a sustainable future: the effectiveness of climate finance across the primary, energy, and water sectors (Humanities and Social Sciences Communications)

Climate change impacts on crop yields across temperature rise thresholds and climate zones (Scientific Reports)

Reversing climate progress: consequences and solutions in the wake of US policy rollbacks (NPJ Climate Action)

Coupled, decoupled, and abrupt responses of vegetation to climate across timescales (Science)

High-frequency data reveal limits of adaptation to heat in animal agriculture (Science Advances)

UN Global Risk Report (UN)

Climate change, firms, and aggregate productivity (Centre for Economic Policy Research)

Modeling neighborhoods as fuel for wildfire: A review (Fire Technology)

Thanks for reading!

Louie Woodall
Editor