Australia markets closed
  • ALL ORDS

    7,709.50
    +21.50 (+0.28%)
     
  • ASX 200

    7,493.80
    +25.50 (+0.34%)
     
  • AUD/USD

    0.7106
    -0.0011 (-0.15%)
     
  • OIL

    79.38
    -1.63 (-2.01%)
     
  • GOLD

    1,927.60
    -2.40 (-0.12%)
     
  • BTC-AUD

    32,186.33
    -410.05 (-1.26%)
     
  • CMC Crypto 200

    526.66
    +9.65 (+1.87%)
     
  • AUD/EUR

    0.6535
    +0.0006 (+0.09%)
     
  • AUD/NZD

    1.0934
    -0.0026 (-0.24%)
     
  • NZX 50

    12,036.05
    +12.59 (+0.10%)
     
  • NASDAQ

    12,166.60
    +115.12 (+0.96%)
     
  • FTSE

    7,765.15
    +4.04 (+0.05%)
     
  • Dow Jones

    33,978.08
    +28.67 (+0.08%)
     
  • DAX

    15,150.03
    +17.18 (+0.11%)
     
  • Hang Seng

    22,688.90
    +122.12 (+0.54%)
     
  • NIKKEI 225

    27,382.56
    +19.81 (+0.07%)
     

Climate change: Oxfam warns Australia at risk of 'shortchanging' poor nations

A man and a boy walking down a flooded street in Sri Lanka in 2021. Extreme weather events are linked to climate change.
Many developing nations are being disproportionately impacted by the climate crisis. Source: Getty

Wealthy nations may have been using “dishonest and misleading accounting” to overestimate funding allocated to mitigate the impact of climate change, a new report alleges.

International NGO Oxfam highlights that a 2009 UN climate summit promise to assist developing countries with an annual spend of US$100 billion ($158 billion) by 2020 was not met.

While wealthy nations reported contributing US$68.3 billion in 2020, Oxfam alleges the “true value” of these commitments was likely just US$21 billion-US$24.5 billion.

A contributing factor is that rich countries are “at risk” of double-counting spending, the charity's Climate Finance Short-Changed report alleges.

Released on Wednesday, the report suggests that in some instances, overseas development aid may have been counted as climate-specific financing - which should explicitly be used for purposes of mitigation, adaptation, loss and damage.

The charity was also concerned that loans - rather than grants - comprised the majority of expenditure, making up an estimated $48.6 billion of public climate finance, which Oxfam said worsened the “debt crisis” many developing nations faced.

Is Australia meeting its international obligations?

Oxfam Australia chief executive Lyn Morgain said that, by “overstating their generosity”, wealthy nations had left the most vulnerable nations “ill-prepared to face the wrath of the climate crisis”.

Morgain told Yahoo Finance Australia was “a leading voice” in the establishment of the 2009 commitment, but it had “come nowhere near close” to delivering on its promises.

She believes Australia has spent around AUD$400 million, well below what Oxfam calculates should be its fair share of spending - AUD$4 billion.

“That's before you add in the equation about how great our responsibility is as a consequence of our status as a heavier emitter,” Morgain said.

“Or before we get into the issues about who caused the problem, and who's suffering the most and how immediately.”

Oxfam calls for increase in climate spending

Oxfam Australia is calling for an immediate increase to AUD$3 billion, even though that would still be shy of the full commitment it thinks the nation should be making.

Morgain noted that Australia was “desperately wishing to demonstrate our strong commitment” to the Pacific, but she was concerned a “significant amount” of climate spending was not being allocated to “locally identified priorities”.

“The risk is that the money is being spent on Australia’s national priorities,” she said.

“So that could be infrastructure … being counted as mitigation or adaptation financing in relation to climate that may or may not be properly aligned with the interests of locals.”

Morgain is urging the government to increase transparency in its reporting of climate spending.

Foreign Minister Penny Wong has been contacted for comment.

Follow Yahoo Finance on Facebook, LinkedIn, Instagram and Twitter, and subscribe to the free Fully Briefed daily newsletter.