Climate Change

Countries are working to grow their economies, lift people out of poverty, and create jobs, while confronting droughts, storms, and floods that are hitting harder and more often. The fast-approaching demographic surge in emerging markets presents a challenge and an opportunity as we work to create enough jobs for the young people who need them. Meeting it will require countries to invest in the foundational infrastructure—roads, power, digital access, nature, education, clean air and water, and health systems—that connects people to opportunity. It will also demand policy and regulatory reforms that make economies more competitive and transparent, and financing that mobilizes private capital at scale.

This is why the World Bank Group is focused on doing development right: resilient, fiscally sound, efficient, and built to last: smart development. We are supporting our public and private clients to achieve their smart development goals, which include meeting their own Nationally Determined Contributions (NDCs). This includes building low-carbon, resilient infrastructure and energy systems that manage emissions responsibly so countries can create jobs and sustain growth.

Smart development builds communities’ resilience to climate change and helps companies operate more efficiently and competitively.

It means investing in adaptation: building roads that can withstand a flood and well-insulated schools so outside temperatures don’t hinder learning inside; and helping farmers source drought-resistant seeds and irrigation, so a dry season doesn’t wipe out the harvest or income. It also means investing in mitigation that manages emissions responsibly: shifting freight from trucks to rail, transit buses from diesel to electric, and growing more rice with less water that also reduces methane emissions.

We do this by engaging across the full value chain: analytics, policy development, standard setting, public and private investment, and private capital mobilization. We also work to scale sustainable finance, well-functioning carbon markets, and green buildings.

The World Bank Group is supporting our clients to achieve their smart development goals, which include meeting their own Nationally Determined Contributions (NDCs). This includes projects that are building resilience, or that are managing emissions responsibly.

The World Bank Group delivered $50.8 billion in development finance (48% of WBG financing) with climate co-benefits under the shared MDB methodology in fiscal year 2025—which covers July 1, 2024 to June 30, 2025. Within that, resilience made up 43% of the public sector portfolio—up from one-third just two years ago. Building resilience means we build roads that can withstand a flood, and schools with insulation and reflective roofs, so outside temperatures don’t impact learning inside. We help farmers source drought-resistant seeds, so a dry season doesn’t wipe out the harvest or income. Mitigation means smart development that manages emissions responsibly. In addition to disclosing climate co-benefits (mitigation and adaptation) data for each project, the World Bank started disclosing sub-project level climate co-benefits data, from April 1, 2025 and climate co-benefits at the close of each project from July 1, 2025.

We are guided by our Climate Change Action Plan 2020-2026, which outlines our support to countries to accelerate their development ambitions in line with their own nationally determined contributions and long-term strategies.

We have supported 91 countries with the analytical basis to accelerate their development ambitions in line with their own nationally determined contributions and long-term strategies through Country Climate and Development Reports. Countries are tapping into our development knowledge to gain expertise, especially in strengthening the enabling environment for private sector investment and supporting smart development in their communities and local businesses.

We have significantly expanded our crisis toolkit in several ways: broadening the scope of our Climate Resilient Debt Clauses to now cover disasters such as droughts, floods, and pandemics, offering vulnerable countries much-needed financial flexibility during crises.

Adaptation examples:

In Haiti, the World Bank helped 400,000 people access health facilities and markets, by rebuilding 475 kilometers of rural roads and eight critical bridges.

The World Bank is supporting weather-resilient housing in Sindh Province of Pakistan, following the 2022 floods. Around 1,050,000 families received funding for the construction of weather-resistant homes. This generated an estimated 450,000 direct jobs and an additional 650,000 jobs in the construction supply chain.

In partnership with CGIAR, the World Bank reached five million smallholder farmers across Africa with agricultural technologies and services. In Mali, 150,000 farmers increased their income thanks to an app called RiceAdvice, which contributed to the adoption of drought-tolerant rice varieties.

Utilities for Climate (U4C), a program created by IFC, helps water utilities develop and implement innovative solutions to increase commercial investments in water infrastructure and improve resilience.

MIGA partnered with Societe Generale, HSBC, and the West African Development Bank to channel €506 million in guarantees toward projects that strengthen resilience against climate risks in eight countries: Benin, Burkina Faso, Côte d’Ivoire, Guinea-Bissau, Mali, Niger, Senegal, and Togo.

Mitigation examples:

The World Bank Group is investing in Bus Rapid Transit systems to reduce air pollution and improve commutes for millions of workers, in cities including Maputo, Dakar, Abidjan, and others.

The World Bank is supporting cities in Egypt, Pakistan, and Türkiye to improve waste management, including improved collection and sorting systems, improved waste transportation and treatment, and upgraded landfills.

The World Bank is supporting rice producers such as Viet Nam, to repurpose policies and invest in systems that reduce emissions and save water while improving yields.

IFC is working with financiers, governments, developers, and building owners to scale up development of green buildings in emerging markets. IFC’s EDGE is helping developers design low-emission, cost-efficient homes, hotels, office and retail spaces, warehouses, data centers, and transport hubs in over 10,000 projects across 120 countries.

In Mexico, MIGA, and HSBC partnered on a $1.85 billion guarantee, MIGA’s largest to date, to scale up sustainable finance across the country. The guarantee targets projects in renewable energy, energy efficiency, clean transportation, and sustainable agriculture.

We are working with over 30 countries in establishing domestic carbon pricing mechanisms and preparing for the next generation of international carbon markets. We are also helping countries to design and implement large scale programs that generate high integrity carbon credits in the forests and other sectors.

As part of a blueprint for methane reduction, through the  Global Methane Reduction Platform For Development (CH4D) platform we are supporting 35 country-led programs to deliver better rice production, livestock operations and waste management systems to improve livelihoods while reducing methane.

Climate IBRD/IDA trust funds

Umbrella Programs

• The Partnership for Market Implementation (PMI)

Helps countries build the systems needed for carbon pricing and carbon markets to function effectively. PMI supports policy design, institutional capacity, market infrastructure, and international cooperation, with a focus on practical implementation.

• Climate Support Facility

Provides tailored technical assistance and knowledge support to help countries develop long-term strategies, strengthen Nationally Determined Contributions (NDCs), and design investment pathways aligned with their climate and development goals.

• Scaling Climate Action by Lowering Emissions (SCALE)

Supports participating countries to leverage World Bank projects with high-emissions reductions potential to mobilize debt-neutral financing from international carbon markets for their low-emission and resilient development.

Trust Funds

• Canada-World Bank Clean Energy and Forests Climate Facility

Provides concessional financing to support clean energy, energy efficiency, forest conservation, and climate-smart land use through World Bank projects, with a focus on Asia, Small Island Developing States, and gender equality.

• Forest Carbon Partnership Facility (FCPF)

Supports countries to reduce emissions from deforestation and forest degradation (REDD+), strengthen forest governance, and access results-based payments for high-integrity verified emission reductions, including through carbon markets.

• BioCarbon Fund Initiative for Sustainable Forest Landscapes (ISFL)

Promotes sustainable land use by supporting integrated programs across agriculture, forestry, and other land-based sectors, helping countries reduce emissions and generate high-integrity emission reductions that can access results-based finance and carbon markets. ISFL operates in five countries.

• Transformative Carbon Asset Facility (TCAF)

TCAF pilots innovative approaches to carbon crediting at the policy and sector level. It supports countries in designing scalable, high-integrity crediting instruments and in unlocking new finance through programs like policy-based crediting.

• Carbon Initiative for Development (Ci-Dev)

Expands energy access in low-income countries by financing clean energy programs that deliver measurable emissions reductions, using carbon credits as a results-based financing mechanism, with a focus on off-grid energy, clean cooking, and climate-smart agriculture.

• Enabling Access to Benefits while Lowering Emissions (EnABLE)

Provides targeted grant support to strengthen social inclusion and benefit-sharing within World Bank–supported results-based climate finance programs, with a focus on Indigenous Peoples, local communities, and women.

• Kyoto Funds

This archive site provides historical information on the World Bank’s Kyoto Funds—including the Prototype Carbon Fund and BioCarbon Fund—which were early climate finance instruments established under the Kyoto Protocol. These funds supported initial mitigation projects and helped lay the foundations for carbon markets and results-based climate finance.

Climate Contact

Hannah McDonald-Moniz
hmcdonaldmoniz@worldbank.org