The 2023 United Nations Climate Change Conference or 28th Conference of the Parties to the UNFCCC (COP28) has made significant progress on the crucial issue of climate finance. Developing countries have long demanded financial support to address the damages and losses inflicted by climate change on their territories and populations. Despite pledges from developed nations, these funds have yet to be fully realised.

The current climate crisis necessitates substantial funding to implement mitigation and adaptation plans, alongside compensation for the most vulnerable nations. As emphasised by UNFCCC Executive Secretary Simon Stiell, "Finance must be the basis for scaling up climate action on all fronts".

The UAE not only successfully operationalised the Loss and Damage fund, initially left pending at COP27 in Sharm Al Sheikh, but also mobilised over $83 billion in climate finance, setting the stage for a new era in climate action.

Key developments in climate finance at COP28 include:

- Loss and Damage Fund: Nearly $800 million has been raised for the fund, with major contributions from the United Arab Emirates, France, Italy, Germany, the United Kingdom, and the European Union.

- Climate-Resilient Debt Clauses: International financial institutions and countries committed to offering climate-resilient debt clauses in loans, allowing debt repayment to be paused in the case of natural disasters. The World Bank pledged a two-year suspension of debt and interest in such instances.

- Green Climate Fund Replenishment: $3.5 billion in new funding was pledged for the Green Climate Fund.

- Adaptation and Development Funds: $134 million was allocated to the Adaptation Fund, $129.3 million to the Least Developed Countries Fund, and $31 million to the Special Climate Change Fund.

- Catalytic Fund: UAE launched a $30 billion catalytic fund called ALTÉRRA, aiming to mobilise an additional $250 billion globally for climate action.

- The UAE pledged $200 million to support vulnerable countries through Special Drawing Rights and $150 million to fund water scarcity solutions.

- The World Bank announced a $9 billion annual increase for 2024 and 2025 to finance climate-related projects.

- Multilateral Development Banks (MDBs) committed to a cumulative increase of over $22.6 billion towards climate action.

With just hours remaining in COP28, the summit has brought nations together and yielded a series of commitments on climate finance. These pledges, once fulfilled, can propel the world towards a more sustainable future.