A major UN-hosted conference on development finance could help raise funds to support the green transition despite attempts by US president Donald Trump to scupper the process, activists say.
The Fourth International Conference on Financing for Development, which is held once every decade, takes place in Seville, Spain from 30 June to 3 July. It brings together governments, international organisations, civil society and business to discuss how to fund development, climate and nature goals.
The US is reportedly pushing to dilute the outcome of the meeting by removing references to climate, gender equality and sustainability so progress will depend on whether European countries, developing nations and other allies can unite and push back.
“Governments have a rare chance to rewrite the unfair and outdated global economic rules that are prolonging the fossil fuel era and putting record numbers of countries and households into crippling debt,” said Bronwen Tucker, a researcher from Oil Change International.
The draft outcome document includes proposals on debt reform, international taxation and aid flows, as well as calls to overhaul the global financial architecture.
“We will take urgent actions to adapt to and build resilience against climate impacts, improve access to climate finance, provide new and additional financial resources and facilitate the transfer of technology to address the global climate change challenge,” the draft says.
“With a focus on financial stability, we will consider expanding financial regulation and supervision to incorporate climate transition plans and climate stress testing.”
On the sidelines of the conference, Brazil is expected to convene a meeting of finance ministers who are seeking action on climate finance ahead of the Cop30 summit which the country is hosting in November.
The Cop29 summit last year concluded on a sour note after a contentious US$300bn annual climate finance deal passed despite objections from global south representatives. This figure, to be provided by 2035, falls short of the $1.3tn experts deem necessary for effective climate action in developing economies.
The final Cop29 agreement relies primarily on expanding loans and private capital, without a guaranteed grant-based component. This is despite calls from global south negotiators for substantial grant financing to avoid burdening the region with more debt.
Rebecca Thissen, global advocacy lead at CAN International, said she hopes the Seville meeting agrees to establish a process to forgive the debt that is stalling the green transition.
“Seville can be, and should be, the place where states agree on a strong outcome to transform our current financial and economic systems, starting by the adoption of a UN convention on sovereign debt,” she said.
Thissen said it was important to link the conversation about debt relief with discussions about climate finance, noting that 70% of funds is provided through loans.
“Some are concessional, some are at market rates but in any case a loan is a loan and has to be repaid so it’s increasing the debt burden on developing countries,” she said.
“The global financial system was built by – and continues to benefit – the rich countries that did the most to cause the climate crisis. Today, they are demanding loan repayments from those who contributed the least, while offering ‘climate finance’ largely in the form of new debt.”
Advocates have long sought to restructure global south debt and help vulnerable countries meet their climate commitment goals.
Researchers suggest that a workout mechanism to restructure $812bn worth of sovereign debt in the global south could help the region fight climate change. In 2023 alone, emerging and developing economies paid $385bn in debt service payments, limiting their ability to invest in green projects.
A new Vatican-backed report put together by prominent economists that calls for urgent action to address the global debt and development crises will also be discussed in Seville.
“The debt crisis is crowding out investments in health, education, and climate and is making the economic and social situation dramatic in many developing economies,” said Martín Guzmán, the former Argentina economy minister who was commissioned by the late Pope Francis to co-lead the report.
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