Climate Aid Is More Than Just Money

Mikey Glover | Climate and Environment Fellow

Image sourced by Philip Oroni from Unsplash.

There is a proverb about giving someone a fish versus teaching them how to fish. As the green transition accelerates in developed countries, those without the means to integrate or innovate new technologies are being left behind. Although the multilateral climate apparatus promotes finance and technology transfer to developing economies, effective adoption is contingent on having a suitable enabling environment. To achieve economic development and climate objectives, international development cooperation must support developing economies in building the technical expertise and institutional capacity sufficient to adopt new climate technologies.

Who Has All the Fish?

Crucial to the green transition are technologies aimed at climate change mitigation (reducing greenhouse gas emissions; e.g. renewable energy) and adaptation (building resilience against its consequences; e.g. drought-resistant crops). While developed countries are leveraging wealth and advanced capabilities to innovate such technologies and build low-emission and climate-resilient economies, developing economies are instead pursuing earlier stages of development with relatively weaker institutional and technical capacity.

Multilateral climate treaties–notably the United Nations Framework Convention on Climate Change (1992) (UNFCCC) Article 4 and the Paris Agreement (2015) Article 10– aim to address this disparity. They provide for the flow of climate finance and technology from developed to developing countries to reduce deficits and promote national economic development and global sustainability, facilitated by institutions such as the Green Climate Fund and Technology Mechanism. However, cross-border transfer generally occurs through market mechanisms, and is limited to those with sufficient capital and governance. As a result, most climate technology is circulated within advanced economies, with low diffusion to developing countries.

The issue is that limited access and deployment of finance and technology in developing economies exacerbates technological and capacity gaps, and restricts endogenous (local) production of climate technologies. Fewer clean and efficient technologies then impacts productivity and economic growth, perpetuating the cycle. It also delays mitigation and undermines adaptation efforts, constraining broader global sustainability. Moreover, despite cumulative and per capita emissions being disproportionally higher from high-income countries, developing countries with larger adaptation deficits are more exposed to climate change consequences.

More Than Just Donating Fish

So, why do developing economies struggle to adopt new climate technologies? The perennial problem in development is a lack of funding. Climate finance has increased holistically, with developed economies committing to raise $100 billion per year by 2025 in new funding, and substantial investment in mitigation (mostly in renewable energy and electric transport) spurred by commercial returns incentivising private sector engagement. However, adaptation needs–which tend to instead be public goods, such as flood protections–are estimated at 12x the current international public finance flows, which have declined amidst global economic pressures.

Yet, as suggested by the now-floundering fish metaphor, money is only half the picture. The other half is the know-how that money unlocks. Under the UNFCCC ‘Technology Needs Assessment’ (TNA) process, over 140 developing countries either have or are identifying climate technology priorities and barriers. Most prioritised technologies are commercially-proven (‘traditional’ or ‘modern’), such as solar photovoltaics for mitigation or irrigation systems for adaptation, rather than emerging (‘high’) technology. Importantly, the barriers centre on integration capacity.

Teaching To Fish

Given the role of structural constraints in bottlenecking climate technology deployment, international development cooperation needs to be approached holistically and in alignment with local priorities within TNAs. While this certainly includes climate technology hardware transfer and dedicated funding, it also requires strengthening developing economies’ capacity to adopt it by providing technical assistance and building institutional knowledge through international partnerships.

Financial governance is critical. Projects like large-scale renewable energy build-outs can need significant upfront resources and decades-long investment, requiring private capital. However, developing countries lack the government incentives and strong capital markets of developed countries that can support nascent technology. The cost of capital from undeveloped financial institutions can undermine investment viability and constrain deployment. Support can include assistance with mobilising lower-cost finance (such as through concessional loans), or catalysing private sector capital through financial vehicles structured to manage investment risks (such as blended finance arrangements and joint public-private ventures).

Equally significant is technical literacy. A country’s research institutions and industry must understand which new technologies to deploy to local conditions, and how to unlock endogenous development. Similarly, policy support with national governance institutions can create fit-for-purpose industrial policy, innovation programs, and regulatory frameworks, such as green building codes or intellectual property law. Technology transfer primarily occurs through commercial licensing, where developed countries’ private sectors allow production of their technologies by a local firm. This requires robust intellectual property protection (IP) law, which encourages sharing proprietary technologies by giving confidence that commercial return-on-investment will be protected. In fact, the absence of IP law enforcement is one of the most significant impediments of climate technology transfer to developing economies.

The goal is to ultimately promote sustainable technology transfer, where developing economies can adapt, deploy, reproduce, and improve upon climate technology. Accelerating climate technology adoption is central to economic growth and to global climate change mitigation and adaptation progress. Alongside ongoing financial support and physical hardware, building local governance capacity is just as important: technical know-how, institutional infrastructure, and policy arrangements. This will support developing economies to meaningfully integrate prioritised mature technologies and adopt frontier technology in the future. As the proverb goes; Give someone a fish, and you feed them for a day. Teach a country’s governance institutions to integrate and develop new climate technologies, and you support its sustainable economic development for a lifetime.

Mikey is a recent graduate of the University of Sydney with a Bachelor of Laws and Bachelor of Science. He has a strong interest in climate governance, international environmental law, and Australia’s role in shaping cooperative responses to transnational environmental challenges. 

His academic work has focused on international environmental frameworks, including plastics regulation, water governance, and global climate litigation. As a research assistant with the Australian Centre for Climate and Environmental Law, he investigated how legal and non-legal mechanisms can protect and restore natural ecosystems. 

Mikey also studied in Shanghai at the East China University of Political Science and Law, deepening his interest in China’s climate transition and the implications for Australia–China environmental cooperation. 

Through this fellowship, Mikey hopes to further explore how environmental diplomacy and governance can support a resilient, sustainable, and equitable Asia-Pacific.

Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect those of Young Australians in International Affairs. All content is original, and no plagiarism has been used in the preparation of this article. AI tools were used for organising initial ideas.