World Bank Drops Climate Finance Target Under U.S. Pressure

The World Bank Group announced that it will extend its Climate Change Action Plan, its strategy to support countries and private sector clients to address climate and development challenges together, but that it will also retire a key target committing 45% of its financing to projects with climate co-benefits.

The World Bank’s climate finance activity has increased significantly since launching its climate strategy 5 years ago. The move to retire the climate finance targets follows pressure from the Trump administration, which has argued that the goal distorts the organization from its mission to reduce poverty and drive economic growth. The U.S. is the largest shareholder in the World Bank Group.

The World Bank set a target in late 2020 for 35% of its financing to have climate co-benefits over the subsequent 5 years, with 50% to be channeled towards adaptation and resilience. The goal was increased to 45% in 2023 for the remainder of the 5-year period. In June 2021, the organization launched its 5-year Climate Change Action Plan with a commitment to increase delivery to an average of 35% of total World Bank Group financing for climate, and broadening focus from its prior plan from investing in green projects to helping countries integrate their climate and development goals.

Over the subsequent 5 years, the World Bank’s climate finance activity has increased substantially, reaching over $39 billion in 2025, more than double 2020’s $17 billion, including $16.6 billion for adaptation and $22.6 billion for mitigation. 2025 also marked the first year that the group surpassed its 45% co-benefits target, hitting 48% for the year.

Under the Trump administration, however, the U.S. government has pressured the World Bank to drop its climate finance target. In April 2026, U.S. Treasury Secretary Scott Bessent argued that “The World Bank must maintain focus on its core mission of reducing poverty and increasing economic growth,” adding that this “means jettisoning the World Bank Group’s 45% climate finance target that breeds inefficiency, distorts economic decision making, and moves the Bank away from its core mission.”

President Trump, who recently referred to climate change as “the greatest con job ever perpetrated on the world,” has worked actively in his second term to undo the climate-focused actions of prior administrations, starting with an Executive Order on his first day in office to once again withdraw from the Paris Agreement.

Despite retiring the climate finance goal, the World Bank said that its “work on climate is and will remain firmly client driven, supporting them in delivering on their own ambitions as set out in their national plans and Nationally Determined Contributions (NDCs).”