Europe and North America experienced consecutive heatwaves this summer, highlighting the growing costs associated with climate change. Impacts including drought-stricken agricultural lands, strained energy infrastructure, reduced workforce productivity, and rising insurance claims have underscored the urgent need to address global warming. Scientific assessments increasingly suggest that the planet is heating more rapidly than previously projected, intensifying the imperative for adaptation measures worldwide.

Emerging markets and developing economies face particularly daunting challenges in responding to climate change. These regions are home to the majority of the global population and all expected population growth, yet they often lack sufficient domestic financial resources to fund the necessary investments for climate adaptation and mitigation. At the same time, these countries are among the most vulnerable to the adverse effects of rising temperatures, which include crop failures, water shortages, and potential mass migrations.

Current development patterns raise concerns about emissions trajectories. Without significant change, the share of global greenhouse gas emissions originating from emerging and developing economies is projected to increase from approximately 42 percent today to 53 percent by 2050. Such a trend would severely complicate efforts to meet international climate targets.

To bridge the financing gap, attention is increasingly focused on external support. The "Baku-to-Belem" roadmap, established through United Nations climate negotiations, estimates that emerging and developing economies will require roughly $1.3 trillion annually in external financing by 2035, beyond what they can generate domestically. This figure, already challenging prior to recent global interest rate hikes, now appears even harder to achieve.

Adding to the complexity is growing investor skepticism regarding the long-term sustainability of public finances in wealthy countries. Many advanced economies have seen their public debt rise significantly over the past two decades, with current levels around 110 percent of GDP compared to less than 70 percent at the start of the century. Fiscal pressures are expected to intensify due to aging populations and competing demands, including investments related to artificial intelligence. This dynamic is increasing the difficulty of mobilizing climate finance precisely when it is most needed.

The upcoming UN climate summit, COP31 scheduled to take place in Antalya, faces heightened expectations to advance financing solutions. Several mechanisms are under consideration to mobilize funds, including the implementation of carbon taxes, which could generate revenue while curbing emissions. Proposals also include targeted allocations of International Monetary Fund special drawing rights to direct liquidity towards climate-related projects. Some experts have suggested introducing “solidarity levies” on globalized sectors such as shipping, aviation, and financial transactions. Another avenue involves securitizing future official development assistance to secure upfront funding for urgent mitigation efforts.

While no single approach offers a complete solution, a combination of these measures could form an effective financing package. Achieving the $1.3 trillion annual funding goal remains an ambitious but crucial target. The alternative to acting now, experts warn, is delayed responses that will incur far greater societal and economic costs, including increased disaster relief, reconstruction needs, food insecurity, and displacement.

This summer’s extreme heatwaves serve as a stark reminder of the high stakes. Stabilizing the climate demands substantial investment; the choice faced by global leaders is not whether to pay but when — sooner actions can reduce far greater expenses in the future.