US delays $2.6 billion climate finance package to South Africa

WASHINGTON: The United States (US) is delaying the disbursement of $2.6 billion in climate finance to South Africa, raising concerns the funds could be withheld entirely, Bloomberg News reported on Thursday, citing people familiar with the situation.

Earlier this month, US representatives prevented the World Bank-linked Climate Investment Funds (CIF) from approving a $500 million disbursement to South Africa, the report said.

The funding was expected to unlock an additional $2.1 billion from multilateral development banks and other financial sources, and a fresh attempt to approve the disbursement may be made at CIF meetings in June, the report said.

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The US Treasury declined to comment on the report and the CIF did not respond to a Reuters request for a comment.

CIF is one of the world’s largest multilateral funds aimed at scaling climate solutions in developing countries.

If confirmed, the move would be among several actions by President Donald Trump’s administration to scale back participation in multilateral climate initiatives.

In March, the US withdrew from the board of the United Nations’ climate damage fund, which supports vulnerable nations facing climate-related disasters.