Climate Finance, Philanthrocapitalism, and Nigeria’s London Pitch

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Trends and Threads

^{By Tauni Lanier} 

Nigeria did everything the playbook asked. It still had to fly to London during London Climate Action Week to be graded. A case study in why the successor to failed aid and venture philanthropy is repeating their central mistake.

London Climate Action Week (LCAW) has come to an end. With more than 1000 events planned during the week, it was impossible to keep abreast of everything and every announcement. The week after LCAW keeps one busy, reading impressions, announcements, and criticisms.

Global South and the Development Paradox: Three waves of external capital have tried, and failed, to develop the Global South: bilateral and multilateral aid, then venture philanthropy, then Chinese infrastructure lending. Earlier instalments of this series argued they failed for the same reason — each treated development as a capital-deficit problem when it was a governance and institutional-capacity problem. A fourth wave has now arrived. It is called climate finance, and it is being sold explicitly as the successor to all three: more rigorous than aid, more scalable than philanthropy, less geopolitical than Beijing. I spent LCAW inside its engine room moderating a Nigerian carbon-market panel at Mansion House and keynoting a summit on whether distributed-solar attributes can become procurement-grade instruments in sub-Saharan Africa. This piece uses Nigeria as the case study, because Nigeria is the closest thing the fourth wave has to a model student.

The collapse of aid and the retreat of philanthropy have cleared the field. Climate finance now carries the “innovation” narrative that venture philanthropy or philanthrocapitalism carried fifteen years ago, covering market discipline, measurable outcomes, business rigour, and private scale. New instruments are bringing some of the same structural errors. The conditionality that moved from policy (the IMF) to agenda (the foundations) is now migrating a third time, into market infrastructure: ratings, standards, verification, “bankability.” And the concessional money private capital needs to move is disappearing at exactly the moment everyone is told to mobilise it. And market infrastructure continues to be based on mainly lessons learned from the North American and European arenas. Climate finance is not failing because it is the wrong idea. It is at risk of failing because the people building it are conflating moving capital with reducing the hazard and because we are still trying to import what can only be built. Climate Finance must be built for regions by regional actors.

Understanding the Vacuum: The numbers describe not a gap but a vacuum. Development assistance from OECD donors fell 6 percent in 2024 to USD 214.6 billion, the first decline in six years. Then came the cliff: preliminary 2025 figures show ODA fell to USD 174.3 billion, a 23.1 percent contraction, the largest single-year fall on record, with a further 5.8 percent drop projected for 2026. The United States, which provided USD 63.3 billion in 2024, about 30 percent of all global aid (USAID’s own budget request that year was roughly USD 32 billion), has led the retreat. Thirty per cent of the world’s aid, withdrawn at speed, is enough to leave a continent-sized hole. The philanthropic backstop is going the same way. Warren Buffett, whose Berkshire shares underwrote the modern Gates Foundation, resigned its board in 2021 and has confirmed the Foundation receives nothing from his estate; the Gates Foundation itself plans to wind down entirely by 2045. The era of the permanent, growing mega-donor is not threatened. It is scheduled to close. Underneath both sits the debt machine that never stopped. Global public debt hit a record USD 102 trillion in 2024; developing countries’ net interest payments reached USD 921 billion, up 10 percent in a year. Sixty-one developing countries now spend 10 percent or more of government revenue servicing interest, and 3.4 billion people live in countries that spend more on debt interest than on health or education in Africa, roughly 751 million people, some 57 percent of the continent. Aid in its steepest recorded decline, philanthropy announcing its own sunset, debt service crowding out the health and education budgets that build the institutions development requires.

The official response arrived three days before London Climate Action Week. At their summit in Évian on 15–17 June 2026, the G7, who between them provide some 70 percent of global ODA issued a Leaders’ Declaration on Mutually Beneficial International Partnerships, “recommitting” to development finance. Read closely, it is not a recommitment to aid; it openly concedes that ODA “is insufficient to meet developing countries’ needs,” then pivots to something else: mobilising private capital “at scale,” helping partner countries “self-finance,” strengthening domestic tax collection, and using concessional resources “strategically where they are most needed,” rationed to the least-developed and shock-vulnerable. It is, in other words, a recommitment to the fourth-wave model of private mobilisation, blended finance, and self-reliance issued by the same governments whose aid just fell 23 percent. To be clear, the cutters are assuring the world the cut will be fine. There is something real in it: a sharper focus on debt vulnerability, on economic sovereignty and country ownership, on reforming a fragmented development architecture. Nigeria will test each one. But notice what the official answer to the vacuum is: not to refill it. But to tell the countries standing in it to go and attract the private capital that will. Into that vacuum walks the fourth wave, and Nigeria walks in to meet it.

Nigeria has done everything right: Every wave needs a story, and every story begins where the last one’s credibility ended. The IMF said: give us policy control and capital will work. The foundations said: give us metrics and grants will work. China said: give us infrastructure and trade will work. Climate finance says something more seductive: you don’t need our charity; you have assets we will pay a market price for. Nigeria’s pitch in London was exactly this, and it deserves to be taken seriously because Nigeria has done the hard part. The country now has a genuine sovereign climate architecture: the Climate Change Act 2021, the National Council on Climate Change, NDC 3.0, the Electricity Act 2023 that unbundled the power sector and opened mini- and off-grid investment, a National Carbon Market Activation Policy projecting up to USD 2.5 billion a year in carbon revenue by 2030, and membership of the African Carbon Markets Initiative. The Nigeria Climate Investment Summit’s own framing names the task precisely: “catalysing climate policy progress into financial flows for green projects.” The policy progress is real. The financial flows are the open question. Here is what the case study exposes. Nigeria built the institutions that I have argued are the only durable path yet, still had to fly to Mansion House to be assessed. Not by the IMF. Not by a foundation. By the City of London’s Transition Finance Council, by ratings agencies, by carbon-standard bodies, by integrity raters. The summit even introduced a new instrument for this, the Sustainability Policy & Practice Spotlight, a framework profiling the ESG performance of corporate Nigeria to demonstrate “readiness” to foreign capital. The country that did the sovereign, institution-building work still cannot convert it into capital without the blessing of private infrastructure it does not own and cannot vote on. Conditionality has migrated a third time, from policy to agenda to market plumbing. The IMF’s conditionality was explicit (privatise, liberalise) and therefore contestable. The foundation was implicit (fund this disease, hit these metrics) and harder to argue with. The new conditionality is encoded in what counts as “bankable,” “investment-grade,” “procurement-ready,” “high-integrity.” You can argue with a finance minister; you cannot negotiate with a methodology. And the bodies that write the methodologies, such as Verra, Gold Standard, the index providers, the rating houses, answer to no electorate and, unlike even a foundation, carry no public mission. At each step the conditionality became less visible and more total.

Nature as Underpriced Assets: On my panel at the Nigeria Climate Investment Summit (NCIS), the framing that nature is “Nigeria’s underpriced asset” – its 9–11.1 million hectares of forest reframed as a carbon “goldmine” and offered, sincerely, as the route to capital. It is. It is also the oldest extraction logic in the book, wearing green. Monetising natural capital for Global North buyers risks rebuilding the resource-extraction model that oil already ran in Nigeria. When a low-emitting country sells carbon credits so that high-emitting buyers can keep emitting and still claim net zero, the value tends to pool where it always has, with intermediaries, verifiers, brokers and offset purchasers, while “beneficiation of asset-bearing communities,” to use the phrase from the sovereign-wealth seat on my panel, arrives last, if at all. Nigeria has watched this film before six decades of oil, much of it exported as raw value, with the Niger Delta carrying the externalities. A carbon market built on the same architecture would be the same story in a lower-carbon font. We do not have to speculate about whether the social layer gets delivered. We have the data. Reviewing 29 sovereign and development-bank sustainable-finance frameworks, the Just Transition Finance Lab found that of roughly 630 references to climate, social or community issues, only about six explicitly mention “just transition.” In the COP29 estimate of what developing countries need, about USD 2.4 trillion a year by 2030, the slice allocated to a just transition is roughly USD 40 billion, under 2 percent. The green economy could create 24 million jobs by 2030 even as coal phase-out alone displaces up to 17 million workers, ~80 percent concentrated in a handful of regions. The social dimension is not contested. It is simply unpriced, and what is unpriced does not get delivered.

The Grid that Proves the Point: If you want to see the whole problem in one number, look at Nigeria’s grid. The country has roughly 13 gigawatts of installed generation capacity. It typically delivers 4,000 to 5,500 megawatts to the grid, often a third of what is installed, for a population of more than 200 million people across 774 Local Government Areas. The capacity exists. The conversion fails, strangled by gas supply, transmission and distribution bottlenecks. Built, but not converted. That is the grid, and it is also the exact shape of the climate-finance problem: the institutions are built, but the capital does not convert. This is where the second summit I sat in matters. The distributed-solar convening I keynoted was, in effect, about routing around the broken grid, turning environmental attributes from distributed solar into procurement-grade mitigation instruments that corporate and institutional capital can buy at scale. It sits inside a much larger push: Mission 300, the World Bank and African Development Bank programme to connect 300 million Africans to electricity by 2030 (250 million via the World Bank, 50 million via the AfDB), against the roughly 600 million Africans who lack power today, 83 percent of the global access deficit. About half of those connections are expected to come not from the grid at all, but from off-grid solar, mini-grids and solar home systems. Two things follow, and the summit named both. First, distributed solar only becomes investable if there is a verification and integrity layer, continuous monitoring (MRV), registries, and defensible attributes sturdy enough for institutional buyers. Second, even then, it does not move without catalytic first-loss capital to take the early risk. The organising question of the day was blunt: “What conditions move first capital?” The answer the room kept circling was concessional, patient, “public-ish” money, the exact layer that is now collapsing. Nigeria’s own climate-finance lead put it as moving “from market signal to market infrastructure.” That is the right phrase. It is also the admission that the market does not yet exist; it must be built, and building it requires the catalytic capital the aid collapse is removing.

The Escapism of Climate Risk: The sharpest idea I encountered all week was at neither summit. It was in a Columbia CCSI paper published days earlier, and it quietly dismantles the framing of both. “Climate risk,” the authors argue, is routinely treated as one thing when it is three: the planetary hazard itself, the economic damage it can cause, and the financial loss that may follow. Transmission between the layers is partial and delayed, so much of the hazard never registers as financial cost inside the horizons that govern investment. They then separate six policy responses: mitigation, resilience, risk-sharing, fiscal resilience, exposure management, and financial-system stability, and make one devastating observation: only mitigation reduces the underlying hazard. The other five manage its consequences. Apply that lens to a climate-investment summit and the room changes colour. The sector systematically conflates mobilising flows with reducing the hazard, and much of its activity is, in CCSI’s phrase, the “busy work of measuring, disclosing and reporting information that is not decision-useful.” The ESG scores, the readiness spotlights (Nigeria’s SPPS among them), the disclosure frameworks, the integrity ratings- much of this is necessary for market access and irrelevant to emissions, and it actively crowds out the one response that reduces the hazard. The conflation is comfortable precisely because it lets every actor claim climate progress – the issuer, the rater, the underwriter, the host government – while the atmosphere keeps no one’s scorecard.

Institutions are not Enough: Here the case study forces an argument with myself. The central claim of this series has been that external capital cannot build institutions, so development must be locally owned. Nigeria half-breaks the thesis. Nigeria did build the institutions. And it still cannot access affordable capital. Sovereign capacity, it turns out, lowers the cost of capital; it does not replace the capital, and on its own it does not move the price enough. The binding constraint is not capital-versus-institutions. It is the global risk-pricing architecture that systematically overprices Global South risk. A solar or forestry asset in Nigeria is not assessed on its own cash flows; it is dragged down by a sovereign ceiling and a ratings methodology built for a different century. CCSI’s companion work on sovereign risk ceilings argues that disaggregating risk, separating the project from the sovereign, the genuine risk from the inherited premium, is the lever that determines “whether the transition can be financed at all.” The G7 at Évian named the goal exactly right, “long-term economic sovereignty,” the “ability to self-finance.” But it reached, once again, for the familiar lever: mobilise more private capital, improve tax collection. Neither touches the sovereign-risk premium that makes Nigeria’s capital expensive in the first place. You cannot self-finance your way out of a mispricing; you must dismantle it. The answer to Nigeria’s question is therefore not only to build institutions. It is to build institutions and dismantle the mispricing that punishes you for being where you are. This suggests a new pricing structure.

Dr. Tauni Lanier, Sustainable Finance Architect and Climate Finance Thought Leader, published this piece on Substack

Spotlight

As Sam Onuigbo Mounts the Saddle of GLOBE International

It is impossible to discuss Nigeria’s climate change policy ecosystem without copious mention of the Climate Change Act of 2021. And that invariably means the name Sam Onuigbo, sponsor of the law, remains etched in the annals of the country’s foundational efforts to tackle the world’s overarching existential challenge. Those who know can readily testify to the tenacity of conviction and unyielding persistence that drove him to dismantle formidable hurdles against passage of the climate change bill. Those hurdles spanned two consecutive assemblies and several minefields of politics, bureaucracy, and elite conspiracies. His memoirs, should he choose to write one, would be very revealing indeed.

However, what is now revealed and re-echoing across the globe is Onuigbo’s emergence as President of GLOBE Legislators (Global Legislators for a Balanced Environment), the first platform for parliamentary engagement championing climate action at the United Nations (UN) and the first ever Focal Point for the UN Framework Convention on Climate Change (UNFCCC). It is a clear case of a gold fish having no hiding place.

He was inaugurated at a high-profile event at the UK Parliament last month during the 35th anniversary celebration of GLOBE, themed ‘building political resilience and public consensus for climate action.’ According to the organisers, “for 35 years, GLOBE has been at the forefront of driving parliamentary action on climate change and sustainable development across party lines.” Onuigbo’s inauguration marks “a new chapter for GLOBE to reforge cross-party consensus for urgent action on climate change” and a renewed commitment to “ensuring that parliamentarians are the centre of democratic debate on climate change and play their role in driving forward implementation in this new era of climate action.” The event, held during this year’s London Climate Action Week (LCAW), was graced by Members of Parliament (MPs) from across the world, including Deputy Speaker of Nigeria’s House of Representatives, Rt. Hon. Benjamin Kalu. There were keynote video messages from Hon. Al Gore, co-founder and former Chair of GLOBE Legislators, and Yuriko Koike, Governor of Tokyo, former GLOBE Legislators’ Board Member, and President of GLOBE Japan. Other speakers included Nigar Arpadarai MP, COP29 High-level Champion; Member of Parliament of Azerbaijan; Kamal Kishore, Special Representative of the UN Secretary General & Head of UNDRR; Nick Mabey OBE, Founder & Chair of London Climate Action Week; Co-founder & CEO of E3G; Paolo Vieira, Global Director, NDC Partnership, and GLOBE’s immediate past CEO, Malini Mehra.

The team at SOStainability warmly associates with this global milestone and wishes the Right Honourable Sam Ifeanyichukwu Onuigbo, FCIS, FNIM, KJW, a successful tenure.

Flakes and Flaks

Natasha’s Seeds of Tomorrow’s Trees

Senator representing Kogi Central in Nigeria’s National Assembly, Natasha Akpoti-Uduaghan, sure knows how to steal the show. At a time when it is fashionable to distribute rice to constituents, this delectable politician chose to add some green ingredients to her constituency empowerment scheme. A statement from her office this week announced the “Growing Kogi Central, Building Our Future” project, which seeks to “restore degraded land, curb soil erosion, improve biodiversity, strengthen food security and create economic opportunities through the cultivation of fruit and indigenous tree species.” According to her office, the programme would involve “planting mango, guava, orange, moringa, neem and other indigenous trees valued for their environmental, nutritional, medicinal and commercial benefits.” While rice, tomatoes, and vegetable oil would appear to suffice for today, the planting of trees, economic species for that matter, would serve to feed tomorrow’s generations. This page, however, hopes that this is not a move to ‘greenwash’ Natasha’s tumultuous political career.

SOS ALert

“From our records, we are expecting about 18 million Nigerians to be exposed to flooding in 2026. Over 2,000 hectares of farmlands will be affected. 8,794 educational facilities will be affected, and healthcare centres 3,808.”

• Nigeria Hydrological Services Agency (NiHSA)