Leaders of the G7 nations meeting in Rome have agreed to establish a $500 billion annual climate finance mechanism for developing nations — the largest commitment in the history of international climate negotiations — with 35% of funds earmarked specifically for African energy transition projects.

The agreement, reached after four days of intensive negotiation, represents a significant expansion of previous commitments and addresses longstanding criticism that wealthy nations have failed to honour climate finance pledges made at successive COP summits.

What the fund covers

The facility will support renewable energy installation, climate adaptation infrastructure, agricultural resilience programmes and forest conservation. For Africa, this translates to approximately $175 billion per year — more than double the continent's current total climate finance receipts from all sources.

World Bank President Ajay Banga, who attended as an observer, said his institution would act as the primary implementation vehicle and would begin disbursements from January 2027. A new governance board with equal representation from G7 and recipient nations will oversee allocation decisions.

"Africa has contributed the least to climate change and suffers the most from it. This agreement begins — begins — to address that injustice." — African Union Commission Chair Moussa Faki Mahamat