Asian Philanthropists Step Up to Fill the Global Climate Funding Gap

Asian philanthropic organizations are increasingly stepping in to fill a critical funding void in climate change mitigation and adaptation as the United States and European nations scale back their international aid commitments.

The shift comes as Asia faces disproportionate climate impacts, with the region warming at twice the global average. Since 2000, 3.7 billion people in Asia—three times the population of the rest of the world—have been affected by climate-related disasters.

Despite these risks, funding remains scarce. Less than 2% of global philanthropic giving is directed toward mitigating climate change, and of that amount, only 12% is allocated to Asia.

This funding gap has been widened by a retreat in Western aid. In July 2025, U.S. President Trump shuttered the U.S. Agency for International Development, an action that eliminated more than $40 billion in funding for climate-related development projects globally.

European nations have followed a similar trend of austerity. France reduced its development aid budget by 40%, while Germany reduced its international aid budget from 6 billion euros to 4.58 billion euros in 2025.

Jamie Choi, CEO of the Singapore-based Tara Climate Foundation, told Fortune that for a long time, climate leadership was expected to come from the West, but those days are now over.

As Western funding declines, Asian funders are positioned to plug the gap, with an estimated $5.8 trillion expected to change hands within the region before the end of the decade.

A 2026 report by the Center for Impact Investing and Practices (CIIP) found that among 165 surveyed Asian funders, nearly half were already investing in climate resilience and adaptation, and another 28% expressed readiness to begin investing.

However, the scale of the need remains immense. According to the CIIP, Asia requires more than $200 billion annually to finance climate adaptation and resilience, yet current flows are only approximately $19 billion.

By 2030, Asia is projected to account for 75% of the global climate financing gap. Regional firms are expected to bear $336 billion in annual climate mitigation costs.

Shaun Seow, head of the Philanthropy Asia Alliance (PAA), notes that climate causes are woefully underfunded compared to more immediate crises like disease outbreaks or child suffering, which tend to be more heart-tugging for donors.

Choi suggests that donor hesitation is also driven by knowledge gaps, as many perceive climate change as a complex technical or accounting problem.

To address the funding shortfall, Asian organizations are exploring new payment models, including blended finance, which combines public funds with private capital to support projects in emerging markets.

The Center for Asian Philanthropy and Society has suggested that philanthropic organizations provide funds as risk capital. This approach supports novel solutions that are too unproven for governments to fund, too risky for private investors, or too expensive for social innovators to bear alone.

Seow highlighted the Tahija Foundation in Indonesia as an example of patient philanthropic capital, noting that the foundation donated over $17 million over a decade to test the use of Wolbachia bacteria to control dengue fever.

The PAA, established in 2023 and backed by Singapore state investor Temasek, unites a network of global and Asian organizations, including the Tanoto Foundation, Dalio Philanthropies, and the Bill & Melinda Gates Foundation. The alliance currently supports more than 300 projects across inclusive development, health, and climate in Asia.

Other collaborative efforts include the Just Energy Transition Community (JETC), an alliance launched in 2025 to promote an inclusive energy transition. On May 18, 2026, the JETC announced an initial $2.6 million in catalytic funding for projects in Southeast Asia, focusing on cooling homes and ensuring clean energy access for fishermen and rural farmers.

Choi emphasized the importance of local leadership, noting that Asia emits 50% of global emissions and possesses homegrown solutions that require regional funding rather than decisions made in New York or London.

While some Western entities are retreating, others maintain a supportive, non-leading role. On May 20, 2026, the Nature Conservancy announced it would fund pilots for its Global Ocean Innovation Challenge in Indonesia’s Savu Sea starting in June 2026. Working with local partner Yayasan Konservasi Alam Nusantara, the project will use solar-powered acoustic listening stations and autonomous surface vessels to combat illegal fishing.

Jennifer Morris, CEO of the Nature Conservancy, stated that the organization does not wish to crowd out local organizations and will leave once its presence is no longer needed.

Seow believes the future of climate action will rely on cooperation between the Global South, specifically between Africa, South America, and Asia.

The conversation needs to happen between Asia, South America, and Africa. We owe it to ourselves: Global South for Global South.

Shaun Seow