U.S. Withholds Funds from AfDB Amid Climate Change Focus

The U.S. Treasury has withheld financial contributions to the African Development Bank's fund for low-income countries, citing a disproportionate focus on climate change. This development has left a significant funding gap that the AfDB is scrambling to fill through alternative measures, including increasing contributions from African member states.

The AfDB had initially aimed to raise $25 billion, but the absence of a U.S. pledge has created an urgent need for additional financial support. During a December conference, African nations pledged contributions for the first time, and Western nations like Denmark and Norway also increased their support.

The bank plans to raise $1 billion through market borrowing to mitigate the shortfall. Meanwhile, the Trump administration's withdrawal from international climate initiatives has impacted funding for various development projects across Africa, exacerbating the situation further.