Elsevier

Political Geography

Volume 99, November 2022, 102769
Political Geography

Full Length Article
The unequal geographies of climate finance: Climate injustice and dependency in the world system

https://doi.org/10.1016/j.polgeo.2022.102769Get rights and content

Abstract

Central to climate justice is the question of who will pay for the mitigation and adaptation efforts needed as the climate crisis worsens, particularly in countries that bear little responsibility for global greenhouse gas emissions. Climate finance is a complex set of mechanisms intended to address this concern. World-systems theory has long understood international development assistance as a tool that reproduces spatial dependency between states. In this paper, we ask whether climate finance follows the expectations of world-systems theory and reproduces relationships of dependency, or if it instead advances climate justice and challenges spatial dependency in the world-system. Through this analysis, we consider the implications of climate finance for world-systems theory. We use recent empirical data to ask whether climate finance follows or challenges world-systems theory expectations, focusing on five areas: (1) spatial flows of climate finance between the core, semi-periphery, and periphery; (2) the governance of climate finance institutions; (3) the types of projects supported by climate finance; (4) the relationship of projects to dominant systems of extraction, production, and consumption; and (5) the agency of peripheral state and non-state actors in shaping climate finance in relation to their interests. Taken together, we argue that climate finance in many ways reproduces relationships of dependency, though potential avenues exist for contesting this unequal balance of power and for advocating for climate justice. This case illustrates the need to approach analyses of dependency in a nuanced way, interrogating specific processes through which dependency is produced and contested across scales.

Introduction

“Climate justice is the simple idea that those who have done the most to cause the climate crisis – and who have the most resources – must also do the most to fix it. In global terms, this means that wealthy countries like the U.S. [United States] must lead by example when it comes to climate action by undertaking urgent emissions reductions at home and providing hugely ramped-up financial support for action in poorer countries”.

∼Brandon Wu, Director of Policy and Campaigns, ActionAid USA (Wu, 2021)

The concept of ‘climate justice’ emerged in the 1990s, primarily to frame the contrast between rich, industrialized (core) countries that had benefitted from burning large volumes of fossil fuels, and the poorer (periphery) countries that did not and who are more susceptible to the wide range of climate impacts because of a host of historical, economic, political, and social factors. With the concept, came the notion that historical responsibility for mitigating the impacts of climate change rested with the wealthy countries, but not without huge tensions around who should finance the actions. These tensions have remained unresolved and, since that time, a range of academic scholarship has focused on analyzing the constitutive elements of climate justice. Much of it, while acknowledging the interconnectedness with finance, has come to similar conclusions – that raising and distributing large sums of funding to address injustice does not happen in a historical vacuum. Rather, it takes place in a world where stark forms of historical and modern-day inequality, along with grievances over a broad lack of procedural justice, negatively impact the global governance of responses to climate change.

Scholarship in human geography is broadly concerned with understanding the spatial dynamics of societies, economies, and cultures. It has taken up the critical task of deepening understandings of climate justice, emphasizing the need to critically assess how climate change and responses to it function across spatial and temporal scales (Burnham et al., 2013a, 2013b; Chatterton et al., 2013; Fisher, 2015; Routledge, 2011). In this body of work, climate justice has been primarily positioned within the international sphere, as a set of exchanges between nation-states (Barrett, 2013; Fisher, 2015). From early analyses of the unequal distribution of climate impacts across the social landscape (see Kasperson & Kasperson, 2001), a lot of this work has focused on the governance of responses to climate change. This work has highlighted for instance, the negative effects of depoliticized and technocratic approaches to the climate crisis (see Nightingale et al., 2020; Swyngedouw, 2010), particularly within adaptation (see Eriksen et al., 2015, 2021; Mikulewicz, 2020; Omukuti, 2020; Robinson, 2019; Scoville-Simonds et al., 2020). The importance of finance for climate justice has also been noted (Burnham et al., 2013b; Paavola & Adger, 2006). However, despite its core concern with spatial forms of inequality, only limited work in geography has applied a critical lens directly to climate finance (e.g., Bracking, 2015). Moreover, the broader literature on climate justice leaves the role of climate finance undertheorized.

In this article, we help to fill this gap by analyzing climate finance through the lens of world-systems theory, which we see as being a useful framework for considering the political geography of the enduring dependency between states (e.g., Wallerstein, 1979; Shannon [1989] 2018). Broadly, ‘climate finance’ refers to financial resources mobilized to mitigate greenhouse gas emissions and to adapt to the impacts of climate change (Kalaidjian & Robinson, 2022). Today, climate finance is a complex set of mechanisms intended to facilitate the transfer of funds between states for mitigation and adaptation, among other climate responses (Kalaidjian & Robinson, 2022). Climate finance is increasingly variegated, with novel and more fragmented forms of finance emerging (CPI, 2021; Roberts et al., 2021; Weikmans & Roberts, 2019). Given this complexity, assessing the relationships between climate finance and climate justice is not a straightforward task. This entails determining whether the distribution of climate finance, its governance, and its implementation reproduce dependency between states, or whether they can deliver justice that is being sought by marginalized actors.

Scholarship in world-systems theory has posited that international development finance is one mechanism, among many, through which exploitation is carried out and structures of economic and political hierarchy are reproduced (Hayter, 1976; Wood, 1986). Through this lens, we ask whether climate finance reproduces relationships of dependency and furthers the core's exploitation of the periphery, or if it instead has the potential to advance climate justice imperatives. We focus narrowly on public financial resources that are provided to countries in the Global South. Since the agreement of the United Nations Framework Convention on Climate Change (UNFCCC) in 1992, public transfers of climate finance have been seen by developing countries as fundamental to delivering a just solution to the climate crisis (Khan et al., 2020). While financial flows have consistently missed the benchmarks set in UNFCCC negotiations (Roberts et al., 2021; Oxfam, Kowalzig, Carty, & Zagema, 2021), billions of dollars have still flowed through climate finance mechanisms (OECD, 2020; Shannon, 2018; UNFCCC, 2021).

We begin the article with a brief overview of the core tenets of world-systems theory before presenting empirical evidence across five key areas of analysis: (1) spatial flows of climate finance between the core, semi-periphery, and periphery; (2) the governance of climate finance institutions; (3) the types of projects supported by climate finance; (4) the relationship of projects to dominant systems of extraction, production, and consumption; and (5) the agency of peripheral state and non-state actors in shaping climate finance in relation to their interests. Where data is lacking, we highlight areas for future research. By doing this, we also consider how the complex case of climate finance can inform world-systems theory, which has not developed its understanding of the role of international development finance significantly since relatively simplistic analyses of the Bretton Woods institutions (i.e. the World Bank and the International Monetary Fund) in the 1970s and 1980s. Moreover, we draw upon the findings to highlight the ways in which the project of world-systems theory can develop a more nuanced understanding of spatial dependency. We then discuss these findings and their implications for the relationship between climate finance and climate justice and world-systems theory more broadly.

Section snippets

Unequal exchange, uneven development, the global capitalist class and climate governance: theory and space

To understand patterns in the distribution of climate finance, it is valuable to step back to understand how these flows are informed by relations of dependency developed over centuries of colonialism, capitalist expansion, and decolonization under conditions of dependent capitalism. These are forces which also created the conditions for climate change (see Bonilla, 2020; Davis & Todd, 2017; Sultana, 2022; Yusoff, 2018). Theorists of the dependency school suggested that nations categorized as

Spatial flows of climate finance between zones

Hayter (1976) argued in her study of the World Bank, International Monetary Fund, the United States Agency for International Development, and other aid institutions that “aid is, in general, available to those countries whose internal political arrangements, foreign policy alignments, treatment of foreign private investment, debt-servicing record, export policies, and so on, are considered desirable, potentially desirable, or at least acceptable, by the countries or institutions providing aid,

Governance practices

The world-system does not just reproduce itself organically due to differing development trajectories and enduring postcolonial inequalities. Rather, the global division of labor and relationships of unequal exchange are maintained by a system of global governance, which leverages control of peripheral states through processes of both coercion and consent. Specifically, multilateral and bilateral development and financial institutions grew as a postcolonial means of control and appeasement

Types of projects supported by climate finance

World-systems theory would anticipate that not all project types are equally supported. Rather, it would be expected that those projects with benefits for countries in the core receive disproportionate attention, while those that yield less benefits for core countries – and perhaps more benefits for those in the periphery – are neglected. We propose and assess four related predictions.

First, world-systems theory would anticipate that climate finance would disproportionately support greenhouse

Relationship of finance to dominant systems of extraction, production, and consumption

World-systems theory, as well as prior scholarship on unequal development, argues that global flows of production and extraction happen unequally, benefiting countries in the core and exploiting countries in the periphery. Core countries have a vested interest in maintaining barriers to entry to high-profit economic activities, and countries in the periphery are often limited to low-profit opportunities, such as raw mineral extraction, low value materials processing, or the cultivation of cash

Role and influence of peripheral states and civil society

As a theory concerned with the reproduction of inequality globally, early world-systems theory scholarship devoted limited attention to peripheral civil society actors as agents of change (e.g., Wallerstein, 1976, 1979). Numerous critiques during this period argued that world-systems theory offered a deterministic understanding of global economic domination which lacked an understanding of processes of transformation and resistance (see Cox, 1992; Skocpol, 1979; Wendt, 1987). Through this lens,

Conclusion

While geographers and climate scholars have shed light on a myriad questions related to climate justice (e.g., Burnham et al., 2013a, 2013b; Chatterton et al., 2013; Fisher, 2015; Routledge, 2011), there has been little attention to the spatial and scalar patterns in climate finance that contribute to injustice.

World-systems theory offers a useful lens to understand power as it is expressed spatially at a macro-scale and structurally to make inequality durable over time. In applying

Declaration of competing interest

The authors declare that they have no known competing financial interests or personal relationships that could have appeared to influence the work reported in this paper.

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