This paper provides a snapshot of development financing in Small Island Developing States (SIDS).

It paper reviews recent key data on domestic and international financial flows, such as development and climate aid, foreign direct investment, remittances, tax revenues and savings. It also explores in detail some SIDS’ continued struggles to maintain debt sustainability.

The paper finds that, on the whole, SIDS have not been able to leverage as much climate and environmental aid as may have been expected, despite their vulnerability to climate change and other environmental shocks. The paper cites limited capacities to apply for and manage climate finance (typically administered via complex funds), as well as unfulfilled donor commitments and a donor bias towards mitigation rather than adaptation finance, as reasons for this.

[Adapted from source]