Key facts
- The SIDS platform would charge senders 3% per transaction, below the 5% to 9% average costs across markets studied.
- After costs, 2 to 2.5 percentage points of each transaction would enter an endowment seeking base-case returns of 6.5%.
- By year 10, the base case estimates a $2.59 billion endowment, or $5.53 billion with matching grants and tourism levies.
- Multilateral climate funds approved just $202 million for SIDS in 2023, per the SIDS document seen by Reuters.
- Remittances to the islands totaled around $22 billion and grew at a 7% compound annual rate between 2010 and 2023, per SIDS figures.
A grouping of small island states aims to create a fund financed by a charge on money their emigrants send home, targeting roughly $3 billion a year for projects that make the islands less exposed to climate change. Representatives of Small Island Developing States set out the plan during COP31 climate talks in Antalya, Turkey, which run until the end of next week.
The target would exceed the roughly $2 billion in international public adaptation finance the islands received in 2021-2022, according to a 2025 study by non-profit research group the Climate Policy Initiative.
Antigua and Barbuda's UN ambassador Walton Webson said the grouping decided it could not wait for the long-running international debate on financing. "We decided that there had to be a way that we can guarantee more reliable sources of funding for the islands," he said. "We cannot rely solely on development assistance again." He said preliminary discussions had taken place with several development banks, with a broader meeting with SIDS leaders planned for January, aiming for progress by COP32 in 2027.
Remittances to the islands totaled around $22 billion and grew at a compound annual rate of 7% between 2010 and 2023, according to figures the SIDS group provided. The platform aims to capture about a third of that total by its 10th year.
Drafted with the help of the International Institute for Environment and Development, the first phase would draw on remittances to the Dominican Republic, Haiti, Jamaica and Guyana in year one, Fiji, Samoa and Tonga in year two, and Comoros, Cabo Verde and Mauritius in year three. The platform would charge senders 3% per transaction, below average costs of around 5% to 9% across the markets studied.