How the money flows: analyzing international finance for climate change adaptation in Ethiopia

In both scholarly and policy spheres, the importance of international climate finance in enabling developing countries to mitigate and adapt to climate change is seen as vital. In recent years, studies tracking climate finance flows to developing countries have relied on self-reported data by developed countries on climate finance provided. However, there is limited understanding of what happens once climate finance is received by developing countries, how it is distributed, and what challenges exist in disbursing and using it nationally. We address these knowledge gaps by analyzing adaptation finance flows in Ethiopia. Using a mixed-methods approach, including analysis of a domestic aid dataset, document analysis, and interviews with national-level government officials and donors, we ask: (i) how is international adaptation finance flowing through existing institutional structures and processes; (ii) what is the extent and scope of international adaptation finance received by Ethiopia over the period of 2011–2023? and (iii) what challenges exist in governing these financial flows and with what consequences for oversight of adaptation finance received at the national level? Our findings identify the complex factors and dynamics shaping national-level adaptation finance governance in Ethiopia, including lack of sufficient coordination and institutional tensions. In concluding, we draw out implications for promoting transparency and accountability within developing countries for international adaptation finance utilization, particularly since current debates on climate finance focus on developed country provision of finance rather than domestic dynamics of finance received.