US withdraws from climate deal to help developing nations

|Published 11:33 AM ET, Friday March 7, 2025|

The United States has withdrawn from the flagship $45 billion Just Energy Transition Partnership (JETP), a global climate finance initiative aimed at assisting developing countries such as South Africa, Indonesia, and Vietnam in transitioning from coal to renewable energy. This move, influenced by President Donald Trump’s “America First” executive order, poses a significant risk to the program’s effectiveness. The decision bypasses the $56 million in grants and $1 billion in commercial investments pledged by the U.S., affecting the overall funding and potentially diminishing trust between wealthy nations and developing countries.

However, other nations such as the EU, UK, and Japan remain committed to the JETP. Germany has taken over co-leadership for Indonesia alongside Japan, despite criticism that the program relies heavily on loans and slow fund disbursement. The situation underscores ongoing disputes about climate finance, highlighted at recent international meetings like COP29 and the G20 summit. ​

This withdrawal aligns with a broader pattern of the U.S. reducing its involvement in international climate initiatives. Recently, the U.S. also exited the board of the U.N. climate damage fund, designed to assist poor and vulnerable nations in coping with climate change-induced disasters. This move is part of President Trump’s strategy to reduce the U.S.’s involvement in climate change initiatives and multilateral efforts. ​

The U.S. had previously withdrawn from the Paris Agreement in 2017, rejoined in 2021 under President Joe Biden, and withdrew again in 2025 under President Trump. These shifts have caused uncertainty in global climate diplomacy and raised concerns about the U.S.’s commitment to addressing climate change. ​

The U.S.’s withdrawal from these climate finance initiatives may hinder global efforts to combat climate change, particularly in developing nations that rely on financial support for mitigation and adaptation projects. The reduced funding could slow down the transition to renewable energy sources and impede progress toward global climate goals.​

Moving forward, it is crucial for the international community to address these funding gaps and reinforce commitments to climate finance. Such efforts may involve exploring alternative funding mechanisms, enhancing collaboration among remaining partners, and encouraging private sector investments to ensure that developing countries can continue their transition to sustainable energy sources.

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