8 June 2026, Washington DC - The IMF Board has discussed the findings of a new evaluation of its climate work, by its Independent Evaluation Office (IEO).[i] The evaluation identified broad membership support for IMF climate work, but significant gaps in implementation and ambition across the institution. It echoes longstanding civil society demands around the need to assess the impacts of austerity on climate action, the lack of alignment of IMF lending with the Paris Agreement, and how IMF programmes have accelerated fossil fuel expansion.

Recent progress on climate at the IMF – from the Climate Strategy in 2021, the Resilience and Sustainability Trust in 2022, and a financial facility for climate-reform packages – now faces headwinds from the current US administration, which holds a powerful role on the institution’s Board. However, the Chair’s Summing Up of the Board discussion shows wide support from other members to continue climate work.[ii]

For many years, civil society organisations have flagged the contradictions in the IMF’s approach to climate. Research has shown that while the institution has claimed climate is central to macroeconomic stability, integrated climate into its modelling and hired climate staff, countries under IMF programmes have still been obliged to deprioritise public investments on climate action and increase dependency on fossil fuel extraction or other economic activities at odds with their climate commitments.[iii]

This is the case of Argentina, a country that has been under IMF programmes since 2018 and is betting on fossil fuels and mining to repay its debt.

“The expansion of fossil fuel extraction in Patagonia weakens the state's capacity to confront the climate crisis. During the IMF programs, the Environment Ministry has been closed down and the environmental budget has fallen by nearly 80% in real terms. The law that protects glaciers has recently been modified to allow for more activity putting water access at risk,” explained Julia Gerlo from Fundación Ambiente y Recursos Naturales (Argentina).

The new IEO evaluation identifies broad support from the IMF membership for continued climate work. At this point, civil society organisations are arguing that for such work to be meaningful requires a rethink of how the institution works:

“The IEO’s review of the IMF’s 2021 Climate Strategy shows that despite its unprecedented efforts to mainstream climate change considerations at the Fund after decades of delay, significant gaps remain in its approach, especially with respect to integrating climate into core IMF lending programmes. In a rapidly changing climate, for the IMF to fulfil its mandate of ensuring macro-stability it must heed the call of its climate-vulnerable members to transition away from an austerity-first approach, towards supporting green economic transformation,” said Jon Sward, Bretton Woods Project (UK).[iv]

“In the absence of a multilateral debt workout mechanism that allows for timely and effective debt restructurings, countries under IMF programmes are often forced to implement austerity policies which reduce investment in climate action. If the IMF is serious about addressing today’s global challenges it must overhaul its approach to programme design, including by treating climate change not only as a risk but as a necessary investment,” argued Iolanda Fresnillo, Eurodad (Spain).

“Pakistan’s experience exposes a deep contradiction in the IMF’s approach to climate change. While the Fund now speaks of climate resilience and green reform, its programmes continue to prioritise debt repayment and austerity through tariff hikes, subsidy cuts, and new carbon levies that leave less public money for climate adaptation and recovery. These policies are also undermining rooftop solar and distributed renewables while locking the country deeper into dirty coal and centralized energy systems. In one of the world’s most climate-vulnerable countries, climate policy cannot become another pathway for rising inequality, debt and austerity traps, and fossil fuel dependence. The IEO review should serve as a warning bell that the IMF’s approach to climate and debt requires a fundamental rethink,” said Zain Moulvi, Alternative Law Collective (Pakistan).

Contact:

For further comments and analysis, contact Madeleine Race, communications lead at Recourse
[email protected], +447405351150

Notes:

[i] IEO evaluation report The IMF and Climate Change (June 2026) https://ieo.imf.org/en/evaluations/completed/2026-0605-the-imf-and-climate-change

[ii] The Chair’s Summing Up, from the IEO evaluation report (June 2026) https://ieo.imf.org/en/-/media/ieo/files/evaluations/completed/06-05-2026-the-imf-and-climate-change/icc-summing-up-of-the-executive-board-discussion.pdf

[iii] Press release “Report: IMF surveillance falls short in addressing climate threats” and report Green rhetoric, grey reality: IMF surveillance and climate action 2022–2025, Recourse (October 2025) https://re-course.org/newsupdates/imf-surveillance-report/

[iv] V20 communiqué analysis Spring Meetings 2026, Bretton Woods Project (April 2026)
https://www.brettonwoodsproject.org/2026/04/v20-communique-analysis-spring-meetings-2026/