Over $1 trillion needed for developing nations’ climate transition, says ex-World Bank official
Smoke billows from an unauthorized steel factory, foreground, on November 4, 2016 in Inner Mongolia, China. To meet China’s targets to slash emissions of carbon dioxide, authorities are pushing to shut down privately owned steel, coal, and other high-polluting factories scattered across rural areas. (Photo by Kevin Frayer/Getty Images)
Kevin Frayer | Getty Images News | Getty Images
Developing nations will need more than $1 trillion each year to make significant progress in climate transition, according Mari Pangestu, a former World Bank official.
“The estimate is like $1 [trillion] to $3 trillion a year for developing countries to be able to transition,” she told CNBC’s “Squawk Box Asia” on Thursday.
The lack of funding has made it difficult for those countries to reduce their high carbon emissions and shift to clean energy, Pangestu added. This has led to tensions between developing nations and the developed world, which are pushing for more progress in climate related issues.
“This debate is going to continue unless developed countries can see that this is about development and climate — not just about climate,” Pangestu, a former trade and tourism minister for Indonesia, said.
“And that has been the source of tension. You can’t separate the two,” she added, underlining the “key word is actually — transition.”
“How do you transition from the high emission now to clean energy? It will require us to have resources.”
This was “part of the bone of contention,” for the lack of progress made in the recently concluded Group of 20 climate ministers meeting in India, Pangestu said.
The talks in late July wrapped up without consensus on crucial matters to address the climate crisis such as the issue of financing to support developing countries, the document showed.
India’s climate change minister Bhupender Yadav, who chaired the meeting, acknowledged there had been “some issues about energy, and some target-oriented issues.”
Sharp criticism
The July climate meeting was seen as a chance for the world’s biggest polluters to take concrete steps ahead of a G20 leaders’ meeting in September in New Delhi and the COP28 Summit in the United Arab Emirates in December.
The failure to reach a deal drew withering criticism from environmental activists.
“Europe and North Africa are burning, Asia is ravaged with floods yet G20 climate ministers have failed to agree on a shared direction to halt the climate crisis which is escalating day by day,” said Alex Scott of climate change think-tank E3G.
“Reports of Saudi Arabia and China stifling the forum’s political space to even discuss a new direction on the energy transition fly in the face of their claims of defending the interests of developing countries,” he added.
China rejected reports it had obstructed climate discussions at the G20 climate meeting, saying “relevant reports totally run counter to the facts.”
The Ministry of Foreign Affairs insisted the meeting “achieved positive and balanced outcomes.”
“However, some countries introduced geopolitical issues as an obstruction and the meeting failed to adopt a communique. China finds it regrettable,” the ministry said without elaborating.
‘Scale and urgency’
There’s a “scale and urgency” to address the climate crisis, said Pangestu, adding it requires greater effort from all stakeholders.
“Part of that will have to come from countries’ own resources,” she noted. “Also part of it has to come from multilateral development banks and other sources, which are going to reduce the cost and risks — so that you can get private sector to come in.”
Pangestu argued that if developed nations want to move away from fossil fuels and “retire coals plants early,” more support should be provided to developing countries.
“What South Africa and Indonesia have done more recently on this particular issue is say: ‘That’s fine and well, you want us to get out early’ — but who’s going to fund the cost of getting out early?” she asked.
“These are private companies, you have to also compensate them. There’s a legal issue, financial issue. So this is where we need to really get into the policies and the reforms.”
Bret Taylor, chairman of the board of directors of OpenAI, attends the annual Allen and Co. Sun Valley Media and Technology Conference at the Sun Valley Resort in Sun Valley, Idaho, on July 8, 2025.
David A. Grogan | CNBC
Bret Taylor’s artificial intelligence startup Sierra has just joined an exclusive club: The company sports a new $10 billion valuation after raising $350 million in fresh capital.
Sierra is one of just a handful of AI startups, including OpenAI, Anthropic, xAI, Safe Superintelligence and Thinking Machines that are valued at or above $10 billion.
Investors are pouring money into this competitive group of companies in the hopes that they’ll eventually hit the public markets.
Taylor is the chairman of OpenAI’s board, and previously served as co-CEO of Salesforce alongside Marc Benioff. Taylor co-founded Sierra in 2023. The company builds and implements AI agents for customer service. AI agents can carry out tasks autonomously on behalf of their users.
Shares of Salesforce fell 5% Thursday after the company reported weak guidance and concerns lingered about how AI is affecting software companies.
Sierra said its agents are already being used by “hundreds of millions of people” to help with tasks like refinancing homes, ordering lunch, delivering furniture, understanding insurance deductibles and fixing technology, among other things.
Greenoaks led Sierra’s latest funding round, the company said. Its valuation more than doubled from its most recent raise in October.
“We’re in this for the long term,” Sierra said in a blog post on Thursday.
The company said it will use its fresh funding to invest in its platform and focus on domestic and international expansion.
Sierra’s funding follows a flurry of other major AI raises in Silicon Valley. Earlier this week, Anthropic announced it had closed a $13 billion funding round at a $183 billion post-money valuation.
WATCH: Sierra co-founder Bret Taylor on AI agents’ role in an evolving global landscape
Broadcom CEO Hock Tan.
Lucas Jackson | Reuters
Broadcom is scheduled to report earnings for its fiscal third quarter after the close of regular trading on Thursday.
Here’s what analysts are expecting, according to a consensus from LSEG.
- Earnings per share: $1.65
- Revenue: $15.83 billion
Broadcom, which develops custom chips for Google and other huge cloud companies and also makes networking gear needed to tie thousands of artificial intelligence chips together, is expected to report revenue growth of 21% from $13.07 billion a year ago.
Analysts project revenue growth will hold steady the rest of this year and accelerate a bit in 2026.
Broadcom has been one of the chief beneficiaries of the AI boom thanks largely to its accelerator chips, which the company calls XPUs. The processors are generally simpler and less expensive to operate than Nvidia’s graphics processing units, or GPUs, and they’re designed to run specific AI programs efficiently.
Analysts at Cantor Fitzgerald wrote in a report last week that they expect to see increased signs of demand from Google and Meta.
“Additionally, all eyes will turn towards any visibility of current AI Custom Silicon engagements converting into customers with high-volume ramps in sight,” wrote the analysts, who recommend buying the stock.
The analysts estimate that custom silicon could generate $25 billion to $30 billion in revenue for Broadcom next year and more than $40 billion by around 2027. The company generated total revenue of $51.6 billion in the latest fiscal year.
Shares of Broadcom are up 30% this year and have almost doubled in the past 12 months, lifting the company’s market cap to $1.4 trillion.
In the fiscal second quarter, AI revenue jumped 46% from a year earlier to more than $4.4 billion, with 40% from networking. CEO Hock Tan said that number should reach $5.1 billion in the third quarter, “as our hyperscale partners continue to invest.”
Some of Broadcom’s expansion has been fueled by acquisitions, most notably the purchase of server virtualization software vendor VMware for $61 billion in 2023. VMware is key to Broadcom’s infrastructure software business, which accounted for 44% of sales in the most recent quarter.
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