Smart Development: Delivering Wins for Jobs and Climate

Smart development is the idea that the investments countries and companies make to tackle persistent development needs—building roads, growing food, managing waste, or connecting people—can also build resilience and cut emissions. When designed well, these investments last longer, perform better, and deliver more value. Ultimately, this lays the foundations for job creation and sustainable growth. Done right, it’s not a trade-off; it’s a multiplier.

We call these added effects of our development finance “climate co-benefits"—the parts of development projects that help ensure they are fit for purpose in a changing climate and that use technologies and efficiencies to reduce emissions.

Climate co-benefits are not the main reason countries or companies invest scarce resources in a project, but they help ensure those resources are used in ways that are fiscally sound, efficient, and built to last. Some projects have a large share of climate co-benefits—for example, support for a microfinance facility that provides liquidity for sustainable agriculture investments while helping manage flood risks. Others may have a smaller share (sometimes less than 10%) focused on resilience, such as an industrial park investment that includes upgrading access roads in flood-prone areas.

Last fiscal year, the World Bank Group delivered $50.8 billion in development finance with climate co-benefits, including $33 billion that reduced project emissions. While renewable energy is often the first thing that comes to mind, only 17% of that $33 billion supported renewable power generation. The fuller picture is far richer, showing how climate-smart development reaches every core development sector. It’s not an either-or.

Smart development builds physical resilience. In transport, that can mean building roads that can withstand floods, shifting freight from trucks to rail, and moving buses from diesel to electric. In agriculture, it can mean investing in heat-resistant seeds, so a heatwave doesn’t wipe out a harvest, and helping farmers grow more rice with less water. It also strengthens education and health systems—for example, schools and hospitals with insulation, cooling, and storm-resistant structures—so essential services keep operating when disaster strikes.

Here are a few examples of where this approach is already making a difference. In India, a World Bank-supported project is enabling farmers across Maharashtra to adopt climate-resilient practices across 12.5 million hectares. Through more than 37,000 Farmer Field Schools and the deployment of resilient technologies, the initiative is benefiting over 1.3 million smallholders through digitally enabled services and multiplier effects on yields and income.

In Malawi, a social cash transfer program has provided emergency support to nearly 300,000 households during droughts, helping protect food security and speed recovery from shocks.

In Brazil, World Bank Group support for water and sanitation has strengthened water security, expanded access, reduced losses, and mobilized private investment. Today, more than 3 million people in São Paulo have improved access to water and sewage collection, and over 1 million people have gained access to wastewater treatment—while also lowering emissions and supporting the country’s biodiversity.

These investments deliver meaningful results: projects active as of the end of June 2025 have supported 136 million people to have greater resilience to climate risks, and 208.8 million people to have improved food and nutrition security. In the same period, we have expanded access to energy for 214 million people, and enhanced management of 92.7 million hectares of terrestrial and aquatic areas. We expect these interventions to reduce greenhouse gas emissions by 331.8 MtCO2e per year.

This progress is promising, but the stakes are high. Droughts, storms, and floods are growing more frequent and more severe. In developing markets, millions of young people are coming of age and will need jobs to support their families and power future growth. Meeting these challenges will require investment in resilient foundational infrastructure—roads, power, digital access, clean air, land, and water, and health systems—alongside the policy and regulatory reforms needed to mobilize private capital at scale. We are helping advance these priorities through smart development.