RICH countries will have to spend about $550 billion a year to help developing countries tackle climate change, the World Bank has estimated before crucial international talks next week.
In a major report, the global financial organisation finds the developed world, including Australia, will have to increase significantly its climate aid to meet the figure - now just $10 billion annually - to keep global temperature rises to just 2 degrees.
The World Development Report 2010 also outlines significant damage to developing countries from climate change, with up to 80 per cent of all costs associated with global warming borne by poorer countries.
Global climate financing for poor countries has become a political issue in Australia this week, with Nationals senator Ron Boswell questioning whether taxpayers wanted to pay the costs associated with climate change in developing countries.
He said: ''It is a wake-up call for taxpayers in developed countries like Australia who will be asked to pay the bill.''
Climate Change Minister Penny Wong, who flies out today to a meeting of climate change ministers in Washington, said financing would be a crucial part of reaching an ambitious global agreement on climate change. Developing countries, including China and India, are refusing to curb carbon emissions unless financing is provided.
Oxfam Australia executive director Andrew Hewett said the world had an obligation to help poorer nations prepare for climate change because they were the least responsible but the most affected.
An Oxfam report yesterday also warned against the diversion of existing aid dollars into climate change programs. It found that if $US50 billion ($A58 billion) a year was drawn from existing aid dollars, crucial AIDS, education and health programs would be depleted, resulting in the deaths of millions more children a year.
The Australian Government has yet to nominate its preferred figure for international financing, but wants decisions on the size and management of a global fund to be made at the G20 heads of states meeting to be attended by Prime Minister Kevin Rudd next week.
The Government will also present a report - written with input from Indonesia and South Africa - which is expected to argue that private funds from carbon markets should comprise a substantial part of the financing effort, above direct government funding and aid programs.
Climate Institute chief executive John Connor said that a meeting of G20 finance ministers, attended by Treasurer Wayne Swan earlier this month, was supposed to begin discussing financing mechanisms but had been a bust.
He said that was in part because developing countries were questioning whether the G20, as opposed to the UN, was the right place to develop a financing position.
Mr Swan wrote in The Wall Street Journal earlier this month the G20 was uniquely placed to create momentum on the issue.
''We can build momentum for the upcoming Copenhagen meeting by showing that we have a common understanding of the need to boost public funding to support adaptation and mitigation action in developing countries, both by facilitating private financing through international carbon markets and by providing additional public funding,'' he wrote.