COP29 Climate Finance Result Still in Doubt

BAKU, Azerbaijan—With little to show after eight days of talks, COP29 negotiators are under pressure to deliver a solid finance deal to help countries most affected and least responsible for climate change before the annual climate conference is scheduled to end Friday .

Previous agreements reached under the United Nations Framework Convention on Climate Change require developed countries to increase financing for developing countries to accelerate the transition to renewable energy and adapt to the deadly and expensive effects of heatwaves, floods, droughts and wildfires. Whether the larger financing package will be linked to a separate loss and damage fund is still being discussed in ongoing negotiations.

Current climate finance amounts to approximately $120 billion per year, which is far below what is needed. Developing countries now say it is time to increase this spending to $1.3 trillion annually by 2030. But the rich countries that have caused most of the climate damage at COP29 so far are relying on “accounting tricks” rather than talking about real increases. Michai Robertson, who has been monitoring the climate finance debate, said: Alliance of Small Island States.

“It’s a little disheartening that we’re actually playing around with exercises and using institutions that don’t have transparent methodologies,” Robertson said immediately after Tuesday’s negotiating session. “So we at AOSIS have a lot of problems with them doing this kind of sleight of hand in accounting.”

The debate boils down to the questions of which countries should be on the issuing and issuing side of the money flow, whether the financing comes in the form of loans or grants, and what the total should be. Developing countries are also pressing for debt relief as some are driven to near-bankruptcy trying to compensate for the damage caused by global warming.

Developed countries say nothing about the nature of the financing in sensitive talks, but in the past most of the money came in the form of loans with stringent conditions.

The last two COP meetings both went into overtime. Discussions of losses and damage have been slowed down by developed countries in 2022. Last year, major oil producers, particularly Saudi Arabia, tried to block any mention of phasing out fossil fuels, then reluctantly agreed to use weak language without providing details about that transition.

Will Rich Countries Rise?

German Foreign Minister Annalena Baerbock said Wednesday, without elaborating on specifics, that future generations will ask: “‘Have you done everything, everything you can, to ensure that our planet is not torn apart by conflicts over scarce land, food and water?’ “The answer is here and now, as we leave COP29.”

He pointed out that if developed countries fulfill their responsibilities, a new page can be opened in climate finance. While the United States is expected to withdraw from the Paris climate agreement during the second Trump administration, as it did in the first, Germany is seen by many as a country with a key leadership role in the climate crisis.

“Germany continues to adhere to its promises,” he said. “We will do our part. But everyone needs to take responsibility here and now, transparently and especially according to their economic power.”

Countries need to leave behind 1990s concepts such as relying solely on public funds for climate finance, he said, because these do not meet today’s needs. He advocated for private sector involvement in climate finance as well as “simpler procedures to make climate finance accessible to those who need it.”

Lídia Pereira, co-chair of the European Union Parliament delegation, said that the European Union has not publicly announced any specific figures for climate finance, but has encouraged developing economies with high emissions, such as China and Saudi Arabia, to contribute to the package. speeches.

Robertson said small island states and other developing countries were under huge pressure to reduce the $1.3 trillion figure set as the baseline for a new climate finance agreement.

A huge increase in climate spending “was promised to us in the Paris Agreement. “This was promised to us by the international community,” he said. “So it’s really disheartening to see the lack of solidarity.”

In addition to the dollar figure, developing countries are pushing for climate funds to be easily accessible without too many conditions.

Harjeet Singh, a Fossil Non-Proliferation Treaty campaigner who has previously worked on reparations, said that under the current climate finance structure, developed countries often tell recipients exactly how the money should be spent, rather than looking at what they need. and a damage fund was created.

“We are actually flying in the dark and we have to finish this COP in two days.”

— Michai Robertson

In some cases, particularly in the case of climate financing from the United States, the requirements include specifying which companies buyers must use to purchase equipment or materials. Conditions may also include that any technical support must come from the funding country, so most of the money in the process goes directly back to the country providing it, he said.

Robertson said the arrival of ministerial delegates on Monday did not indicate much progress. The recent US election is further complicating finance talks: While climate finance has increased under President Joe Biden, President-elect Donald Trump has called climate change a “hoax” and vowed to expand oil and gas drilling, which is causing much of the damage now occurring.

“We’re essentially flying in the dark and we have to finish this COP in two days,” Robertson said. “I think… it’s really sad that a country, because of its own system, can decide more than once when to leave the Paris Agreement and when to return.”

He said it was “something that the American people and voters need to take into account.” I hear everyone talking like, ‘Yes, we’ll continue to do this at the state level, at the municipal level, but we need to see leadership from the top. “This kind of in-and-out behavior does not help ambition.”

Asked about climate finance in the context of recent catastrophic flooding in parts of the Caribbean region, Robertson said developing countries felt abandoned because developed countries did not want to talk about loss and damage in the context of the larger climate finance package.

While loss and damage funds aim to compensate for property destruction, which is often irreplaceable, the larger climate finance package discussed at COP29 is mainly concerned with financing sustainable development and adaptation measures that can prevent future damage.

If the basic structure of climate finance is not changed, he said, this means more countries will be exposed to unsustainable debt, which “will not only affect current generations in those countries, but future generations as well.”