The recently concluded COP29 was marked by high expectations from delegates, negotiators, and parties. Central to these discussions was the call for the operationalization of Loss and Damage funding and the establishment of a new collective quantified goal (NCQG) of $1.3 trillion annually for developing countries. However, as the largest multilateral climate meeting ended over the weekend, many parties expressed dissatisfaction with the $300 billion per year goal proposed for developing countries by 2035.

According to Least Developed Countries (LDCs) and other developing nations, the NCQG falls short of being ambitious, equitable, or adequately targeted. They raised concerns about placing some developing countries on the contributors’ list and the heavy reliance on multilateral development banks (MDBs) to mobilize resources.

Alarmingly, the agreement at COP29 relegated Loss and Damage to a sub-goal rather than prioritizing its operationalization within the NCQG financing mechanism for developing nations. In defense of the outcomes, the European Union stated during the closing plenary that the goal is realistic and fair, emphasizing that all capable contributors should play a role. The EU also highlighted the pivotal role of MDBs in leveraging private investments to meet the funding targets.

Despite supporting the $300 billion goal, the EU acknowledged its shortcomings, particularly the failure of the Troika model and the lack of support for human rights or gender-transformative climate finance.

Mixed Reactions to COP29 Outcomes

United Nations Secretary-General António Guterres expressed his disappointment with the agreement, stating, “I had hoped for a more ambitious outcome for both finance and mitigation, considering the great challenges posed by climate change. But this agreement provides a base on which to build.”

During the closing plenary, Cuba strongly criticized the agreement, accusing developed countries of perpetuating environmental colonialism. India also voiced dissatisfaction, calling the outcomes unfortunate and highlighting a lack of inclusivity. “India opposes the adoption of this document and wants this recorded. India does not accept the goal proposal in its current form,” said the Indian delegation.

India further accused the COP29 Presidency and Secretariat of sidelining their objections by gaveling the decision without allowing them to make a statement. Similarly, Bolivia, Pakistan, and Nigeria expressed frustration with the NCQG’s implementation challenges and limited scope.

• Pakistan: “This is not charity; it is a moral obligation. The climate crisis is turning into a debt crisis.”
• Nigeria: “This is an insult to what the convention stands for. This is not something we can just clap our hands for and accept. $300 billion is unrealistic.”

Challenges in the NCQG Financing Model

The NCQG financing model requires contributions from both developed and developing nations, including Small Island Developing States (SIDS) and Least Developed Countries (LDCs). The text reaffirms Article 9 of the Paris Agreement, setting a goal of $300 billion annually by 2035 for climate action in developing countries.

However, this goal is not an extension of the unmet $100 billion target from 2020, even when adjusted for inflation to 2035. The Paris Agreement emphasizes the principle of Common but Differentiated Responsibilities and Respective Capabilities (CBDR-RC). By deferring financial scaling until 2035, the agreement delays urgent funding needed by 2025 or earlier, leaving vulnerable nations, especially SIDS and LDCs, in precarious positions.

Another contentious aspect is the broad inclusion of funding sources—public, private, bilateral, multilateral, and alternative. While Article 9 places the responsibility on developed countries to provide public climate finance, this decision dilutes that principle by leaning heavily on private and alternative sources.

Such an approach risks undermining equity. Private finance often prioritizes returns over justice-based outcomes, potentially sidelining vulnerable communities with low financial viability. Furthermore, profits from private investments are likely to flow back to developed countries, exacerbating existing inequalities.

Reliance on multilateral mechanisms could perpetuate power imbalances, with wealthier nations dominating decision-making processes in global funds and leaving vulnerable nations with limited agency or unfavorable conditions. This structure reinforces a neo-colonial approach to climate finance which has seen heightened criticism from developing countries however minimal action to realign it.