On the third day of the COP29 conference in Baku, Azerbaijan, the COP29 co-chairs published a draft text on climate finance goals. However, the 34-page document meant for discussion comes against the backdrop of the tattered negotiations in Bonn earlier this year, where negotiators could not settle on the amount required and contributions of each nation. With only 9 days left, will there be an agreement in Baku?
Climate finance has been a contentious issue since countries adopted the UN Framework Convention on Climate Change in 1992. Now, stay with me, in 2009 during the COP15 summit in Copenhagen, developed countries agreed to collectively mobilize $100 billion per year by 2020 to support developing countries in mitigating and adapting to climate change.
The $100 billion target was only recently met in 2023, following extended discussions and efforts to boost contributions from developed nations, and the amount is being used as the floor of discussions to increase the amount post-2025.
Among the Global South negotiators, the Like-Minded Developing Countries (LMDC) group has suggested that $1 trillion per year is needed, the Arab Group has called for $1.1 trillion, the African Group $1.3 trillion, India $1 trillion, and Pakistan $2 trillion- upto 2030 to meet the target of the Paris Agreement.
In contrast, developed nations want the NCQG to be a broad, global investment goal that includes funding from multiple sources, including governments, private companies, and investors. This sentiment stems from the fact that the global economic landscape has shifted since the landmark Kyoto Protocol of 1997 when emerging economies were not included in emissions reduction obligations. Many of these economies have since grown significantly wealthier.
According to Arjun Dutt, Senior Programme Lead at the Council on Energy, Environment, and Water (CEEW), the $100 billion figure was the result of a political compromise. The NCQG needs to be evidence-based, reflecting the needs and priorities of developing countries. Will it boil down to political will to solve the technicalities?
With little time left, Parties welcomed the decision to transition to a draft text and, for the first time in the three-year technical process, described it as a workable basis for discussion. However, it is important to note that to meet the financial goal, the structure of the goal needs to be agreed upon.
