Environmental (Commonwealth Union)_ As the world prepares for the COP29 climate conference in Baku, a pivotal moment has arrived for global leaders to agree on a new international climate finance goal that will significantly support developing nations. According to Simon Stiell, the UN Climate Change Executive Secretary, this year’s conference must serve as the “stand-and-deliver” COP where critical financial commitments are made to protect the global economy and the livelihoods of billions from the escalating impacts of climate change.
Addressing a virtual event hosted by the Brookings Institution, Stiell emphasized that climate finance must be at the core of this year’s discussions, with public funding playing a central role. He called on governments to agree on a New Collective Quantified Goal (NCQG), which will set the amount developed nations need to mobilize annually starting in 2025. Stiell pointed out that while the form of this financial commitment remains to be finalized, public finance must be central, and as much of it as possible should be provided as grants or concessional funding, particularly to nations most in need.
Stiell also highlighted the importance of ensuring that the funds are put to efficient use, emphasizing that countries must leverage private finance to supplement public contributions. He urged the financial markets to receive a clear message, confirming that green investments hold the potential for future gains. This is in line with the objective of enhancing the effectiveness and accessibility of climate finance, guaranteeing the allocation of funds to areas of greatest need.
Countries expect to agree on a revised climate finance target during the crucial discussion at COP29. Under the United Nations Framework Convention on Climate Change (UNFCCC), established in 1992, industrialized nations were tasked with supporting developing countries in combating and adapting to climate change. The commitment made at COP15 in Copenhagen in 2009 was to mobilize USD 100 billion annually by 2020 to assist developing countries. However, the failure to fully meet this target has resulted in a significant trust deficit between developed and developing nations.
Although the Organisation for Economic Cooperation and Development (OECD) reported that developed nations exceeded the USD 100 billion target in 2022 by providing nearly USD 116 billion, nearly 70% of this support came in the form of loans. This has created further complications, as developing nations often require grants or concessional finance to avoid exacerbating debt burdens while trying to address climate challenges.
The conversation around who should bear the financial burden is likely to dominate the negotiations at COP29. While some developed nations, led by the EU and the US, have argued that the global economic landscape has shifted since 1992 and countries like China and Gulf states should now contribute, developing countries strongly oppose this. They argue that those who have historically benefited from industrialization and contributed most to greenhouse gas emissions should bear the responsibility for climate finance. Developing nations emphasize that the principle of equity must remain at the center of these discussions, as many of them are still grappling with poverty, underdevelopment, and increasingly severe climate impacts.
The issue of accountability also remains a key challenge. Stiell emphasized the necessity of transparent mechanisms to monitor the flow of climate finance and guarantee the delivery of promised funds. This accountability is essential to building trust between developed and developing nations, especially in the wake of unmet financial commitments from previous COP agreements.
In addition to increasing financial support, Stiell called for a more rapid scaling-up of funding for climate adaptation and for efforts to create functioning international carbon markets. He also reiterated the need to fund a new generation of national climate plans to implement the promises made during COP28, such as tripling renewable energy capacity, doubling energy efficiency, and transitioning away from fossil fuels.
In his remarks, Stiell warned of the growing divisions between and within nations, cautioning against a rise in isolationist attitudes. He argued that ignoring the climate crisis affecting neighboring regions would lead to catastrophic consequences for the global community, declaring, “If we go down this path, it will soon be game over in the world’s climate fight.”
COP29 presents a pivotal opportunity for the global community to unite and fulfill commitments that have the potential to significantly impact the planet’s future. The world will be watching closely to see if leaders can bridge the gaps between developed and developing nations and establish a robust and equitable climate finance system that addresses the urgent challenges of our time.
