Image Source: President.az
With less than one month to go until COP29 kicks off, the world’s attention is now turning to what needs to happen in Baku. As the clock ticks down—and as natural disasters hit countries around the world—experts are urging the Azerbaijan Presidency and developed nations to commit to strong leadership on climate finance.
“Geopolitically, it is a really tough time for driving political action on a global challenge,” Alex Scott, a senior associate for climate diplomacy at ECCO, said at a recent press briefing. “At the same time we are seeing significant climate impacts this year—hurricanes bashing the US, floods all over the world, wildfires across Canada, climate impacts are hitting lots of countries. The issue of climate change and the realities of what the consequences of inaction are really can’t be ignored anymore.”
In a historic agreement reached in Dubai last year, countries agreed to the transition away from fossil fuels and set targets for renewable energy and energy efficiency. This year in Baku, a good outcome centres on landing a new post-2025 climate finance goal to replace the former $100 billion goal—which developed countries met two years late in 2022. With countries’ national climate plans due in February 2025, a collective agreement on climate finance—and a recommitment to Dubai’s pledge to transition off fossil fuels—is needed to set the stage for success.
Pre-COP negotiations took place last week in Baku with a particular focus on the New Collective Quantified Goal on Climate Finance, or NCQG. The challenges are substantial: countries are debating who, exactly, should provide funding—which countries count as “developed,” and which are still “developing”—as well as how much money the new goal should provide and what the sources of financing should be. The Paris Agreement mandates that the new goal must be delivered before 2025.
Iskander Erzini Vernoit, the co-founder and director at the Imal Initiative for Climate & Development, who attended climate finance meetings last week, said that rifts between the global North and the global South were on display in these discussions.
“Various proposals have come forward from developing countries over the past three years of this process, but we still have not, even over the past two days, seen any new proposals come forward from the developed countries,” he said. With regards to the contributor base, he said, “developing countries have been quite clear that they don’t see this as the correct space to hold the rest of the world hostage to a debate that’s essentially between some of the great powers of the world.”
The outcome of the US election—happening just a week before Baku—could throw another wrench into how countries approach the upcoming COP.
“During the last Trump administration, China stepped in to fill the void, but saw a weakening of ambition over time during the Trump administration,” said Kate Logan, the director of climate at the Asia Society Policy Institute. “This time around, one of the big questions is whether China will take any sort of additional action or capitalise on that immediate window following the election to do anything beyond what they’ve done more actively, or will China maintain that same passive stance in terms of filling the void by default.”
There are some positive signs of progress. In New York last month, the United Nations General Assembly signed up to the Pact for the Future, a document that rededicates the body towards creating “a better and more sustainable future for all.” The text repeats the commitments made by countries in Dubai to transition away from fossil fuels, and pledges to “accelerate meeting our obligations” under the Paris Agreement and the United Nations Framework Convention on Climate Change.
“That gives some kind of hope that global cooperation on this issue is still alive,” said Scott.
Meanwhile, Scott said increased attention to climate finance from the UK’s new government, as well as growing support for climate finance initiatives from the private sector provide a few bright spots in the tough negotiations around the new finance goal.
“The NCQG is a really difficult political fight because it is being fought by negotiators,” Scott said. “It’s not being fought by finance ministries, and that brings with it a different complexity to the negotiations that happen between countries.”
The World Bank and IMF meetings at the end of October give world powers another chance to show leadership on climate finance before COP29.
“I think there is some hope that if we can see some more signs of other ways of mobilising finance for climate action being unlocked,” at those meetings, Scott said. “That that could help build a bit more confidence amongst developed countries that there are other sources of finance that are going to complement what they can put on the table as a provision goal, and amongst developing countries that there are other ways that they will be able to complement what comes from developed countries.”
“The majority of countries are looking to Azerbaijan to steward the new climate finance goal,” added Vernoit. “Developed countries need to come forward on some of the issues that are blocking the talks currently.”
