Some of the world’s wealthiest countries from across the Global North and the Global South are urging ministers and negotiators at COP29 to get serious about climate finance, as talks around a new $1.3 trillion annual continue.
The G20’s Leaders’ Summit, which brought together some of the planet’s most powerful sovereign countries (and its biggest emitters), wrapped up this weekend in Rio as those in Baku headed into the second week of COP29. In the G20’s final communique, released Monday evening, leaders said they want a “positive outcome” on climate finance at the UNFCCC COP29 currently underway in Baku. They also reaffirmed their commitment to strengthened multilateralism, the UNFCCC and the pursuit of the 1.5ºC temperature increase limit established in the Paris Agreement.
“G20 Leaders have sent a clear message to their negotiators at COP29: do not leave Baku without a successful new finance goal. This is in every country’s clear interests,” said Simon Stiell, the Climate Change Executive Secretary of the UN.
The climate finance details in the declaration are remarkably thorough. The text recognizes the need for rapidly and substantially scaling up climate finance from billions to trillions from all sources. It also focuses on reforming global financial institutions and debt structuring to make funds available for developing nations struggling to address climate challenges.
In its discussion of climate finance, the countries state that a reform of global multilateral development banks will be crucial to ensure the success of climate action. Increasing financing from the world’s multilateral banks, which control more than $23 trillion across 155 countries, has long been an ask for advocates seeking to free up more money in the system.
Experts praised a remarkably streamlined communique considering the larger tumult in the political system.
“Despite the tense geopolitical times, the G20 delivered a united result thanks to Lula’s resolve. On the back of the US elections, getting a communiqué that does not backslide on existing commitments was a big challenge, especially with Russia and others determined to block progress,” said Linda Kalcher, Executive Director of Strategic Perspectives. “Leaders pushed back strongly on climate denialism, they committed to the Paris Agreement and to work together on a successful outcome in Baku. The real litmus test now for effective multilateralism on climate is bridging the divides to agree on a meaningful new climate finance goal. It’s time for the G7 to put their cards on the table and talk numbers.”
The G20 communique also launched an alliance to combat hunger and poverty and called for the taxation of the super-rich. The communique explicitly includes a reference for cooperation to ensure that ultra-high-net-worth individuals are effectively taxed. A 2% wealth tax can mobilise US$250 billion a year, and can be crucial to freeing up money for climate finance to help developing countries build resilience and transition to clean energy.
There are some climate blind spots in the communique. The G20 text doesn’t specifically advance the ‘transitioning away from fossil fuels’ language that was agreed on in 2023 in Dubai.
“The G20 has sent the right signals on finance: they are willing to engage meaningfully in conversations about needed reforms to the international financial architecture, and back up the outcomes of negotiations on a new climate finance pledge here at COP29,” said Catherine Abreu, Director of the International Climate Politics Hub. “But they’ve failed to reiterate the global commitment made last year to accelerate the transition away from fossil fuels. No amount of finance can save us from a world that’s warmed by 3-4 degrees, which is what awaits if major global powers keep sidestepping the need to phase out coal, oil and gas. Brazil’s G20 outcomes have made its work to land Mission 1.5 at COP30 next year more difficult and more important than ever.”
Nevertheless, all eyes are now on the final days of negotiations in Baku as countries look to reach what could be a landmark climate finance deal.
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