With climate finance being a central focus for this year’s COP it was hoped that week one of the conference would see progress made, however countries remain deadlocked, where divisions between developed and developing nations stalled progress on key issues. This included not just climate finance, but also trade measures and equitable responsibility for climate action. The conference has already had a rocky start, with several notable absentees including US President Joe Biden, China’s Xi Jinping, India’s Narendra Modi, as well as key European Union leaders including German Chancellor Olaf Scholz, European Commission President Ursula von der Leyen, and French President Emmanuel Macron[i].
As we reported last week, COP29 is being used to set a new annual figure for climate finance which would see wealthier nations pay to support poorer countries in meeting their emissions targets. The proposed figure dubbed the “New Collective Quantified Goal” or NCQG is supposed to kick in when the current $100 billion pledge expires at the end of this year, as per the Paris Agreement. In terms of the NCQG, developing country groups have proposed a finance target in the region of $1-1.3 trillion a year, but wealthy nations have stressed said that the money cannot come entirely from their budgets. So far, the G-77 & China and BASIC blocs have used COP to demanded accountability from wealthier countries on unmet financial commitments, reiterating the call for $1.3 trillion annually in climate finance, with an emphasis on grants and concessional funding to avoid burdening vulnerable economies already grappling with the impacts of climate change, according to the Economic Times, who quoted an Indian negotiator as stating:
“Loans make up nearly 70 percent of climate finance provided so far. This is unacceptable and places undue pressure on developing economies." they instead urged developed nations to move away from debt-inducing mechanisms[ii].
This call was followed by the release of the Third Report from the Independent High-Level Expert Group on Climate Finance (IHLEG) which found that as part of the global challenge to mobilise over $6 trillion per year to meet global climate goals, $1 trillion per year in international investment for developing countries will be required by 2030.
IHLEG have been tasked with supporting deliberations on the climate finance agenda, helping to develop policy options and recommendations to deliver climate commitments[iii] their third report updates previous estimates of investment requirements for climate action. It also sets out the action agenda to deliver the necessary finance for investment in emerging markets and developing countries (EMDCs) other than China. They state:
“External finance from all sources, international public and private along with others, will need to cover $1 trillion per year of the total investment need by 2030 and around $1.3 trillion by 2035” the researchers add that they believe “cross-border private finance can meet about half of these needs given the changing nature of investment opportunities”[iv]
With a lack of progress thus far, absent world leaders, and concerns from green groups around suitability of the conference hosts (Azerbaijan's President Ilham Aliyev praised oil and gas as a "gift from God" in a speech during COP29, with Azerbaijan itself a major exporter of crude oil and natural gas), it is perhaps unsurprising that there has been growing criticism of the COP event.
The coalition Kick Big Polluters Out, which includes groups Transparency International, Global Witness, Greenpeace and the Climate Action Network, released its analysis showing that at least 1,773 lobbyists from the oil, gas and coal industries were officially accredited to attend the UN meeting in Azerbaijan[v].
However, in perhaps the most significant development, former high-ranking officials including previous UN secretary general Ban Ki-moon, former UN climate chief Christiana Figueres, and former president of Ireland Mary Robinson, wrote an open letter calling for an overhaul of the COP process[vi].
In the letter they argue that climate talks ‘simply cannot deliver the change’ at the pace required:
“28 COPs have delivered us with the policy framework to achieve this. However, its current structure simply cannot deliver the change at exponential speed and scale, which is essential to ensure a safe climate landing for humanity. This is what compels our call for a fundamental overhaul of the COP. We need a shift from negotiation to implementation, enabling the COP to deliver on agreed commitments and ensure the urgent energy transition and phase-out of fossil energy”[vii].
The signatories suggest 7 measures for reform[viii]:
1. Improve the selection process for COP presidencies - strict eligibility criteria is needed to exclude countries who do not support the phase out/transition away from fossil energy. Host countries must demonstrate their high level of ambition to uphold the goals of the Paris Agreement.
2. Streamline for speed and scale- where COP must shift away from negotiations to the delivery of concrete action.
3. Improve implementation and accountability - The COP process must be strengthened with mechanisms to hold countries accountable for their climate targets and commitments.
4. Ensure robust tracking of climate financing - including standardised definitions and criteria for what qualifies as climate finance, along with common reporting frameworks and tracking mechanisms to verify climate financing flows.
5. Amplify the voice of authoritative science
6. Recognise the interdependencies between poverty, inequality and planetary instability
7. Enhance equitable representation - Improving the management of corporate interests within COPs proceedings will require stronger transparency and disclosure rules and clear guidelines that require companies to demonstrate alignment between their climate commitments, business model and lobbying activities.
[i] Scholz Cancels COP29 Trip in Fresh Blow to EU Climate Leadership – BNN Bloomberg
[ii] COP29 week one ends in deadlock as divisions stall climate action progress - The Economic Times
[iv] Raising-ambition-and-accelerating-delivery-of-climate-finance_Executive-summary.pdf
[v] UN urged to ban pro-fossil fuel nations from hosting climate talks
[vi] - Club of Rome
[vii] Ibid
[viii] Ibid
Lauren has extensive experience as an analyst and market researcher in the digital technology and travel sectors. She has a background in researching and forecasting emerging technologies, with a particular passion for the Videogames and eSports industries. She joined the Critical Information Group as Head of Reports and Market Research at GRC World Forums, and leads the content and data research team at the Zero Carbon Academy. “What drew me to the academy is the opportunity to add content and commentary around sustainability across a wealth of industries and sectors.”
