The recent COP29 at Baku exacerbates the divide between developed and developing countries, as rich nations refuse to take financial responsibility for climate change
Image Source: Getty
“This document [the NCQG resolution] is nothing more than an optical illusion. This, in our opinion, will not address the enormity of the challenge we all face. Therefore, we oppose the adoption of this document,” stated India’s negotiator Chandni Raina, at the 29th United Nations (UN) Conference of Parties on Climate Change (COP29). Nigeria’s delegation also referred to the resolution as a “joke”.
At COP29, dubbed the ‘Finance COP,’ climate finance was to take centre stage, primarily to settle on the New Collective Quantified Goal (NCQG) climate fund for mitigation and adaptation. Given the widening gaps between green transition targets, adaptation needs, and available financing, developing countries demanded US$1 trillion be mobilised annually. However, the adopted resolution stipulates that only US$300 billion will be generated annually by developed nations till 2035.
The principal need from this NCQG was to provide adequate, clearly assigned funding to fight climate change—unfortunately, the agreed-upon funds are ludicrously below the target. Worse still, there is nothing mentioned on the specific adaptations to the irreparable impacts of climate change, and on the loss and damage caused.
Given the widening gaps between green transition targets, adaptation needs, and available financing, developing countries demanded US$1 trillion be mobilised annually.
COP29 is a clear indication that developed nations do not intend to honour the principle of “common but differentiated responsibilities and respective capabilities” set by the UN Framework Convention on Climate Change (UNFCC). The developing world, bearing the brunt of climate change, cannot rely on developed nations to shoulder the responsibility of fixing the damage wrought by their historical and ongoing emissions. That such an NCQG was adopted underscores the limits to global cooperation when it comes to climate change finance. This extremely underfunded pot must pay for the adaptation to climate change, mitigating greenhouse gas emissions and for the irreversible loss and damage caused by the impacts of climate change, which affect mainly the less developed nations that did the least to cause this harm.
Despite its adoption, all aspects of the NCQG are under debate, the first being the amount that developed nations owe to developing nations. The NCQG is a successor to three decades of negotiations around the nature and sources of international climate finance. Past targets have not been met willingly, punctually or sincerely—the target of US$100 billion in climate finance set in 2009 which was meant to be achieved by 2020 and is expiring in 2025, was only met two years past the deadline in 2022, and some reports show that this was only made possible by adroit work in relabelling existing development aid as climate funds.
A priority for the Baku conference was to make climate funding available based on the real-world needs of the developing nations. As climate change accelerates, it is increasingly urgent to set and reach ambitious targets to prevent global disaster. Developing countries require trillions of dollars to be mobilised, and at Baku, their demand was set at US$1.3 trillion annually. Half measures simply won’t be enough, but here we have quarter measures passed off as sufficient by the rich nations.
The two sides— developing nations who need to receive funding and developed nations who are expected to provide it—disagree on the question of who should contribute, how much they should contribute, and what type of financing it should be. Developing countries argue that these climate investments should come from public funds, grants, and concessional loans. A primary issue with other sources is that they are simply not just and suitable forms of funding. Non-concessional loans have high interest rates despite most developing countries struggling to pay existing international debts. Moreover, they can also be hard to access, non-transparent, and have stringent eligibility requirements. Given their historical contribution to greenhouse gas emissions, developed nations bear a moral and ethical responsibility to provide climate mitigation and adaptation funding to developing nations.
Non-concessional loans have high interest rates despite most developing countries struggling to pay existing international debts.
At Baku, the United States (US) and the European Union (EU) argued that emerging economies like China should now be required to contribute. However, when compared with the current contributors (Annex II countries), measuring per-capita historical emissions and income, China still ranks far below any of them. According to the World Resources Institute (WRI), “almost every scenario combining emissions and economic metrics ascribes the greatest responsibility to provide climate finance to the United States’, yet the US has consistently fallen short on its targets, further threatened by Trump’s re-election promises to cut back climate financing.
Developed nations argued that the targets should be ‘realistic’, since they claim that they struggled to meet the modest billion-dollar target previously, which resulted in the COP29’s paltry US$300 billion deal and a ‘loser call’ to raise the US$1.3 trillion by 2035 from a wide range of sources, including private investments and through voluntary contributions by developing nations. Aside from being grossly insufficient, the deliberative procedures surrounding its adoption also resulted in further entrenchment in the divide between the developed and developing nations.
Before the conference began, Azerbaijan’s presidency was criticised, as it was the third ‘petrostate’ host in the past three years—its government revenue is highly dependent on fossil fuels. This criticism was further strengthened by the absence of any references to ‘transitioning away from fossil fuels’, a phrase celebrated as a turning point at COP28 in Dubai.
Each day of the conference led to reports of improper deliberations and rushed resolutions, with former UN Secretary-General Ban Ki-moon calling the process “no longer fit for purpose” in an open letter. After Friday’s negotiations ran into Saturday, two developing country alliances, the Least Developed Countries (LDCs) and the Alliance of Small Island States (AOSIS), staged a walkout over the proposed NCQG, claiming negotiations had been exclusionary. India went so far as to accuse the hosting Presidency of Azerbaijan and the UN Climate Change Secretariat of “stage managing” the resolution of the NCQG, a sentiment echoed by many developing countries, bringing the entire plenary process into question.
All countries, particularly the developed nations, need to get started to make sure they can make their Nationally Determined Contributions due early in 2025.
Adding fuel to the fire, while developing nations protested the deliberations and highlighted the breakdown in international cooperation, developed nations seemed to claim the opposite. US President Joe Biden called it a “historic outcome” and EU Commission President Ursula von der Leyen claimed the Baku deal signalled “a new era for climate cooperation and finance”. However, if this is a new era, it is far from one of cooperation. COP30 in Belem, Brazil, will have to step up and manage the weakening diplomatic relations to pass meaningful resolutions on the many cans that have been kicked down the road for next year.
All countries, particularly the developed nations, need to get started to make sure they can make their Nationally Determined Contributions due early in 2025. They must focus their efforts on generation financing, whether private, domestic, or through multilateral development banks (MDBs), for the adaptation measures desperately needed in the developing world.
COP29 should have made history by confirming the debt owed by the wealthiest nations to the planet and ensuring the funding needed by places that are least responsible for the mess the planet is in. Unless they pay up, everyone will suffer.
Vikrom Mathur is a Senior Fellow at the Observer Research Foundation.
The views expressed above belong to the author(s). ORF research and analyses now available on Telegram! Click here to access our curated content — blogs, longforms and interviews.
Vikrom Mathur is Senior Fellow at ORF. Vikrom curates research at ORF’s Centre for New Economic Diplomacy (CNED). He also guides and mentors researchers at CNED. ...
Read More +.jpg)
PREV