Will COP29 deliver the trillions needed to tackle the man-made climate crisis?

The latest round of UN climate negotiations, COP29, opened this past Monday in Baku, Azerbaijan, following a year that broke multiple extreme heat records and saw widespread climate-driven chaos – from wildfires to destructive floods and to hurricanes – strike nearly every corner of the planet.

A major increase in financial commitments to assist vulnerable countries in mitigating and adapting to climate impacts is the main goal of this year’s conference, which has been dubbed the “climate finance COP.”

Can countries agree on a new climate finance target?

The UN’s main climate science body, the Intergovernmental Panel on Climate Change (IPCC) has issued increasingly dire warnings about the accelerating pace of global warming. To limit temperature-rise to 1.5°C above pre-industrial levels, substantial investments are needed in clean energy technologies, infrastructure, and adaptation measures.

Developing countries, particularly small island nations and least developed countries are disproportionately vulnerable to climate impacts like sea-level rise, extreme weather events, and droughts. They require significant financial support to build resilience, transition to low-carbon economies, and compensate for loss and damage.

A heads-up for the G20

At the midway point, which comes as leaders are heading to Brazil for next week’s G20 summit, round-the-clock negotiations at COP29 in Baku on the always thorny topic of money are reportedly moving slowly. Delegates from developing nations are calling for more and faster progress on new funding for loss and damage and accelerated clean energy goals.

Simon Stiell, Executive Secretary of the UN Framework Convention on Climate Change (UNFCCC), which convenes the annual COP meetings, had a message for G20 leaders early on Saturday before they hopped on their planes for Rio de Janeiro:

“Climate finance progress outside of [the UNFCCC process] is equally crucial, and the G20’s role is mission-critical…the global climate crisis should be order of business Number One, in Rio next week. The [G20] Summit must send crystal clear global signals. That more grant and concessional finance will be available; that further reform of multilateral development banks is a top priority, and G20 governments – as their shareholders and taskmasters – will keep pushing for more reforms.”

Finally, the UN climate chief said that “in turbulent times and a fracturing world, G20 Leaders must signal loud and clear that international cooperation is still the best and only chance humanity has to survive global heating. There is no other way.”

Earlier in the week, Mr. Stiell gave a stark assessment of the stakes: Worsening climate change and the socioeconomic damage in inflicts means “billions of people simply cannot afford for their government to leave COP29 without a global climate finance goal.”

“So, for leaders here and back in capitals – make it clear that you expect a strong set of outcomes. Tell your negotiators – skip the posturing – and move directly to finding common ground,” the UN climate chief said.

In his opening remarks to the World Leaders Climate Action Summit, on Tuesday, UN Secretary-General António Guterres said that 2024 has been “a masterclass in climate destruction.”

He emphasised the critical role of climate finance in addressing the crisis: “The world must pay up, or humanity will pay the price…climate finance is not charity, it’s an investment. Climate action is not optional, it’s an imperative.”

Mr. Stiell echoed this sentiment: “Let’s dispense with the idea that climate finance is charity. An ambitious new climate finance goal is entirely in the self-interest of every single nation, including the largest and wealthiest.”

Beyond the $100 billion pledge

In 2009 at the 15th Conference of UNFCCC Parties (COP15) in Copenhagen, developed countries committed to mobilising $100 billion per year in climate finance by 2020. While this target was finally met in 2022, it has been criticised as insufficient and delayed.

At COP29, negotiators are aiming to set a new, more ambitious target for climate finance. Developing countries are pushing for a significantly higher figure, potentially in the trillions of dollars per year. However, discussions on the exact amount and the modalities for delivering the funds remain contentious.

An early breakthrough on carbon

A significant breakthrough on the opening day at COP29 was the adoption of Article 6 of the Paris Agreement, paving the way for a UN-backed global carbon market. This market will facilitate the trading of carbon credits, incentivising countries to reduce emissions and invest in climate-friendly projects.

James Grabert, head of the Mitigation Division at UN Climate Change, the shorthand by which the UNFCCC secretariate is known, said that this historic agreement will provide countries with a “valuable tool” to meet their climate targets and drive sustainable development.

With COP29 coming on the heels of presidential polls in the United States, impact of a new US Administration on global climate action has been on the minds of many in the corridors of Baku Centre.

At a press conference, President Hilda Heine of the Marshall Islands and Ireland’s Environment Minister Eamon Ryan stressed that despite worries about a US withdrawal from the Paris Agreement, they stressed that the combat against climate change is a global effort requires global cooperation towards a better economy for all. The two leaders also cited the ongoing progress by states and cities as reasons for hope.

Around the clock negotiations are underway at COP29 in Baku, Azerbaijan, on a new global climate finance deal.

Around the clock negotiations are underway at COP29 in Baku, Azerbaijan, on a new global climate finance deal. (UNFCCC)

A just transition, not a ‘stampede of greed’

Before heading to the G20 summit in Brazil, Guterres held several climate-related meetings, including one on critical minerals essential for renewable energy technologies like solar panels, wind turbines, and electric vehicles.

These minerals, such as copper, lithium, nickel, cobalt, and rare earth elements, are crucial for the transition away from fossil fuels, with demand expected to triple by 2030.

Many of these minerals are found in Africa, which could benefit financially. However, there’s concern about a “resource curse,” where countries where these resources are located don’t benefit.

Guterres emphasised managing demand without triggering a “stampede of greed” that exploits and crushes the poor but instead ensures local communities benefit.

Dario Liguti from the UN Economic Commission for Europe also highlighted the need for “sustainable exploitation of these minerals”, especially in emerging markets, to protect the environment and support local communities. In April, the UN chief formed a High-Level Panel to ensure countries and communities with these resources benefit the most.

Young people around the world are increasingly demanding climate action and climate justice. They are calling on governments and businesses to take bold steps to reduce emissions, protect vulnerable communities, and create a sustainable future for all.

After meeting with youth representatives and climate advocates at COP29, the Secretary-General posted on social media that he understood their frustrations: “You have every right to be angry. I am angry too…because we are on the verge of the climate abyss, and I don’t see enough urgency or political will to address the emergency.”

Basmallah Rawash, a Climate Activist with Care About Climate, said, “We are not the ones that are supposed to carry the burden of mitigation. We are not the ones who have caused this, but we are the ones that will carry the burden of the biggest struggle at the moment.”

The decisions made in Baku will have far-reaching consequences for generations to come. It is imperative that negotiators reach an ambitious agreement that delivers the finance needed to build a resilient and low-carbon future for all.