Disappointment as COP29 fails to finalise climate finance targets

Negotiations over the New Collective Quantified Goal (NCQG) on climate finance hit another roadblock at the UN Climate Conference COP29, leaving critical funding targets unresolved just before the summit's conclusion. 

Despite three years of talks, countries could not agree on quantified finance goals for supporting developing nations in combating climate change.  

The NCQG aims to channel substantial financial support, particularly in grants or grant-equivalent terms, from developed nations to developing countries. 

This funding would assist with adaptation, mitigation, and addressing loss and damage, as well as implementing key climate plans from 2025 to 2035 that include nationally determined contributions, long-term strategies, national adaptation plans, climate finance strategies, and technology action plans.

However, a new draft text on NCQG released yesterday failed to establish annual targets. 

Climate-vulnerable countries have consistently demanded trillions of dollars in climate finance to address loss and damage, adaptation, and transition to clean energy systems. However, negotiators have yet to agree on the amount of funding, leaving financial commitments undecided and open for further discussion.

Although the draft suggests potential countries that could contribute, it does not specify which nations will take on these financial responsibilities. It also includes a commitment to provide adaptation finance through grants, with a proposed review mechanism before 2031 to potentially increase contributions.

Developing nations have highlighted that an estimated $5.10 to $6.8 trillion will be required to meet the targets up until 2030, which is between $455 billion and $584 billion annually. Moreover, an estimated $215 billion to $387 billion will be required for adaptation needs till 2030.

They also pointed to a need for $4 trillion annually for renewable energy investments to achieve net-zero emissions by 2050 and $4–6 trillion per year for a global low-carbon economic transformation.

Climate negotiators and activists expressed disappointment over the latest NCQG draft which they criticised for its vague language and lack of specific commitments.

Dr Fazle Rabbi Sadeque Ahmed, a Bangladesh negotiator and following NCQG, told The Business Standard, "The text language is weak. As Bangladesh is a member of least developed countries (LDCs), we want a dedicated amount in the text. There is no mention of dedicated funding for adaptation, mitigation and loss and damage is not there." 

Harjeet Singh, climate activist and global engagement director for the Fossil Fuel Non-Proliferation Treaty Initiative, criticised the draft for prioritising grants but omitting financial sub-goals. 

He said, "The revised draft text presents a spectrum of options – some good, some bad, and some outright ugly. 

"We must focus not only on the vast sums required – trillions, as acknowledged – but on ensuring these funds are provided as grants, not loans, to shield nations most impacted by climate change from further financial burdens." 

Md Shamsuddoha, chief executive of Center for Participatory Research and Development (CPRD), highlighted the imbalance in funding priorities. 

"The fund still focuses primarily on mitigation. If the fund continues to prioritise mitigation, the adaptation needs will remain unmet," he told TBS.

"A mitigation-centric approach will create business opportunities for developed countries through their technologies. Therefore, it's not just about target figures but also the quality of the fund." 

While the European Union has proposed a funding range of $200–300 billion, major contributors like the US, the UK, and Japan have not clarified their positions.

The European Union has proposed a funding range of $200-$300 billion for climate action, but major contributors like the US, the UK, and Japan have not clarified their positions.

However, developing nations argue that $1.3 trillion per year is necessary to address the climate crisis effectively. The Like-Minded Group of Developing Countries (LMDC) dismissed the $200 billion proposal as insufficient, emphasising the need for concrete commitments.

Sohanur Rahman, executive coordinator of YouthNet Global and a youth delegate from Bangladesh at COP29, expressed concerns over the lack of concrete financial commitments from the Global North.

He said, "COP29 has shown that without clear and substantial financial pledges from the developed world, the hopes of the Global South remain distant."  

"We need to see real commitments, not just broad proposals, if we are to meet the needs of the most vulnerable communities," he added.

As the COP29 comes to an end today, pressure is rising on developed nations to fulfil the necessary financial commitments for global climate action, with developing nations saying the funding is an obligation under the Paris Agreement rather than an act of charity.

However, the LDCs group doesn't want to leave their hope till the last minutes of the negotiations. 

"We are still hopeful, as some [decisions] are kept for ministerial level discussion. We are waiting for the last minute discussions," said Dr Fazle Rabbi.