COP29: Finance talks held up after discontent mounts over latest proposal

Efforts to establish a global climate finance target at the UN Climate Change Conference in Baku stalled Nov. 22 as many developing countries voiced dissatisfaction over the latest funding proposal.

The draft text of the New Collective Quantified Goal (NCQG) released Nov. 22 proposes that developed countries take the lead to provide $250 billion by 2035 to developing countries to combat climate change.

This funding will be sought from "a wide variety of sources, public and private, bilateral and multilateral, including alternative sources," the text added.

However, this is much lower than what developing countries were calling for, which was for a quantum ranging from $1 trillion to $1.3 trillion annually.

However, the latest draft also called on "all actors to work together to enable the scaling up of financing to developing country parties for climate action from all public and private sources to at least $1.3 trillion per year by 2035."

COP29, which started on Nov. 11, was poised to finish on Nov. 22, but with no final deal yet talks are set to continue over the weekend.

Developed vs developing

The latest documents also did not include any mention of "transitioning away from fossil fuels" to build on what was agreed at COP28 in Dubai last year.

Azerbaijan, which heads the COP29 presidency, urged parties to "study this text intently, to pave the way towards consensus, on the few options remaining."

However, many countries, especially from the developing world have expressed displeasure on the latest text.

Ali Mohammed, Kenya's special envoy for climate change called the proposal "totally unacceptable and inadequate."

"The Adaptation Gap Report alone says the adaptation needs are $400 billion; $250 billion will lead to unacceptable loss of life in Africa and around the world, and imperils the future of our world," added Mohammed, who is also the chair of the African Group of Negotiators at COP29.

Some policymakers said the inclusion of the $1.3 trillion was a positive development compared with previous texts.

"It's been a hard-fought week, but this proposed number of at least $1.3 trillion with a public floor of $250 billion, for clime finance to developing countries shows that negotiators are taking this crisis seriously," said John Verdieck, director of international climate policy at The Nature Conservancy.

"Unfortunately, saying that 'all actors' have the responsibility is too ambiguous and could allow wealthy nations to skirt their responsibilities," Verdieck added.

Agreement of the NCQG, which will replace the $100 billion/year fund established as part of the Paris Agreement in 2015, is a key objective of COP29.

Developed nations want the donor base to be broadened to include countries like China, and they argue that a multilayered NCQG with a global investment target would send strong signals to diverse stakeholders helping to mobilize climate finance.