COP29 Ends With a $300Bn Deal on Climate Finance After Bitter Fight

COP29 Ends With a $300Bn Deal on Climate Finance After Bitter Fight

Nearly 200 countries agreed to triple the amount of money available to help developing countries confront rapidly warming temperatures.

But the deal reached at the close of the two-week COP29 summit in Azerbaijan resulted from fractious and at times openly hostile negotiations, producing an agreement that even its supporters may see as insufficient and disappointing. The process of global climate cooperation will lurch forward from here under the weight of heavier existential questions.

Global temperature rise is on the cusp of 1.5C — a critical tipping point for avoiding the most catastrophic consequences of climate change.

“We needed to leave Baku with an agreement to keep the multilateral system alive,” said Juan Carlos Monterrey-Gomez, Panama’s special representative for climate change. “We kept the system alive. But I think 1.5 is dead.”

Rich countries have pledged to provide at least $300 billion annually by 2035, through a wide variety of sources, including public finance as well as bilateral and multilateral deals. The agreement also calls on parties to work toward unleashing a total of $1.3 trillion a year, with most of it expected to come through private financing.

Developed and developing countries entered the negotiations far apart. At one point on Saturday, the talks appeared to be on the brink of collapse, before numerous closed-door meetings brought a deal closer.

Rich nations are grappling with a slew of fiscal and political constraints, including inflation, constrained budgets and rising populism. The election of Donald Trump and his threat to pull the US out of the landmark Paris climate agreement also  cast a shadow on the summit.

Under a compromise, rich nations eventually agreed to commit $50 billion more than called for in a draft agreement on Friday. They had also made any agreement contingent on reaffirming last year’s COP28 outcome in Dubai that included a vow to transition away from fossil fuels.

But Saudi Arabia, leading a bloc of Arab nations, opposed the move to single out any sector.

“There is definitely a challenge in getting greater ambition when you are negotiating with the Saudis,” John Podesta, the top US climate negotiator, told reporters. “At a time when the world is facing such catastrophic effects from climate change an inch at a time is not enough.”

In the end, developed countries had to settle for simply reaffirming the deal reached last year at COP28 in Dubai, without explicitly referencing “fossil fuels” by name.

‘Too Little’ 

The promised funding falls short of the trillions of dollars poor and vulnerable nations say they need to climate-proof their economies. They also want more of that money to come in the form of grants and other affordable financial support, since market-based loans risk deepening their debt burdens.

The deal’s adoption came over the objections of India, whose delegates had raised their hands in an attempt to intervene, and as the gavel fell, walked up to the stage in a failed bid to get attention.

India’s representative Chandni Raina called the deal inadequate. “The goal is too little, too distant,” she said, her speech punctuated frequently by applause and cheers.

Still, for some the result will likely serve as proof the COP process is still the best approach for coordinating global action to meet the escalating challenges of climate change.

“COP29 took place in tough circumstances but multilateralism is alive and more necessary than ever,” Laurence Tubiana, chief executive office of European Climate Foundation, an architect of the landmark Paris Agreement.

The new agreement will help inform individual country commitments for cutting greenhouse gas emissions by 2035 as well as the next round of UN climate talks in Brazil. Many developing nations emphasized the smaller-than-hoped finance commitment would slow their transitions to emission-free energy and constrain their ambition in setting carbon-reducing targets due in February.