Wealthy countries have agreed at the UN climate talks to triple their financial supports to $300 billion a year for vulnerable developing nations after a last-minute deal was reached in Baku early on Sunday.
It followed a tense weekend at Cop29 in Azerbaijan, as the talks overran their deadline and many developing countries rejected what was on offer as insufficient to help them avoid climate catastrophe while keeping global warming to within 1.5 degrees.
The deal followed fractious and at times openly hostile negotiations over the past two weeks, with an agreement that even its supporters acknowledge is insufficient and disappointing.
What was agreed was “a new global finance goal”, committing to reach “at least $300 billion by 2035″, with an expanded set of financial flows including from private finance and multilateral development banks.
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Over the weekend, rich countries agreed to “a roadmap” to close the gap to $1.3 trillion with a review in 2030. The deal will mean China will contribute to climate finance for the poor world voluntarily, unlike rich countries which are obliged to provide cash. There were also significant measures agreed on making carbon markets more robust.
US President Joe Biden said that while “substantial work” remained to be done, the conference had set an “ambitious international climate finance goal”.
“While some may seek to deny or delay the clean energy revolution that’s under way in America and around the world, nobody can reverse it – nobody,” he said.
Minister for Climate Eamon Ryan said it was “a hopeful step towards ensuring financial fairness for the countries that need in most”. In a world ravaged by war, conflict and uncertainty, he said it showed multilateralism was still working and essential.
“It moves the world much closer to reforming the global financial architecture so developing countries can have access to affordable finance for critical investment in areas adaptation. It mandates the significant ramp up of ambition from the World Bank and multilateral development banks when it comes to supporting climate action and development,” he added.
The Azeri hosts, acting as lead negotiators, hosts brokered an agreement after a lengthy closed-door meeting with a small group of ministers and delegation heads including China, the EU, Saudi Arabia, Brazil, the UK, US and Australia, on key areas of dispute on climate finance and the transition away from fossil fuels.
Many developing world had reacted with anger to a draft $250bn climate finance target on Friday, dismissing it as a “joke” and far below the amount that is needed to help the poor shift to a low-carbon economy and adapt to the impacts of extreme weather. It prompted a diplomatic effort behind the scenes to increase the offer from developed nations.
A furious speech from India’s representative shortly after the passing of the $300bn deal showed intense frustration still remained over the agreement. Chandni Raina, an Indian delegate, described it as “an optical illusion”
“We cannot accept it ... the proposed goal will not solve anything for us. [It is] not conducive to climate action that is necessary to the survival of our country,” she told the closing plenary, adding that the amount was too small.
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Mohamed Adow, director of the Power Shift Africa think tank, said: “This [summit] has been a disaster for the developing world. It’s a betrayal of both people and planet, by wealthy countries who claim to take climate change seriously. Rich countries have promised to ‘mobilise’ some funds in the future, rather than provide them now. The cheque is in the mail. But lives and livelihoods in vulnerable countries are being lost now.”
Ani Dasgupta, chief executive of the US-based World Resources Institute think tank, said: “Despite major headwinds, negotiators in Baku eked out a deal that at least triples climate finance flowing to developing countries [from a previous long-standing goal of $100bn a year].
“The $300bn goal is not enough, but is an important down payment toward a safer, more equitable future. The agreement recognises how critical it is for vulnerable countries to have better access to finance that does not burden them with unsustainable debt.”
Several ministers from Global North countries argued a deal may be easier now than next year, when Donald Trump will be US president and right-wing governments could be returned at elections in several countries, including Germany and Canada, and they do not want to make a commitment they cannot meet.
Claudio Angelo, from Observatório do Clima in Brazil, said rich countries had “clearly arrived to ditch their obligations”. “After three years of negotiations the first time we ever saw quantum in the text was yesterday,” he said.
He said $300bn in grant funding was “way, way below” what developing countries needed. “Remember, many of them are already in deep debt,” he said. “To have climate finance as the current text proposes will only entrap those countries more.”
