4 days Ago By Akanksha Mishra
New Delhi: The latest draft text of the New Collective Quantified Goal (NCQG) on climate finance, the centrepiece of COP29, released by the negotiators early Thursday morning, had one key thing missing: the financing target. Wherever the figure should have been, the draft simply said “USD [X] trillion”, highlighting the difficulty of reaching a consensus on the climate financing goals. The NCQS on climate finance will outline a new financial target to support emerging economies, which bear a disproportionate burden of climate change, in their climate actions post 2025—a key element of the 2015 Paris Agreement.
It will replace the $100 billion per year that developed countries had agreed to provide by 2020 at COP15 in 2009. Deciding the quantum and other aspects of climate financing was one of the central aims of this edition of the climate conference in Baku, Azerbaijan, dubbed the ‘finance COP’ for this reason. The draft text, which is 10 pages long, down from the last iteration of 25 pages, has two ‘ministerial options’ in line with the demands of emerging economies and developed nations.
Both options differ considerably in how they define their demands for climate financing, the sources that would contribute to it, and how much of it would be grant-based as opposed to loan-based. However, neither option actively quantifies the commitment that will be provided to emerging economies to effectively meet their climate targets. Instead, after almost two weeks of negotiations, the draft released on Thursday, leaves the figures in brackets.
“Decides to establish...
climate finance of at least USD [X] trillion of dollars annually,” it said. Emerging economies, including India and China, have said they need $1.3 trillion per year from developed countries for energy transition, adaptation and resilience.
The developed countries have resisted, but have yet to put a concrete number on the table. On 18 November, a Politico report, quoting official sources, said the European Union was looking at a range of $200-300 billion. Officials from the G77 bloc—77 emerging economies—have brushed off these reports.
Also Read: Emerging economies, excluding China, need $1 trillion in climate finance annually—new report at COP29 The new draft text acknowledged that emerging economies need close to $6 trillion in climate finance by 2030. It mentioned the Global Stocktake carried out at COP28 in Dubai, which emphasised the importance of climate financing. The text also underscored that the NCQG too would be established on the basis of the ‘common but differentiated responsibilities’ (CBDR) principle, which forms the basis of the Paris Agreement.
It also included calls to “reduce investment flows towards fossil fuel infrastructure”, noting that the total fossil fuel subsidies in the world in 2022 added up to $1.1 trillion and the total fossil fuel investments were at $958 billion. According to Alejandra Lopez, the head of climate diplomacy at the Colombian think tank Transforma, these are all positive indicators for emerging economies.
“The draft text has all the making of a promising final text—it nods towards the Paris Agreement, the Global Stocktake, fossil fuels, and even loss and damages. It is certainly better than the last draft text presented before the developing countries,” she said at a press conference in Baku. On climate finance commitments, the two different ministerial options outlined how these would be met.
In line with the demands of the emerging economies, the first option sets out the target of “USD [X] trillion annually from 2024-2025”. It said that this will be “mobilised from developed countries to all developing countries”. Emerging economies, including India, China, and African nations, have previously said that the burden of finance for climate action lies squarely on the shoulders of developed countries.
The first option also adds that contributions from emerging economies would be voluntary and would not count towards the NCQG commitment. The second ministerial option makes no such claims, instead talking in broad terms about the need for “multiple sources of finance” and “actors across financial and policy landscapes” coming together. It is also more ambiguous on the final target, simply saying that the goal would be to “scale up to USD [X] trillion per year, by 2035”.
COP29 will end on 22 November. However, experts say the discussions could continue into the weekend depending on whether the parties are able to arrive at a satisfactory NCQG text. The lack of a final number has drawn criticism from experts.
At a press conference in Baku, Harjeet Singh, the global engagement director for the Fossil Fuel Non-Proliferation Treaty Initiative, said, “After months of negotiations and demands, the developed countries don’t have the courage to put an actual number on the table.” “They will try to squeeze negotiations in the last 24-48 hours, which isn’t in good faith,” he added. At another press conference, Sindra Sharma, spokesperson for the Pacific Islands Climate Action Network, said, “We’re all here to discuss a number but there is still no number.
It is frustrating to be here year after year to only be faced with an uphill battle for finance at the last minute.” Despite the sticking point, the new draft text has been received positively by some. In a post on X, the African Group representative, Ali Mohamed, said that the bloc “welcomes the new draft decision text on #NCQG, now much streamlined.
These ten pages contain many of the principled positions from the African Group and other developing countries”. However, he added that the “elephant in the room” remains the lack of a number for climate finance. (Edited by Sanya Mathur) Also Read: India’s emissions could go up 4.
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