COP29 Ends With Deal on Climate Finance After Bitter Fight

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(Bloomberg) — Nearly 200 countries have agreed to triple the amount of funds available to help developing countries cope with rapidly rising temperatures.

But the agreement reached at the conclusion of the two-week COP29 summit in Azerbaijan was the result of tense and at times openly hostile negotiations, resulting in an agreement that even its supporters may find inadequate and disappointing. Hence, the process of global cooperation in the field of climate will advance under the weight of heavier existential questions.

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Global temperatures are on the cusp of 1.5°C – a critical turning point to avoid 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 range of sources, including public financing as well as bilateral and multilateral deals. The agreement also calls on the parties to work to unlock a total of $1.3 trillion annually, most of which is expected to come through private financing.

Developed and developing countries entered the negotiations far apart. At one point on Saturday, it appeared that the talks were on the verge of collapse, before several closed-door meetings led to an agreement.

Rich countries grapple with a plethora of fiscal and political constraints, including inflation, constrained budgets, and rising populism. The election of Donald Trump and his threat to withdraw the United States from the historic Paris climate agreement also cast a shadow over the summit.

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Under a compromise, rich countries eventually agreed to commit $50 billion more than the draft agreement called for on Friday. They also made any agreement conditional on reaffirming the outcomes of last year’s UN Climate Change Conference (COP28) in Dubai, which included a pledge to transition away from fossil fuels.

But Saudi Arabia, which leads a bloc of Arab countries, opposed this move to target any sector.

“There’s definitely a challenge in being more ambitious when you’re negotiating with the Saudis,” John Podesta, the lead US climate negotiator, told reporters. “At a time when the world is facing such catastrophic impacts from climate change, one inch at a time is not enough.”

In the end, developed countries had to content themselves with reaffirming the agreement reached last year at the United Nations Climate Change Conference (COP28) in Dubai, without explicitly referring to “fossil fuels” by name.

“Very little”

The promised financing falls short of the trillions of dollars that poor and vulnerable countries say they need to protect their economies from climate change. They also want more of this money to come in the form of grants and other forms of affordable financial support, because market-based loans threaten to deepen their debt burdens.

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The agreement was approved over the objections of India, whose delegates raised their hands in an attempt to intervene, and with the hammer falling, took to the stage in a failed attempt to attract attention.

Indian representative Chandni Raina described the agreement as insufficient. He described the deal as insufficient. “The goal is too small, too far,” she said, her speech often punctuated by applause and cheers.

However, for some, the outcome is likely to serve as evidence that the COP process remains the best approach to coordinating global action to address the escalating challenges of climate change.

“The UN Climate Change Conference (COP29) took place in difficult circumstances, but multilateralism remains alive and more necessary than ever,” said Lawrence Tubiana, CEO of the European Climate Foundation, architect of the landmark Paris Agreement.

The new agreement will help guide country-by-country commitments to reduce greenhouse gas emissions by 2035 as well as the next round of UN climate talks in Brazil. Many developing countries stressed that the lower-than-hoped-for financial commitment will slow their transition to zero-emission energy and limit their ambition to set carbon reduction targets due in February.

(Updates with comment from the fourth paragraph. A previous version of the news corrected the name of the Indian official)

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