The Finance COP at Baku came to a disappointing conclusion on Sunday with developed nations pledging $300 billion, a fraction of the targeted $1.3 trillion. Though the pledge triples the previous $100 billion commitment it falls way short of the infusion required to invigorate global climate action.
The 200 countries assembled at Baku for COP29 stuck to the script of focusing on climate finance but went disappointingly awry on the targets. Instead of the expected $1.3 trillion in annual financial support for developing countries by 2035, all that the conference managed to extract from the ‘rich nations’ was a paltry $300 billion, leaving the third world seething in frustration.
The New Collective Quantified Goal on Climate Finance (NCQG) has invited sharp criticism from developing nations with India calling it an ‘optical illusion’. Expressing the country’s objection to the manner in which the controversial NCGQ deal was adopted at the COP, India’s representative, Chandni Raina, said: “We have seen what you have done… gaveling and ignoring parties from speaking does not befit the UNFCCC’s system…We absolutely object to this unfair means, followed for adoption.”
In a placatory response, the final COP 2019 text introduced the "Baku to Belem Roadmap to 1.3T," a plan designed to scale up climate finance to $1.3 trillion in time. Despite this, concerns persist about the lack of near-term funding and the ability of developing nations to accelerate climate action.
Many low-income countries face grim economic challenges, including debt management and financial instability, making access to climate finance crucial. Moreover, the failure of developed nations to meet the previous $100 billion annual target, undermines trust and exacerbates the divide.
Simon Steill, Executive Secretary of UN Climate Change, underscored the importance of meeting commitments: "This new financial goal is an insurance policy for humanity amid worsening climate impacts. But like any insurance policy it only works if premiums are paid on time. Promises must be kept to protect billions of lives.”
Dr Arunabha Ghosh, CEO of the Council of Energy, Environment and Water (CEEW) criticised the $300 billion goal as inadequate. “With the world needing over $1.3 trillion by 2030, the agreement on $300 billion by 2035 is a mere fig leaf for inaction. Instead of delivery of genuine support, we see recycled promises."
Sustainable finance expert, Viswajit Srinivasan highlighted a potential strategy to bridge the gap through private capital but with an important caveat: "The EU may see the $300 billion as a way to crowd in private investment and eventually reach the $1.3 trillion goal. However the viability of this depends on the structure and costs of blended finance. Without clarity developing Nations concerns are justified."
Dr Miniya Chatterji, CEO of Sustain Labs Paris noted that the timeline delays crucial support for vulnerable nations: "The $300 billion fund implies that developing countries must wait until 2035 for adequate support. Though it represents some progress, this limited budget increases pressure on nations most at risk."
While the $300 billion commitment may help the word maintain the momentum of clean energy investments the absence of clear mechanisms and sources of funding raises serious concerns. Without a concrete road map, the goal risks remaining symbolic rather than transformative.
The coming months will be crucial as developing nations push for clarity and accountability. The success of future climate finance initiatives will depend on whether developed nations honour their commitments and provide timely, meaningful support.