Beyond promises: Why COP29 must secure a $1trn climate finance goal for global action

The impacts of climate change are undeniable, as shown by the devastation caused by floods in Spain, deadly hurricanes in the United States, flooding in Nepal and other extreme weather events worldwide.

With air and sea temperatures rising and climate records continuously shattered, global efforts to address climate change must expand faster than ever before. Put simply, we need seismic shifts, not incremental change.

While copious solutions exist to mitigate, adapt and address loss and damage, the missing piece is finance. Only funding can unlock the urgently needed global climate action.

The upcoming 2024 UN Climate Conference (COP29) is tasked with forging an agreement to establish a new collective quantified goal (NCQG) to provide needed climate finance.

This awkwardly named climate finance goal will likely set the ambition and parameters for climate action for at least the next decade. The stakes could not be higher.

According to the Intergovernmental Panel on Climate Change, limiting warming to around 1.5 degrees Celsius requires global greenhouse gas emissions to peak before 2025 and decrease by 43% by 2030 to prevent irrevocable damage.

The time for change is now. We can either see a robust agreement cementing the needed funding to meet Paris Agreement goals, thus averting a worsening crisis or miss this critical window and further erode any trust left in the multilateral process.

Climate finance is not about charity or generosity but responsibility and justice. It is based firmly on the principle of common but differentiated responsibilities and respective capabilities (enshrined in the Paris Agreement and UN Framework Convention on Climate Change) – those who contributed most to the climate crisis must bear the brunt of the solution.

Yet agreeing on this new financing target has proven difficult.

If developed countries and the fossil fuel industry tackled climate change head-on four decades ago as its impacts became clear, the cost of confronting it today wouldn’t be as staggering – currently, around trillions of dollars.

Many developed countries believe private investment can cover the gap. However, return-seeking finance is inappropriate and unethical in many contexts – particularly for loss and damage, adaptation and less developed countries where the business model is unclear, untested or non-existent. Moreover, to date, private finance has not delivered.

Developed countries also point to multilateral development banks as a source but much of their funding is provided as loans, which could further imperil already highly indebted countries. Moreover, loans are unjust, as developing countries pay back more than they borrow to solve a problem they did not cause.

Currently, 69% of all climate finance is provided in loans, entrenching existing inequalities and exacerbating debt crises in climate-vulnerable poor countries.

The NCQG requires core public grant funding – around $1 trillion annually – directed at developing countries in line with their evolving needs. This funding should be allocated across mitigation, adaptation and loss and damage to prevent the current imbalance, where most funds go towards mitigation.

Is $1 trillion a realistic and achievable number? Only if there are efforts to tap into so-called “innovative sources” of funding and to make polluters and profiteers pay. The money is out there:

Other options are available but the goal must be reframed as non-negotiable and serious conversations must be had about generating new financing reserves.

The needs are so great, the responsibility so clear and the price of inaction so high, that developed countries cannot simply say they have no fiscal space. It’s time to stop promising and finding excuses and start to meet this existential moment head-on.

Many other issues remain regarding the NCQG, such as how to ensure accessibility to countries and communities in need of funding or that it supports programmes prioritizing gender and inclusivity. However, the amount of public finance provision remains the key sticking point and the political football.

Even at this late stage, only days before COP29 starts and despite the many proposals by developing countries, no developed country has so far put an actual number on the table.

To achieve an NCQG reaching $1 trillion that can begin meeting the needs of developing countries, a systemic shift is needed. Such progress requires pressure at the political level from a high-ambition coalition driven by developing countries suffering most from climate change that can stand up to developed countries and reject attempts to shift responsibility.

This effort could echo that led by the Marshall Islands, which led to the 1.5-degree goal in Paris.

Failing to deliver the necessary finance at COP29 would not only stall climate action but also leave vulnerable women, men and children in developing countries footing the bill. At the same time, polluters and profiteers continue to act with impunity.

Humanity cannot afford more empty promises and incremental targets. Countries that caused the climate crisis need to act seriously and boldly to ensure the Paris Agreement goals are reached while there is still time.