Climate finance to triple

But it still will be too little, too late

One of the main conclusions of COP 29 in Azerbaijan was that climate finance for developing countries will be tripled to $300 billion per year from 2035 (the existing goal, which was only met in 2022, was $100 billion per year).

This amount will be mobilized with the "leadership" of developed countries, but some developing countries are invited to contribute as well. It was an anomaly derived from the world's classification in 1992 that countries such as Bulgaria, which has a GDP per capita of $15,800, is considered a "developed country", while countries such as Qatar or Singapore, with a GDP per capita of $87,000 and $84,000 respectively, are considered "developing countries".

It is also worth mentioning that currently the country with the most greenhouse gas (GHG) emissions is China, which emits 27% of the total, and which has even surpassed the European Union in per capita emissions. And yet it is not required to provide climate finance.

The aim is to mobilize $1.3 trillion in climate finance from all sources (public and private), which is the estimated amount required by developing countries (excluding China) to address climate change mitigation and adaptation.

Prominent economic analyst Martin Wolf of the Financial Times noted that to some extent the outcome of COP29 could be seen as a failure or a disaster; given that climate change is a global problem, and that most developing countries do not have access to the international financial market, the agreed amount is "too little, too late."

The world has already surpassed the global temperature increase of 1.5 degrees C since pre-industrial times in 2024, as a new temperature record was set. Three experts, Rockström, Kleinnijenhuis and Bolton, say that the world is already in a "climate emergency", and that GHG emissions need to be reduced by 7.5% per year. This would require a radical change from recent trends. Therefore, they say, it is “necessary to mobilise climate finance now – starting at full scale in 2025 – not ‘by 2035′".

By surpassing the 1.5-degree barrier, they say, "we are in danger of crossing four irreversible tipping points: collapse of the Greenland and West Antarctic ice sheets; abrupt thawing of the permafrost; death of all tropical coral reef systems; and collapse of the Labrador Sea current. All this would put us in a new and very dangerous world."

The technology exists to replace fossil fuels with renewable energy, and in fact the costs of clean energy are now lower than those of traditional energy. Therefore, the solution, Wolf says, is for citizens of rich countries to subsidize the clean energy transition of developing countries.

According to Rockström et al., this would require non-reimbursable grants (or "grant equivalent" concessional loans) of about $256 billion per year. "Yes, this is a big sum. But it is only just over a quarter of the US defence budget and 0.3 per cent of the total GDP of the high-income countries. We have long enjoyed the use of our atmosphere as a free sink. It is past time for us to invest in its health, instead."

One factor that will complicate this process is the election of Donald Trump in the United States. He has said he will again withdraw the U.S. from the Paris Agreement, and that he will remove the Biden administration's subsidies for electric vehicles and renewable energy. In his previous government he also suspended contributions to the Green Climate Fund (GCF). Elon Musk may convince him otherwise (even the head of the oil company Exxon has suggested that the U.S. should remain in the Paris Agreement); but it may also be that Trump indulges the interests of the fossil fuel industry and his Russian and Arab allies.

At COP29, contributions of $760 million were announced for the new Loss and Damage Fund; $763 million for the Green Climate Fund (part of the $13.6 billion replenishment made in 2023-24) and $131 million for the Adaptation Fund.