Large developing countries reject “$200 billion” climate finance figure
An amount of around $200-300 billion being discussed privately as the international government finance provision towards the new climate finance goal (NCQG) – the main outcome expected at COP29 – has been strongly rejected by large developing countries.
Speaking at a stocktaking plenary this Wednesday, Bolivian negotiator Diego Pacheco said on behalf of the Like-Minded Developing Countries (LMDC) group – which includes big emerging economies like China and India – that the figure was unacceptable.
“We are unable to fathom this $200 billion to step up ambition in developing countries,” said Pacheco. “This is unfathomable. We cannot accept this.”
The Bolivian negotiator also reiterated a refusal by the group to open up the base of climate finance contributors – which developed countries have pushed for – to include China and wealthy Gulf states. “This is a super red line,” emphasised Pacheco.
Coalition against fossil fuel subsidies expands but misses initial targets
With three days to go until COP29 officially ends, developed countries have yet to reveal publicly the amount of public international finance they will put on the negotiating table for the NCQG.
Chris Bowen, Australia’s environment minister who is jointly tasked with facilitating discussions on the NCQG, reported back to the plenary that the figures being discussed for government provision to an overall “mobilised” goal of $1.3 trillion included $440 billion, $600 billion and $900 billion – amounts that have been proposed by developing countries.
Co-chair Yasmine Fouad, Egypt’s environment minister, said discussions on the “structure” of the climate finance goal are “still hearing diverging views”. These refer to the different types of finance that can be counted towards the goal – controversially, including private investments.
Negotiators will now reconvene for further consultations until 5pm local time, and are tasked with producing new texts on finance and other issues by midnight today, the COP29 presidency said.
Stephen Cornelius, WWF’s deputy global climate and energy lead, said that with the COP29 “end game” fast approaching, “we are still missing urgency from the negotiations”.
“All the difficult issues – how much climate finance, who pays it and who can receive it, as well as mitigation and adaptation – remain unresolved. These issues need political guidance as well as more technical work,” he added.
He urged the COP29 presidency to exercise “authority and diplomacy” to find an ambitious common ground by Friday, when the summit is due to close.
Cuban negotiator Pedro Luis Pedroso (left) and Bolivian negotiator Diego Pacheco (centre) in discussions at the COP29 opening plenary last week (Picture: Kiara Worth/UNFCCC)
“Divide in the room” on technicalities of carbon markets
The ministers in charge of looking for a compromise on UN carbon trading negotiations told the stock-taking plenary on Wednesday morning there is still a “divide in the room” on many of the thorniest issues after their first round of consultations.
Much of the focus is on the rules governing Article 6.2 of the Paris Agreement which establishes bilateral exchanges of emission reductions or removals between countries.
In Baku, governments are arguing over what appear to be complex and deeply technical issues but ones that will have profound repercussions over the transparency, integrity and equity of the new mechanism.
One of the major stand-offs is over the purpose of an international registry for Article 6.2 to be set up by the UNFCCC.
A group of developed nations, led predominantly by the United States and Japan, want a light-touch registry that serves a pure “accounting” purpose, recording transactions of carbon credits that take place elsewhere.
But many developing countries, including the African group, small island states, Latin American nations and the least developed countries, insist that the registry’s functions should go further.
They want to be able to transfer and hold carbon credits directly on it. That’s primarily because many among their ranks might not have the means to establish their own national registry, limiting their ability to use the mechanism without a fully-fledged international one.
Carbon market watchers have also pointed out that, without being able to transact on the international registry, poorer countries will likely have to rely on third-party platforms currently used in the voluntary carbon market (VCM). They have raised concerns over what that could mean for environmental integrity and the protection of human rights given the VCM’s lacklustre record on those fronts.
Grace Fu, Singapore’s environment minister, said on Wednesday that a “potential landing zone” could be to explore a “dual layer registry system”. Under this plan, the international registry would only track and record credit exchanges, without a trading functionality. But, she added, the UNFCCC could provide an “optional service” outside of Article 6.2 for countries that need to perform transactions.
Besides the registry question, New Zealand’s Simon Watts added that there are “divergent views” on what information countries need to provide on the bilateral carbon credit exchanges before those take place and on how to deal with so-called “inconsistencies” – meaning any problems with the carbon credits, ranging from a typo in a document to serious integrity issues.
New texts on both Article 6.2 and Article 6.4 – the basis for the new UN carbon market – have been published and ministers will continue consultations with all country groups until the end of Wednesday trying to bridge those divisions.
Australia and New Zealand pledge loss and damage cash
Australia and New Zealand have made pledges to the Fund for Responding to Loss and Damage (FRLD), with Australian ministers saying the move showed they were “standing with Pacific partners”.
Australian climate minister Chris Bowen announced a contribution of AU$50 million ($32.5m) on Tuesday – the biggest donation to the fund this year after Sweden gave $18.4m last week.
“Australia is committed to supporting Pacific priorities and welcomes Pacific leadership to drive climate action, including on responding to loss and damage,” Bowen said in a government statement in which he and two other ministers all referenced the Pacific islands.
Australia is bidding to co-host the COP31 climate talks in two years’ time with a Pacific island nation or series of nations. But Turkiye is also trying to win the support of the UN’s “Western Europe and Others” group of nations, whose turn it is to choose the host country.
New Zealand’s climate minister Simon Watts announced a pledge of NZ$10m ($6m). “Addressing loss and damage from climate impacts that go beyond the limits of adaptation is a high priority for New Zealand and the Pacific as we need to support resilience in the region,” he said.
The new pledges bring the amounts donated to the FRLD to a total of $85m this year, on top of a first round of pledges adding up to $664m at last year’s COP28, meaning the fund has around $750m to spend when it gets up and running in 2026.