Ashraf Engineer
December 7, 2024
EPISODE TRANSCRIPT
Hello and welcome to All Indians Matter. I am Ashraf Engineer.
Yet another COP has flattered only to deceive. Much was expected from COP29, held recently in Baku in Azerbaijan, in terms of solutions for the climate change crisis and the finance needed for them. Instead, the $300 billion annual climate finance deal got the thumbs down from developing nations, who said the amount fell way short of what was needed. The agreement, ostensibly meant to help poor countries cope with climate-related challenges, was widely seen as lacking scope and urgency.
The COP, or Conference of the Parties to the United Nations Framework Convention on Climate Change, is an annual summit for world leaders to work together on climate solutions.
The money, if disbursed, will help the developing world pay for the transition to clean energy from fossil fuels, create the infrastructure needed to deploy technologies like wind and solar power on a large scale, etc.
Developing nations said that the $300 billion, to be paid by 2035, falls drastically short of the $1.3 trillion needed by them. In fact, there is some debate over whether even $1.3 trillion is enough. Campaign groups estimated the financing need at $5 trillion, calculated on the basis of the historic responsibility of developed countries. They said it could be achieved if fossil fuels were taxed properly.
Importantly, the divisions even among developing nations were on display. The Least Developed Countries and Small Island Developing States had varying demands that were not fully addressed. So, questions were raised over whether COPs can effectively deal with climate issues.
Why was COP29 important for India and why is its disappointing outcome a worry?
SIGNATURE TUNE
Trashing the climate deal, Indian negotiator Chandni Raina said: “India does not accept the goal proposal in its present form. The amount that is proposed to be mobilised is abysmally poor. It is a paltry sum. It is not something that will enable conducive climate action that is necessary for the survival of our country.” She was supported by her Nigerian counterpart Nkiruka Maduekwe, who said the $300 billion figure was “a joke” and “an insult” to the provisions of the UN Framework Convention on Climate Change or UNFCCC.
While the figure represents a tripling of the previous $100 billion commitment, it is inadequate and the devil lies in the details. It is a combination of grants and loans, rather than pure grant-based funding. So, developing nations argue, it lacks the financial commitments they need and it puts the burden of finance on them through the repayment clauses.
It was in 2015 that the Paris Agreement mandated that a new goal on finance, called the New Cumulative Quantitative Goal or NCQG, be decided upon before 2025. It, however, did not say from which year the amount would have to be mobilised. Later, developing nations pegged the NCQG at $1.3 trillion per year and at the top of the COP29 agenda was its finalisation.
However, throughout the conference and the three-year negotiation before it, developed countries didn’t reveal their cards and finally offered to raise the $100 billion figure to a mere $250 billion. This led to many developing countries walking out of the meeting and the suspension of talks. Much haggling later, the offer was raised to $300 billion and the demand to disburse it in the form of grants or concessionary loans was rejected.
The nations worst hit by extreme weather changes want more money to tackle events like floods and storms. They also want funding for improving farming practices in accordance with weather changes, to build more resilient housing and infrastructure, and to fund emergency plans.
COP29 underscored a fundamental problem: developed nations, historically responsible for most emissions, have not acted on the scale needed. China, meanwhile, seemed indifferent and Saudi Arabia resorted to pro-fossil fuel obstructionism. Get this: at the conference to deal with climate change, more than 1,700 fossil fuel lobbyists turned up.
The reality, meanwhile, loomed large. Global greenhouse gas emissions are yet to start coming down, rising 0.8% this year. We are hurtling towards 1.5 degrees Celsius of heating in little more than a century and worsening extreme weather is taking a massive toll on lives, livelihoods and the ecosystem.
The simple argument is that wealthy nations must pay to help the poorer ones build clean economies. This is not charity because, as I said, it is the wealthy nations who are largely responsible for the pollution fuelling climate change. But, as is usually the case, the wealthy are resisting a payout and are disputing their level of responsibility.
No matter what stand these nations take, climate plans are urgent and must be financed. The ideas that go beyond government funding include multilateral development banks and taxes on shipping and aviation. However, their feasibility and rollout are unclear. For example, new taxes on shipping would make commodities costlier – much to the detriment of poorer nations.
A better deal would have facilitated more effective climate plans from developing countries. This is especially critical because, at a time of serious geopolitical concerns, the world needs to come together on climate.
Here’s what the Standing Committee on Finance of the UNFCCC had to say: in its Second Needs Determination Report, it assessed that developing countries’ financial needs for climate action by 2030 range between $5 trillion and $6.87 trillion — and this is only 48% of costed needs. The full financial need could be as high as $10.49 trillion to $14.33 trillion. That works out to an annualised cost of $1.75 trillion to $2.39 trillion by 2030. So, the $300 billion target adopted at COP29 is, as the Nigerian negotiator put it, a joke.
What’s worse, this $300 billion is a mobilisation goal, which means it relies on private sector contributions and has no guarantees for grant-based finance. This is seen as an injustice – and rightly so – by developing countries.
As things stand, the COP process is in danger of losing legitimacy and becoming irrelevant. That’s to be expected if it consistently fails to meet its goals and is dominated by richer countries who are unwilling to play their part in solving a problem created largely by them.
As a first step, the finance goal must be revised to one that accurately reflects the need and reality. Also, this funding must significantly scale up grant-based disbursement. Lastly, the decision making cannot be dominated by one bloc.
What most people don’t acknowledge is that climate finance is not about numbers but justice. The global south is least responsible for the crisis but is most affected by it. If the COP is to have meaning or effectiveness, this is where its focus must lie. Otherwise, it may as well shut shop and the world should look elsewhere for solutions.
Thank you all for listening. Please visit allindiansmatter.in for more columns and audio podcasts. You can follow me on Twitter at @AshrafEngineer and @AllIndiansCount. Search for the All Indians Matter page on Facebook. On Instagram, the handle is @AllIndiansMatter. Email me at editor@allindiansmatter.in. Catch you again soon.
