Released November 26, 2024 | SUGAR LAND
en
Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--The delegates to the COP29 climate summit have all departed Baku, Azerbaijan, leaving behind a mixed legacy. Representatives of wealthier Global North countries pointed to an adopted goal of tripling, to $300 billion, climate finance aid to less-wealthy Global South nations by 2035. But officials from Global South nations decried the amount as too little and too late to fully address the threat climate change posed to their countries and people.
Speaking about the $300 billion fund by 2035, Ed Miliband, U.K. energy secretary, told reporters, "We've got new countries that haven't contributed before, like China, and that's important."
President Joe Biden, in a statement, said the climate finance deal was "another historic outcome. In Baku, the United States challenged countries to make an urgent choice: either consign vulnerable communities to ever more catastrophic climate disasters, or step up and place all of us on a safer path toward a better future. Together, countries set an ambitious 2035 international climate finance goal. It will help mobilize the level of finance--from all sources--that developing countries need to accelerate the transition to clean, sustainable economies, while opening up new markets for American-made electric vehicles, batteries and other products."
The response from Global South nations was considerably less upbeat. "What we were demanding was $1.3 trillion, 1% of global GNP, and what we got was $300 billion," Juan Carlos Monterrey Gómez, special representative for climate change at Panama's environment ministry, told reporters after the final text was issued over the weekend. Representatives of India's delegation called the deal "a paltry sum." Banners unfurled at the event called on wealthier nations to "pay up."
Critics also noted that the $300 billion by 2035 goal is non-binding.
Even the summit's own communique on climate finance called attention to the significant gap between the level of climate finance aid that was needed and what was pledged. It highlighted "that costed needs ... of developing country parties are estimated at $5.1 trillion to $6.8 trillion until 2030." It "notes with concern the gap between climate finance flows and needs, particularly for adaptation in developing country parties."
Striking a climate finance deal was one of the top priorities of COP29. But the summit requires all final commitments to be adopted unanimously by the nearly 200 nations that signed the 2015 Paris Agreement, making a $1.3 trillion commitment unlikely.
In the final communique on climate finance, nations "set a goal ... with developed country parties taking the lead, of at least $300 billion per year by 2035 for developing country parties for climate action." The funding will ramp up to at least $300 billion by 2035 and shall come from a wide variety of sources, public and private, bilateral and multilateral, including alternative sources. It also "encourages developing country parties to make contributions, including through South--South cooperation, on a voluntary basis."
In 2009, the U.N. climate change summit agreed to contribute $100 billion to fighting climate change in the developing world by 2020. That level of financial aid was reached in 2022. The funds will go to decarbonizing the Global South's energy supply, remediating the effects of climate change and making those countries more resilient to climate change.
Back when the climate finance idea was first included as a topic at the U.N. climate summit in 2009, China was considered a "developing" nation. Now, China is the world's largest economy, according to an estimate from the U.S. Central Intelligence Agency, at about $31.2 trillion. The U.S. is the world's second-largest economy, with GDP of about $25 trillion in 2023, the CIA "Factbook" said.
That's why Global North delegates heralded the inclusion of China in the group of countries that will pay into the $300 billion climate change by 2035 fund.
Geoffrey S. Lakings, an IIR Energy senior strategist, was not particularly surprised by the divisions. "Countries representing half the world's GDP will vote on national leaders this year, and the world is primarily focused on energy, economic security and migration. Compared to these concerns, environment, climate and sustainability have taken a back seat."
Lakings added that while the Global North's commitment has tripled, to $300 billion, "it's nowhere near the $2 trillion+ that is needed."
"World leaders, for the most part, outside of a few in the G20, are committed to hydrocarbons powering tomorrow," he continued. "Regardless of what science might be saying, they believe the world will be just fine. 'There's nothing to see here' in regards to biodiversity loss, major storms, sea level rise, etc.--this is all but a global geologic cycle we are going through."
Those with a literary bent to characterize the COP29 climate finance deal might invoke a line in "Macbeth" made more famous by William Faulkner: "Full of sound and fury, signifying nothing."
One reason for that pessimism is that Donald Trump, a climate change denier, was elected president this month. He has vowed to pull the U.S. out of the Paris Agreement, as he did in his first term. That action would take one year to become effective. Trump's election hung like a wet blanket over the two-week COP29, news reports said.
Although it was not immediately clear which nations of the Global North would contribute what sums to the new $300 billion-by-2035 kitty, and when those sums would be due, it is clear the U.S. government will not be making a contribution under Trump's presidency. That's not to say U.S.-based financial institutions won't contribute, or that Trump's decision won't be reversed by a Democratic successor. But over the 2025-2029 period, one of the world's largest economies will make no contributions.
Even President Biden's attempt to accentuate the positive might prove to be elusive. In his statement over the weekend, he referenced "opening up new markets for American-made electric vehicles, batteries and other products." That could be undone by the incoming president's threat to impose tariffs on foreign-made goods. Those tariffs could spark countervailing actions against U.S.-made goods, which could cut into American companies' ability to sell their goods overseas.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
Speaking about the $300 billion fund by 2035, Ed Miliband, U.K. energy secretary, told reporters, "We've got new countries that haven't contributed before, like China, and that's important."
President Joe Biden, in a statement, said the climate finance deal was "another historic outcome. In Baku, the United States challenged countries to make an urgent choice: either consign vulnerable communities to ever more catastrophic climate disasters, or step up and place all of us on a safer path toward a better future. Together, countries set an ambitious 2035 international climate finance goal. It will help mobilize the level of finance--from all sources--that developing countries need to accelerate the transition to clean, sustainable economies, while opening up new markets for American-made electric vehicles, batteries and other products."
The response from Global South nations was considerably less upbeat. "What we were demanding was $1.3 trillion, 1% of global GNP, and what we got was $300 billion," Juan Carlos Monterrey Gómez, special representative for climate change at Panama's environment ministry, told reporters after the final text was issued over the weekend. Representatives of India's delegation called the deal "a paltry sum." Banners unfurled at the event called on wealthier nations to "pay up."
Critics also noted that the $300 billion by 2035 goal is non-binding.
Even the summit's own communique on climate finance called attention to the significant gap between the level of climate finance aid that was needed and what was pledged. It highlighted "that costed needs ... of developing country parties are estimated at $5.1 trillion to $6.8 trillion until 2030." It "notes with concern the gap between climate finance flows and needs, particularly for adaptation in developing country parties."
Striking a climate finance deal was one of the top priorities of COP29. But the summit requires all final commitments to be adopted unanimously by the nearly 200 nations that signed the 2015 Paris Agreement, making a $1.3 trillion commitment unlikely.
In the final communique on climate finance, nations "set a goal ... with developed country parties taking the lead, of at least $300 billion per year by 2035 for developing country parties for climate action." The funding will ramp up to at least $300 billion by 2035 and shall come from a wide variety of sources, public and private, bilateral and multilateral, including alternative sources. It also "encourages developing country parties to make contributions, including through South--South cooperation, on a voluntary basis."
In 2009, the U.N. climate change summit agreed to contribute $100 billion to fighting climate change in the developing world by 2020. That level of financial aid was reached in 2022. The funds will go to decarbonizing the Global South's energy supply, remediating the effects of climate change and making those countries more resilient to climate change.
Back when the climate finance idea was first included as a topic at the U.N. climate summit in 2009, China was considered a "developing" nation. Now, China is the world's largest economy, according to an estimate from the U.S. Central Intelligence Agency, at about $31.2 trillion. The U.S. is the world's second-largest economy, with GDP of about $25 trillion in 2023, the CIA "Factbook" said.
That's why Global North delegates heralded the inclusion of China in the group of countries that will pay into the $300 billion climate change by 2035 fund.
Geoffrey S. Lakings, an IIR Energy senior strategist, was not particularly surprised by the divisions. "Countries representing half the world's GDP will vote on national leaders this year, and the world is primarily focused on energy, economic security and migration. Compared to these concerns, environment, climate and sustainability have taken a back seat."
Lakings added that while the Global North's commitment has tripled, to $300 billion, "it's nowhere near the $2 trillion+ that is needed."
"World leaders, for the most part, outside of a few in the G20, are committed to hydrocarbons powering tomorrow," he continued. "Regardless of what science might be saying, they believe the world will be just fine. 'There's nothing to see here' in regards to biodiversity loss, major storms, sea level rise, etc.--this is all but a global geologic cycle we are going through."
Those with a literary bent to characterize the COP29 climate finance deal might invoke a line in "Macbeth" made more famous by William Faulkner: "Full of sound and fury, signifying nothing."
One reason for that pessimism is that Donald Trump, a climate change denier, was elected president this month. He has vowed to pull the U.S. out of the Paris Agreement, as he did in his first term. That action would take one year to become effective. Trump's election hung like a wet blanket over the two-week COP29, news reports said.
Although it was not immediately clear which nations of the Global North would contribute what sums to the new $300 billion-by-2035 kitty, and when those sums would be due, it is clear the U.S. government will not be making a contribution under Trump's presidency. That's not to say U.S.-based financial institutions won't contribute, or that Trump's decision won't be reversed by a Democratic successor. But over the 2025-2029 period, one of the world's largest economies will make no contributions.
Even President Biden's attempt to accentuate the positive might prove to be elusive. In his statement over the weekend, he referenced "opening up new markets for American-made electric vehicles, batteries and other products." That could be undone by the incoming president's threat to impose tariffs on foreign-made goods. Those tariffs could spark countervailing actions against U.S.-made goods, which could cut into American companies' ability to sell their goods overseas.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
