“We are talking about talking”: frustrations rise at COP29 over climate finance goals

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“We have communities and people still at the edge of fragility. But at the area with which was inundated mostly, which is in my province of Sindh, in near the coastal areas there, the government – the provincial government – has launched a huge resilience project with with housing for 2.1 million people. It’s taking its time; we are having to rebuild infrastructure and resilient infrastructure is $4 to $1, normal infrastructure. So it’s really about the financing gap. We would scale it up if there was more money available.”
That’s Sherry Rehman, the chair of the climate and environment committee in Pakistan’s senate.
She is talking about projects being undertaken by Pakistan to prepare for more natural disasters, as climate change increases their frequency and intensity.
How to pay for these kinds of projects is at the heart of current talks at COP29.
But those discussions don’t appear to be going well, if Simon Stiell from the UN Framework Convention on Climate Change is any guide.
“I’m kind of seeing some glum faces. There should be some energy in this room. And if we’re to drive that, those finance flows, it needs energy from many of you here.”
The mood is not being helped by public disagreements like the withdrawal of the Argentinian delegation.
Finance negotiator for the Alliance of Small Island States Michai Robertson says there is also pessimism about changes in global politics in China and the US, two of the world’s biggest emitters.
“We’re in a different geopolitical context than we were the first time that (the United States) left (the Paris agreement). A lot of other countries are leaning right? Right. There’s less sort of ability for us and sort of camaraderie amongst the international community to get things done”.
Amid these tensions, a draft agreement of just a few pages – that was worked on for a year – has been rejected.
The latest draft reportedly has more than 30 pages, including turning to private finance to underwrite climate action – though Marian Paolo of Christian Aid says that means it won’t be needs-based, but profit driven.
Principal EU Climate Policy adviser Jacob Werksman says negotiations are working through these concerns.
“What is the quantum? How much beyond 100 billion for the private sector goal and the private sector money that that immediately mobilises? And how do we capture that broader goal of mobilising private finance that will be essential to meet the trillion dollar needs of developing countries in particular, but the world at large in terms of implementing everyone’s obligations under the Paris Agreement?… It’s hard to see exactly where the landing grounds lie at the moment.”
For some delegates, the larger issue is not where the money is sourced – but how it is delivered.
Over 60 per cent of adaptation finance currently involves loans instead of grants, a share that has been rising.
Ms Rehman says Pakistan is now in a difficult position as far as borrowing money for climate projects goes.
“Right now, we’re spending our own resources. And again, loans from the World Bank. This is what Pakistan is asking for. The prime minister repeatedly said we don’t want more debt to burden us. As it is, the economy faces a shock every time there’s a calamity. So the exhaustion of shock is too much to absorb on our own.”
Pakistan is one of 52 developing countries suffering severe debt problems.
Those 52 nations are collectively home to 40 per cent of all people living in extreme poverty – with half of them among the world’s most climate-vulnerable nations.
Damian Spruce, from Caritas Australia, says financing solutions cannot disadvantage those nations any further.
“We need countries to step up – to be delivering a more ambitious goal for climate finance. And we need to make sure that it is good quality climate finance. That it is delivered as grants and not as loans that will just increase the debt levels of the global South and lead to ongoing economic disasters.”
The United Nations supports these calls for a just approach to lending – but it also says it’s a matter of keeping promises already made on public contributions.
A collective goal was set in Paris in 2015 on climate finance amounting to at least a hundred billion a year.
That goal expires this year, and the UN Secretary General, Antonio Guterres, says not enough has been paid.
He says wealthy countries only met the pledge in full starting in 2022.
“The amount initially pledged [[to loss and damage funds]] is equivalent to the combined annual salaries of the ten most wealthy paid footballers in the world.”
The exact amount of financing required is also an issue.
Nicholas Stern is the co-chair of a special independent group of experts commissioned by the UN secretary general to estimate what’s needed.
“What does it take to deliver on Paris in terms of investment and how do we finance that investment.. Well, that number for emerging markets and developing economies outside China is 2.4 trillion (USD) a year.”
But many Western governments appear to have arrived in Baku reluctant to pledge big sums, and the likely withdrawal of the United States from any future funding deal has raised pressure on delegates to find other ways to secure the money.
The head of the Hungarian Delegation, Veronika Bagi, says there ought to be a way that’s fair to everyone.
“All societies can benefit from a just and equitable green transition, with highlighting that climate action should not be seen as a burden, but as an opportunity for all.”
But Sherry Rehman says many developing nations are frustrated.
The next round of climate plans are due in 2025, and many countries have said they are depending on financing to help meet those targets.
Ms Rehman says the lack of progress on climate finance is getting ridiculous.
“It is quite alarming that at the 29th Conference of Parties meeting, we are still talking in bumper stickers, yet not able to get past them… Again, 29 years later, we are talking about talking.”