Climate proposal would see rich countries pay $250B a year

BAKU, Azerbaijan — Organizers of the United Nations climate summit issued a draft agreement Friday that would see the U.S., EU and other wealthy governments provide $250 billion a year in climate finance to developing nations by 2035 — an amount that falls far short of the trillion-plus figure that the poorer countries had sought.
The agreement comes with many uncertainties about which nations would provide exactly how much money, especially with President-elect Donald Trump — who has scoffed at the reality of climate change and vowed steep cuts in government spending — about to take power in the U.S.
The finance question has been the main topic of contention at the COP29 talks in Azerbaijan’s capital. The new target is for money to help poorer nations green their economies and cope with the effects of a heating planet.
Talks had been due to end Friday but were almost certain to go into overtime, given how far apart the parties remain.
“It’s ridiculous. With this number, they are spitting in our faces,” said Panama’s climate envoy Juan Carlos Monterrey Gómez.
“We don’t take that seriously,” said Kenyan climate envoy Ali Mohamed, referring to the $250 billion figure.
Whatever agreed-upon sum comes out of the talks will be a follow-up to a $100 billion target that richer nations agreed to in 2009. They finally met that target two years after a 2020 deadline.
Since then, climate needs and the damage from worsening disasters have grown more expensive and severe. The figure included in the latest draft text is unlikely to appease poorer governments, many of which had already balked at reports in POLITICO that the European Union was internally discussing a range of $200 billion to $300 billion per year.
Blocs of developing countries that negotiate together have sought anywhere from $500 billion to $1.3 trillion annually from wealthier governments’ public funds. The date they want the target to come due is 2030, five years earlier than in Friday’s draft.
“Is this supposed to be the developed countries ‘taking the lead’?” a senior negotiator for a large developing country wrote in a message accompanying a crying emoji.
Several analyses have shown developing countries will need more than $1 trillion annually from outside sources to prevent global temperatures from rising 1.5 degrees Celsius since the mid-19th century, the stretch target that the world’s governments set in the Paris climate agreement. The draft deal indicated that the shortfall, of as much as $1.3 trillion, could be filled largely using private capital by 2035.
The draft is unclear on whether the $250 billion would come only from public funds and private investments they mobilize, or if it also includes all types of private investment. That’s an ambiguity poorer countries want stamped out.
“It’s not gonna go well. The 250 is too low and also ridiculous that it says from both private and public for that one,” said a senior Latin American negotiator who was granted anonymity to discuss the negotiations.
Even though the number fell short of developing countries’ wishes, a European negotiator said it will still strain some rich nations.
“Higher than thought,” said the negotiator, who was granted anonymity to discuss sensitive diplomatic matters. “Some in the group will have to go back to capitals.”
Another European negotiator said that for his country, $250 billion was “a good ballpark figure.”
Senior Biden administration officials have noted they are negotiating a deal that a future Democratic or climate-friendly government could meet. Four years of Trump and at least two years of full Republican control of Congress will likely diminish, if not obliterate, U.S. climate finance contributions, moderating what the U.S. can reasonably achieve.
“It has been a significant lift over the past decade to meet the prior, smaller goal,” a senior U.S. official said in a statement, adding that “$250 billion will require even more ambition and extraordinary reach. This goal will need to be supported by ambitious bilateral action, [multilateral development bank] contributions, and efforts to better mobilize private finance, among other critical factors.”
Environmental organizations said governments can likely hit a loftier number.
Changes already underway to lending practices at multilateral development banks such as the World Bank should free up tens of billions of dollars of more finance that primarily flows from rich to poor countries, Joe Thwaites, senior advocate for international climate finance at the Natural Resources Defense Council, said in a statement. Countries could also reach for “modest increases” in country-to-country finance, he said.
A further major bone of contention at COP29 has been U.S. and European demands that wealthy, but technically still developing, nations, such as China, Singapore and the Gulf states, should also pay into the pot.
The draft essentially left that option up to those countries under pressure to donate, inviting “developing country Parties to make additional contributions” either as part of the goal, or “supplementing” it through what China often calls “South-South” finance.
That represents little change in the stance of China, which came into the talks refusing to budge but also saying that it had provided around $25 billion in total since 2016.