COP29 hosts: Climate pact needs 'hundreds of billions' in state money

 

This photo shows a general view of the South Luzon Thermal Energy Corporation power plant in the municipality of Calaca, Batangas, south of Manila on October 8, 2024. A few dozen kilometres from the Philippine capital Manila sits a coal plant that some hope could be a model for how developing countries can quit the polluting fossil fuel. [AFP]

The hosts of the coming UN climate summit said Monday that a hard-fought finance pact for poorer countries must include "hundreds of billions" of dollars from wealthy governments.

Nearly 200 countries are supposed to agree at COP29 how much money should flow every year from rich nations to poorer ones to help them prepare for climate change.

But little progress has been achieved so far in the negotiations, with disagreements over who should pay, how much, and the scope and structure of the pact.

COP29 hosts Azerbaijan held a series of meetings last week with diplomats to try to make headway ahead of the main summit starting on November 11.

Yalchin Rafiyev, Azerbaijan's lead climate negotiator, said "common messages" had started to emerge from the parties, including in terms of the overall size of the finance target.

"It needs to be ambitious, and that needs are in the space of trillions, with a realistic provision and mobilisation needing to be in the hundreds of billions," he told reporters during a conference call.

The call for hundreds of billions of dollars was "a realistic goal for what the public sector could directly provide and mobilise", the COP29 presidency added in a statement.

That annual commitment should cover the decade until 2035.

The existing pledge of $100 billion a year, which expires in 2025, is paid by rich, industrialised countries including the United States, the European Union, Japan and others.

These countries, which have contributed the most historically to global warming, have agreed to keep paying climate finance.

But some are facing austerity measures, and together they have resisted pressure to carry the whole cost on their budgets alone, with calls for other wealthy countries to share the burden.

They have pushed for a layered approach to the new finance deal that envisions government money at the centre, built upon by others including multilateral lenders and the private sector.

Developing countries have pushed government grants to comprise the bulk of climate finance under the new deal, saying loans compound their debt problems.

A new draft deal is expected soon and will form the basis of discussion during the two-week COP29 negotiations in Baku, the seaside capital of Azerbaijan.

"We have done well to narrow down options, and the possible shapes of landing zones are coming into view. But we can clearly see the divides that the parties still need to bridge," said COP29 president Mukhtar Babayev.