Climate talks urged to find $1 trillion a year for poorer countries
Experts at the COP29 climate summit in Azerbaijan have issued a stark warning: countries must act now to provide financial support to developing nations or face significantly higher costs later. According to a report released on Thursday by the Independent High-Level Expert Group on Climate Finance, poor countries need at least $1 trillion annually by the end of the decade to transition to greener energy and protect against extreme weather events.
The financial crisis facing developing countries is a central topic at the ongoing talks in Baku, with negotiators scrambling to reach a deal on future climate finance. The summit’s success will be measured by whether wealthier nations, development banks, and the private sector can agree on a new funding target to support climate action in poorer countries.
A previous commitment to provide $100 billion annually to developing nations, set to expire in 2025, was not fully met until 2022—two years behind schedule. The OECD reported that much of the funding was provided as loans, rather than grants, which has been a point of contention among recipient countries.
The new report suggests that the annual target should increase to $1.3 trillion by 2035 to avoid a steep and costly climb toward climate stability. The experts warn that any shortfall in funding before 2030 will create additional pressure in the years to follow, raising the cost of mitigating the effects of climate change.
“The less the world achieves now, the more we will need to invest later,” the report states, underscoring the urgency of financial commitments.
Behind closed doors, negotiators are still hashing out the details of a potential agreement. Early drafts of the financing text reveal deep divisions among countries, with little consensus on how to proceed. Some negotiators have criticized the current draft as too lengthy, and are waiting for a more streamlined version before substantive talks can begin.
A major point of contention is the unwillingness of many Western nations to increase their financial contributions unless large emitters like China agree to share the burden. The potential withdrawal of the United States from future funding agreements under an incoming Trump administration has further complicated negotiations, leaving delegates searching for alternative ways to secure the necessary funding.
Multilateral development banks, such as the World Bank, have already signaled their intent to ramp up climate financing by roughly 60%, aiming for $120 billion annually by 2030. Additionally, the private sector is expected to contribute at least $65 billion to the effort.
There is also growing momentum behind a proposal to raise funds by taxing polluting industries, including aviation, fossil fuels, and shipping, as well as financial transactions. While more countries have signaled support for this idea, any concrete agreement is unlikely at this summit.
In a notable announcement on Thursday, Zakir Nuriyev, head of Azerbaijan’s Association of Banks, revealed that the country’s 22 banks would commit nearly $1.2 billion toward projects that will help Azerbaijan transition to a low-carbon economy.
Diplomatic tensions at COP29
Despite the focus on climate finance, the summit has been marked by diplomatic tensions. French climate minister Agnès Pannier-Runacher canceled her trip to Baku after Azerbaijan’s President Ilham Aliyev accused France of “crimes” in its overseas territories in the Caribbean. Aliyev also criticized France for its support of Armenia, Azerbaijan’s regional rival.
“The voices of these communities are often brutally suppressed by the regimes in their metropolis,” Aliyev said in his remarks, further escalating tensions between the two nations.
European Union climate commissioner Wopke Hoekstra responded, emphasizing that COP should remain a space for constructive negotiations, regardless of bilateral disputes. “The COP Presidency has a particular responsibility to enable and enhance that,” Hoekstra said in a statement on X.
Additionally, Argentina’s delegation made an unexpected withdrawal from the negotiations, although the reasons for their departure remain unclear. President Javier Milei has previously dismissed global warming as a hoax, raising questions about Argentina’s commitment to the summit’s goals.
With just a few days remaining, the focus remains on whether negotiators can bridge the divides and secure meaningful financial commitments to help vulnerable countries cope with the climate crisis. The stakes have never been higher, and the world is watching.
