Written by Kate Abnett, Valery Borkovich, Nailia Bagirova
BAKU (Reuters) – The European Union, the United States and other rich countries at the COP29 summit pledged to increase climate finance by 3,000 yen per year by 2035 to help developing countries tackle climate change. They agreed to raise the price to $1 billion, sources told Reuters on Saturday. Previous proposals were rejected as insultingly low.
The summit was due to end on Friday, but went into overtime as negotiators from around 200 countries, who must unanimously adopt the deal, tried to reach agreement on a climate finance plan for the next 10 years.
On Friday, a $250 billion deal drafted by Azerbaijan, which holds the COP29 presidency, was deemed woefully inadequate by developing countries.
It was not clear whether the revised position of rich countries was formally communicated to developing countries at the meeting in Azerbaijan’s capital, Baku, or whether it was enough to win their support.
COP29 talks highlighted the divide between wealthy governments constrained by tight domestic budgets and developing countries reeling from the soaring costs of storms, floods and droughts caused by climate change.
Past failures to meet climate finance obligations have also left developing countries unsure of new commitments.
The new target aims to replace previous commitments by rich countries to provide $100 billion a year in climate finance to poorer countries by 2020. This goal will be achieved in 2022, two years later, and will expire in 2025.
The EU has agreed to accept a higher figure of $300 billion a year, five people familiar with the private talks said. The United States, Australia and Britain are also participating, two people familiar with the matter said.
Both a European Commission spokesperson and an Australian government spokesperson declined to comment on the negotiations. The US delegation to COP29 and the UK Department of Energy did not respond to requests for comment.
There was still no formal update of the draft agreement from the COP29 Presidency, and the atmosphere among the negotiating groups was tense.
“The way forward is not clear, nor is the political will needed to get out of this situation,” said Juan Carlos Monterrey Gómez, Panama’s chief negotiator.
Three negotiators said the atmosphere in the room was angry.
Sierra Leone’s Environment Minister Abdullahi Jiwo declined to comment on the $300 billion figure, saying: “We are still reviewing the numbers with other political parties.”
Aiming for $390 billion
Brazil’s Environment and Climate Change Minister Marina Silva said on Friday that the Amazon (NASDAQ:) rainforest nation, which will host next year’s COP30 climate change summit, will seek $390 billion in annual aid from developed countries by 2035. He said that
“We cannot leave Baku without a decision to respond to the challenges we face,” she said through an interpreter. “To achieve this goal, we need to reach $300 billion by 2030 and a further $390 billion by 2035.”
Participants were awaiting a new draft of the agreement after negotiators worked through the night to bridge major gaps in positions. Any transaction will require an agreement on more than the total amount.
Negotiators have spent the two-week summit working to address other key questions about the goal, including who will be required to contribute and how much of the funding will come on a grant basis rather than loans.
The list of countries required to participate – around 20 developed countries, including the US, European countries and Canada – dates back to a list decided during the 1992 UN climate change talks.
European governments are calling on other countries, including China, the world’s second-largest economy, and oil-rich Gulf states to join in providing funding.
Donald Trump’s victory in this month’s US presidential election has cast a dark cloud over the Baku talks. Trump, who takes office in January, has once again pledged to remove the United States from international cooperation on climate change, and negotiators from other wealthy countries say that under Trump, the world’s largest economy will not be able to secure climate financing. I predict they won’t put any money into the target.
The draft agreement released Friday includes a broad goal of raising $1.3 trillion a year in climate finance by 2035, including funding from all public and private sources. Economists say that’s about the amount needed.
Poor countries have warned that a weak fiscal agreement at COP29 will undermine their ability to set more ambitious targets to cut greenhouse gas emissions that cause climate change.
