Climate Finance and COP30
Ahead of the COP30 climate meeting in Belem, Brazil, a new report has highlighted the need for developed countries to formulate a clear delivery plan for the promised $300 billion per year in climate finance from 2035 to aid developing nations in combating climate change.
Key Points from the Report
- The report recommends scaling up current levels of grants and concessional finance through bilateral or multilateral channels beyond the promised $300 billion.
- The Report on Baku to Belem Roadmap to 1.3T addresses the dissatisfaction of developing countries with the finance deal finalized during COP29 in Baku, Azerbaijan.
- Developing countries demand at least $1.3 trillion a year in climate finance, though developed countries have only committed to $300 billion from 2035.
Background
- Under the UN Framework Convention on Climate Change and the 2015 Paris Agreement, developed countries are obliged to provide financial support to developing countries.
- This obligation stems from the historical responsibility of developed countries for emitting greenhouse gases over the past 150 years.
Financial Commitments
- Developed countries had promised to raise at least $100 billion annually between 2020 and 2025.
- The Paris Agreement requires this figure to be revised every five years.
- Developing countries, including India, criticized the Baku decision as insufficient.
Future Financial Requirements
- The report estimates $3.2 trillion a year will be required by developing countries in 2035 for climate and nature-related investments.
- Proposed options to raise funds include carbon tax, wealth tax, corporate taxes, aviation taxes, levies on luxury goods, and direct budget contributions from developed countries.
Pathway to $1.3 Trillion
- An Independent High-Level Expert Group has outlined a potential pathway to reach the $1.3 trillion target by 2035.
- The largest portion of the funds, around $650 billion, is expected to come from cross-border private finance, specifically private investments in developing nations.
