International climate change negotiations are kicking off this week in Azerbaijan, with trillions of dollars that will decide the fate of the planet’s warming trajectory set to be negotiated against a global backdrop of worsening extreme weather.
At stake isn’t only the pace of change, which needs to accelerate to avoid catastrophe, but the means of funding some of that change. One approach, experts say, could saddle poor countries with generations of debt, while another could leave rich countries less willing to shoulder the burden.
The election in the United States of Donald Trump last week promises to cast a shadow over the negotiations, called COP29 (short for the 29th meeting of the Conference of the Parties). In Trump’s previous administration, he withdrew the U.S. from the Paris Agreement, and this year said he would do it again after President Joe Biden rejoined the pact. He intends to pursue a policy of boosting oil and gas production that could add four billion tonnes of greenhouse gas emissions to the atmosphere by decade's end — wiping out, twice over, all renewable energy progress made around the world over the last five years, according to an analysis from CarbonBrief.
But not all is lost for climate action, says Matt Hoffmann, a University of Toronto political science professor and co-director of the Environmental Governance Lab. There’s no question it will be much harder to slash global emissions at the pace and scale required to avoid disastrous climate impacts without the world’s largest economy on board, he said, but it’s worth putting into a broader context.
“Trust in the U.S. when it comes to climate change has always been relatively low,” Hoffmann said. “That's not to say all administrations have been the same, because that is just not true, but the U.S. has never really been seen as a leader.”
Adam Scott, executive director of Shift: Action for Pension Wealth and Planet Health, agreed, saying the U.S. has “never been seen as a reliable partner in the U.N. climate process.” He said Trump’s election is still disruptive, but ever since George W. Bush killed the Kyoto Protocol, the country’s leadership has often been obstructionist on international climate negotiations, a stance Trump only took further.
“A lot of the leadership has gone to other places,” he said. “The clean energy economy is really being driven much more by China internationally.”
This year’s summit will involve debates over rules around international carbon offset trading, adapting to climate change and cutting emissions, but the most important topic will be finance. On the agenda is a “new collective quantified goal” – U.N. jargon for how much money rich countries will provide poorer countries to respond to the climate crisis.
Climate finance is the “linchpin” to international climate diplomacy, Hoffmann said. Without cash on the table, poorer countries are unwilling to commit to steeper emissions reductions. With new, more ambitious emission-reduction targets required under the Paris Agreement to be submitted next year, agreeing on how much money will be made available is essential, if those new targets are to be strong enough.
To get all countries to agree to the Paris Agreement, including poorer countries with little historic responsibility for the polluted atmosphere compared to countries that industrialized with fossil fuels to generate tremendous wealth, nations agreed that finance would have to flow from rich to poor to help decarbonize and deal with climate impacts.
The new financing target under negotiation this year is to replace a previous promise rich countries made in 2009 to provide US$100 billion per year by 2020. That goal was met in 2022, according to the latest figures, and the new financing target is intended to replace the $100 billion commitment with even more cash — as much as ten times more.
Canada could have an important role to play in the financing negotiations. Since 2021, Canada and Germany have been tapped by successive COP presidencies to help deliver the $100-billion commitment after it fell behind schedule. Filling the finance gap helps pave the way for more ambitious outcomes from these summits, including last year’s conference which committed countries to phasing out fossil fuels – the first time coal, oil and gas were directly named.
Environment and Climate Change Minister Steven Guilbeault will attend the first week of COP29, but not the second. In an interview with Canada’s National Observer, he said his partial attendance is because the first week of COP29 is a non-sitting week in the House of Commons, but he has to be back in Ottawa “because of the silliness of what's happening in the House right now.”
Since he became environment minister in 2021, he has been on the ground of the COPs the entire time, which allowed Canada to play an active bridge-building role, experts say. This year, that appears far less likely.
“The uncertain position of the governing party moving into an election year is not super conducive to having a lot of effect on international issues, just because people see the writing on the wall of a potential reversal,” Hoffmann said. (The same applies to the U.S., with a lame duck president awaiting his replacement.) “It's definitely not a great look if you want to be building bridges, because it's signalling instability in what the future of climate policy and climate cooperation looks like coming out of Canada.”
Scott told Canada’s National Observer that, as a middle power with good diplomatic ties, Canada should be an important player at the negotiations. But if Guilbeault can’t play the same active role he did in previous summits, it will be even more important to see Canada step up with financial commitments.
Canada “has a really large obligation to provide public financing… and we've never really quite lived up to the requirement there,” Scott said. “We've always been dragged in late to the process to commit our full fair share.”
He said Canada could lead by being one of the first countries to pledge significant dollars to the new financing target.
“That's the sort of thing that unlocks other countries to do the same,” he said.
At this point, several proposals for the new financing target exist. Some developing countries want to see a new target of at least $1 trillion provided each year, while rich countries, including Canada, have not put forward dollar figure targets and instead are focused on trying to unleash the private sector and expand the country donor base — making other nations that are rich, but still considered “developing” in the U.N. system (like China, Saudi Arabia, the United Arab Emirates) step up more.
This promises to be a fierce debate because trillions of dollars are on the line that will shape countries’ development and ability to respond to climate change for the next decade at least. Essentially, will vulnerable countries be provided the money to leapfrog carbon intensive development without being saddled with further debt, or will Global North companies pounce on countries to extract significant profit out of their desperate need to transition off fossil fuels?
Hoffmann said Global North countries’ opening gambit is always to increase the donor base to include more countries, while trying to spur private finance because of raw national interest.
“The countries of the Global North would like to get a stable climate as cheaply as possible, and so, the more they don't have to pay out of the public coffers, the better,” he said. “They're always going to be trying to minimize what they pledge [and] find the lowest amount that will work.
“But I think it's important to think about this in a larger context of questions of responsibility.”
The record is clear: rich, Western countries bear the lion’s share of responsibility for historic emissions. The climate crisis is caused by the long-term accumulation of greenhouse gases in the atmosphere, leading some to argue that a country’s total emissions over time are more impactful from a planetary perspective than annual emissions. This is why a key principle in international negotiations is “common but differentiated responsibilities” — a term meant to reflect that climate change is a global issue, and not every country has equal responsibility to address it.
“This climate finance question gets at the nexus of straight-up national economic interests… and broader moral and responsibility debates that the Global North doesn't really want to touch,” Hoffmann said.
Scott said global climate diplomacy rests on wealthy countries providing the money, but the stakes are especially high now because many countries are rapidly electrifying. Without the financing to make sure that electricity is generated from renewable sources, countries are more likely to turn to cheap, dirty coal.
“We're staring down the barrel of two completely different pathways. One that follows the clean energy pathway and one that doesn't,” he said.
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