COP 29: Developing countries dismiss $300bn deal as 'optical illusion'

Countries at the COP29 summit in Baku agreed a $300 billion a year global finance target to help poorer nations cope with impacts of climate change, a deal its intended recipients criticized as woefully insufficient.

The agreement, clinched in overtime at the end of the two-week conference in Azerbaijan's capital, Baku, was meant to provide momentum for international efforts to curb global warming in a year destined to be the hottest on record.

Some delegates gave the deal a standing ovation in the COP29 plenary hall. Others lambasted wealthy nations for not doing more and criticized host Azerbaijan for hurriedly pushing through the contentious plan.

"I regret to say that this document is nothing more than an optical illusion," Indian delegation representative Chandni Raina told the closing session of the summit. "This, in our opinion, will not address the enormity of the challenge we all face. Therefore, we oppose the adoption of this document."

United Nations climate chief Simon Stiell acknowledged the difficult negotiations that led to the agreement but hailed the outcome as an insurance policy for humanity against global warming.

"It has been a difficult journey, but we've delivered a deal," Stiell said. "This deal will keep the clean energy boom growing and protect billions of lives.

"But like any insurance policy, it only works if the premiums are paid in full, and on time."

Not sufficient cash for climate emergency

The agreement would provide $300 billion annually by 2035, boosting rich countries' previous commitment to provide $100 billion per year in climate finance by 2020. That earlier goal was met two years late, in 2022, and expires in 2025.

But it falls well short of the $500 billion that some developing countries had demanded at the fraught negotiations in Baku.

Members also warned that the deadline for a decade away in 2035 would hold back the world's transition to clean energy.

Some including India also lambasted wealthy nations for seeking to include contributions by developing countries in the annual target.

The deal states that the money will come directly from a "wide variety of sources" including government budgets, private sector investment, and other financing.

It also cites "alternative sources" - a reference to potential global taxes under discussion on the aviation and maritime industries, and the rich.

The hope is that the money from developed countries will help boost private investment to reach an ambitious goal - written into the deal - of delivering at least $1.3 trillion per year by the next decade.

The deal also lays the groundwork for next year's climate summit, to be held in the Amazon rainforest of Brazil, where countries are meant to map out the next decade of climate action.

U.S. had little to offer

Although he has yet to take office, climate denier Donald Trump's victory in the November 5 presidential election altered the mood at COP29.

Trump has vowed to remove the United States from global climate efforts, and has appointed another climate skeptic as his energy secretary.

Trump's election meant the U.S. could offer little at COP29, despite being the world's biggest historical polluter and most responsible for climate change. It also curtailed ambitions on the finance target, with the world's biggest economy unlikely to contribute.

Carbon credits given go-ahead

After nearly a decade of efforts to establish a rulebook for carbon credits, COP29 reached a deal to allow countries to begin establishing these credits to bring in funding and offset their emissions, or to trade them on a market exchange.

There are still some smaller details to be worked out, such as the registry's structure and transparency obligations. But proponents hoped the boost to carbon offsetting will help draw billions of dollars into new projects to help the climate fight.

COP process questioned

Despite years of previously lauded climate agreements, countries raised alarms about the fact that both greenhouse gas emissions and global temperatures are still rising.

Countries have been hit by increasingly extreme weather, making clear that the pace of progress hasn't been fast enough to prevent a climate crisis.

This year is on track to be the warmest ever on record, with evidence of climate impacts spiraling faster than expected.

Widespread flooding has killed thousands and left millions hungry across Africa; deadly landslides have buried villages in Asia. Drought in South America has shrunk rivers - vital transport corridors - and livelihoods. And rain-triggered floods in both Spain and the United States have killed hundreds of people while wiping out billions in economic value.

Costly trade policies

Developing countries pushed hard at COP29 to open discussions about climate-related trade barriers, arguing that their ability to invest in greening their economy was undermined by costly trade policies imposed by the world's wealthiest economies.

In focus was Europe's planned carbon border tax (CBAM). But equally worrying is the prospect of Trump introducing broad tariffs on all imports.

The UN climate body agreed to add the issue to future summit agendas.

Controversial fossil fuel interests

This year's COP was the third in a row to be held in a fossil fuel producing country, with both the OPEC secretary general and the president of host country Azerbaijan telling the summit that oil and gas resources were "a gift from God."

In the end, the summit failed to set steps for countries to build on last year's COP28 pledge to transition away from fossil fuels and triple renewable energy capacity this decade.

Many negotiators saw that as a failure - and a sign that fossil fuel interests were overpowering climate talks.

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