Developed countries therefore committed in Baku to further finance vulnerable countries threatened by climate change to the tune of at least 300 billion dollars per year by 2035. The previous objective set in 2009 was to reach 100 billion per year in 2020. But the new amount is far from the expectations and needs of developing countries and some, NGOs or negotiators, believe that it is not an effective tripling.
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The first element put forward in particular by NGOs is inflation, which is gradually reducing the extent of what can be done with the promised aid. It’s difficult to project ahead to 2035, but already, to do what we did with 100 billion dollars in 2009, we would need a little less than 150 billion today.
Then, the calculation of aid is direct and, according to the expert, difficult to calculate as the financing levers are varied. Alpha Kaloga, Guinean negotiator, estimates that the direct effort of developed countries will be less than 300 billion dollars. According to his calculation, multilateral development banks will be able to provide $120 billion in 2030 in the form of loans, he assures.
A new accounting of aid
However, the agreement incorporates something new in the accounting of aid. Harjeet Singh of the Climate Action Network illustrates this with the example of China. “ If China provides money through institutions like the World Bank, that money will be counted. If China accepts it “, he warns.
Beyond knowing who pays, one of the main questions is in what form. “ There is no clear demarcation between the share of funds mobilized in the form of a grant and the share which will be mobilized in the form of a loan “, notes Harjeet Singh.
A difference which is all the more important when the beneficiary countries are already in debt.
Also readCOP29: at least $300 billion in annual climate finance for developing countries
Why poor and vulnerable countries agreed to the deal
After two nights of overtime at the COP29poor and vulnerable countries have resigned themselves to this commitment which increases the current commitment of rich countries of 100 billion dollars per year. However, just hours before, the least developed countries and small island states had left a consultation with this same amount. For a few days, voices were even raised, including within the group Africato say that it was better to have no agreement at all than to have a bad agreement.
Alden Meyer, senior associate at climate change think tank E3G and COP veteran, identifies several reasons for this accepted compromise. “ Developing countries really need more financial aid. This is not what they wanted. Obviously, this is far from enough. But I think that at the end of these two weeks, they understood that their partners in developing countries were not going to raise the target much beyond $300 billion. », he analyzes.
I think the presidency [de la COP29] is a factor that played a role here. The negotiators I spoke with did not want to spend more time next year working under this presidency to try to get a deal. They wanted to finish it and move on to Belém and no longer have to work under this presidency. And then there will be a new president in the United States in two months, and even though he said he would withdraw from the Paris Agreement, there is uncertainty about the behavior of the negotiators in this process.
Alden Meyer, Senior Associate at E3G
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