Can anything good come out of COP29?

“The US at this COP is not just a lame duck, it’s a dead duck. They can’t commit to anything and that means that countries like China will not want to commit to anything.” –  Prof Richard Klein, Stockholm Environment Institute.

There is every reason to be anxious about the outcome of the ongoing 29th Conference of Parties to the United Nations Framework Convention on Climate Change, popularly known as COP29, in Baku, Azerbaijan. This year’s meeting has finance as the central focus of its agenda, and the rich countries of this world should be the driving force behind the green finance thrust. But, the sobering reality is that hoping for ambitious climate action decisions at the end of the COP might be nothing short of a pipe dream. America, the planet’s richest nation, has an incoming commander-in-chief, whose body language portrays a leader that would be stingy to the climate by the time he is sworn in as the President of the United States of America in two months’ time.

On this column, I have always argued that monetary incentives are rapid drivers of change and should be given greater considerations as a strategy for robust environmental governance. The fight against climate change gathered more momentum when renewable energy innovations and deployments emerged as business models, traversing all geographies. This is why robust economies like the USA and the Europe Union took the lead, and eventually drove down their carbon footprints as a result of the natural emission caps that renewables bring to bear on the ecosystem. Alas, all these gains may go down the tube when a new American government halts green incentives to such sustainable businesses.

The signs are already emerging, just a week after Donald Trump’s victory. There was a big drop in the share price of turbine manufacturers last week Wednesday as fears grew that US offshore wind farms would be cancelled by a Trump presidency. Granted, some analysts argue that in the longer term, the new president may not turn back the clock for coal, oil and gas, or curtail the growth of sustainable energy sources. But my concern is that the world does not have the luxury of time. Few weeks ago, the United Nation’s Environment Program’s annual Emissions Gap report warned that the world faces as much as 3.1 degree Celsius of warning above pre-industrial levels by 2100 if governments do not take greater action on slashing planet-warming emissions. Negotiations in Baku will help to inform each country’s updated emissions-cutting strategy, known as a Nationally Determined Contribution, which are due in February 2025.

This is why COP29 is important. It specifically focused on the New Collective Quantified Goal for climate finance, required under the 2015 Paris Climate Pact. Under the agreement, rich countries are obligated to provide climate finance to help developing nations cut their greenhouse gas emissions and adapt to the impacts of climate change. At that time, it was agreed that the rich nations shall private $100billion annually for this purpose; but now there is a consensus among stakeholders that the proposed green climate fund is inadequate. They now demand upwards of USD500 billion in carbon financing.

There are other items on the COP29 agenda. Loss and Damage Fund is on the table. For years, developing countries were asking for loss and damage funding to help them rescue and rebahibilate regions and communities afflicted by climate change-induced extreme events. Last year, in Dubai, it was green lighted. So, this year, COP29 will work towards operationalizing the Fund. The other item is Nationally Determined Contributions. Governments are supposed to submit their updated plans next February, well ahead of the COP30 scheduled for Brazil, next November, where they will be assessed.

Another important item is known as Article 6. Because carbon trading has been a vexed issue at all the COPs, article 6 of the Paris Agreement – left over when the rest of the Paris rulebook was finalized – has never been resolved. It was discussed at COP26, then pushed to COP27 unresolved, and to COP28. It is hoped that it will be finally sorted out this year.

Nevertheless, while we keep our fingers crossed for fruitful negotiations, we are yet faced with another challenge, which I hope we could easily recover from. The problem is psychological, which came in the form of cold water poured on the engine of COP29 as it was about to be kick-started earlier this week. On his opening remarks, Azerbaijan’s President Ilham Aliyev declared that oil and gas are a gift from God, signaling a government sanctioned stance to remain on the path of fossil fuel production and consumption. This is ironical and highly unfortunate considering that COP 29 is expected to build on the gains of COP28 (Dubai) where the world resolved to ‘transition away’ from fossil fuel. To add salt to injury, a senior official in Azerbaijan’s COP29 team, Elnur Soltanov, was captured on camera discussing ‘investment opportunities’ in the country’s state oil and gas company with a potential investor. The country plans to expand gas production by up to a third over the next ten years.

This will only dampen hopes of breakthroughs at the COP. At a time when nations are looking to boosting climate ambitions, hope is a currency of ultimate importance. When developed countries surpassed the USD100 billion climate finance for developing countries, by mobilizing USD115.9bIllion in 2022, many stakeholders became overjoyed at the prospects of a successful climate finance transition beyond 2025. But now that the apple cart has been toppled, the world can only hope that world leaders find their way back to the train of reason. Good enough, UN Secretary General, immediately after the ‘gift from God’ speech, told the conference that doubling down on the use of fossil fuels was ‘absurd’.

In my view, the weakest link at COP29 could also become its biggest strength. In clear terms, as the conference will be setting a new finance goal that will help ensure that developing countries who are more vulnerable to climate impacts can receive adequate financing to address the challenges they are facing, everybody would become a winner when compromises are made to ensure that the meeting never closes without a deal.

Since we all know what Trump stands for, America should not be a factor in negotiating the new way forward for the Paris climate deal. Regarding the green carbon fund, rich countries are demanding that the contributor base be expanded. This is because, currently, only countries defined as developed under the 1992 UNFCCC contribute to the official climate finance. China, UAE, and Qatar, are not on this list, for example. But many countries’ economies and greenhouse gas emissions have expanded in the last three decades. For one, China is now the world’s second biggest economy behind the USA, and the biggest emitter.

These (new) rich nations must determine to make considerable impact as we arrive at this critical juncture in the fight against climate change. Some experts suggest there could be a compromise by which some developing countries contribute on a voluntary basis or are allowed to be both contributors and recipients of climate aid. In my mind, China could actually leverage this moment to position itself as a green giant whom the poor nations could look up to for climate action. Nature abhors a vacuum; if Trump’s America is not coming forth, Xi’s China will suffice.