COP29 secures 60% finance boost for low-middle income countries
An early victory in Baku sees a huge pledge from major development banks, significantly increasing money flowing into poor nations struggling with climate change.
The World Bank and a number of other lenders announced on Tuesday 12th November that they would increase finance to low and middle income countries to $120billion by 2030. This represents a 60% increase in 2023 funding levels.
One of the pre-stated goals of COP29 is an uplift in funding for climate mitigation, adaptation, energy transitions and waste flow management. A recent analysis by BloombergNEF found that biodiversity finance alone will need to be eight times higher than it currently is in order to meet global needs by the end of this decade, while investment in many other vital areas has actually been slowing in the last two years.
‘It’s a very good sign,’ Irish Climate Minister Eamon Ryan told Reuters, speaking about the new finance agreement. ‘It’s very helpful. But on its own that won’t be enough.
Financing has long been a major obstacle for the global transition. In 2009, world leaders agreed to spend $100billion supporting developing countries in switching to clean energy and preparing for the challenges of climate change. However, this obligation was only met in full for the first time in 2022. The pledge runs until the end of this year.
Pressure is now on governments and private sector businesses to contribute more money, which would help boost this latest deal from banks. However, with a number of high ranking figures, including leaders from the 13 heaviest polluting countries, notably absent from talks, it’s unclear as to how the coming 12 days will unfold.
Finance was also a big subject in a speech delivered by the UN Secretary General António Guterres at the COP29 Leaders Summit of Small Island Developing States on Climate Change, held in Baku this morning.
‘You are on the sharp end of a colossal injustice. An injustice that sees the very future of your islands threatened by rising seas; your people pounded by record hurricanes. Your economies torn apart, and development gains left in tatters,’ he said.
‘The Pact for the Future – adopted by consensus in September – made significant strides forward. It calls for reform of the international financial architecture, including effective debt relief. It commits countries to advancing an SDG Stimulus of $500 billion a year,’ Guterres continued. ‘And it asks Multilateral Development Banks to look at ways to improve access to concessional finance for developing countries. And to consider structural vulnerability – including through using the Multidimensional Vulnerability Index. It is essential that vulnerable middle-income countries can access funds. We must push for implementation of these commitments.’
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Image: Kyle Glenn via Unsplash