Dubbed ‘the Finance COP,’ the latest global climate summit would succeed or fail based on the nature of the deal made on the New Collective Quantified Goal (NCQG) on climate finance. After two weeks of strained negotiations – the climax of over three years’ worth of work to replace the existing $100bn annual target – an agreement was eventually reached in Baku. The clear conclusion from developing countries and civil society is that this agreement cannot address the real needs of those facing climate disaster, now and in the future.
Alliance partners have long been pushing for a robust NCQG, because finance underpins all climate action; reducing carbon emissions globally, helping developing countries adapt to the new conditions, and addressing the catastrophic loss and damage caused by climate-induced disasters.
As COP29 approached, we called for developed countries to provide or mobilize more than $1 trillion annually to meet the challenge of climate change – primarily grant-based, with considerations made for easy access, gender equality, and above all a ‘fair share’ approach that acknowledged historical responsibility for the crisis. The resulting deal comes up short on all fronts.
This finance COP has been a colossal disappointment which failed to address the demands of the most vulnerable countries. This lack of progress, at a time when we needed it most, means vulnerable nations are still left without the support they desperately need. This failure to deliver is a betrayal of climate justice and global solidarity.
Salomé Lehtman, Project & Advocacy Advisor, Mercy Corps
Not enough finance, not enough accountability
The final figure of $300 billion a year – which will not be delivered until 2035 – does not even meet the needs for necessary climate adaptation efforts – estimated at $215–387 billion annually by 2030. Not only is this figure far short of what is needed, the agreement also fails to learn the lessons from the oft-missed $100 billion goal by not establishing who must pay, and how much.
Developed countries have a legal obligation to provide finance as outlined in the Paris Agreement, as well as a moral obligation to recognize their historical responsibility for climate change, and ability to pay. The absence of a burden-sharing mechanism in the NCQG means that countries will not be held to specific financial targets, making it likely that even the $300 billion won’t be met.
The NCQG includes a ‘Baku to Belém Roadmap to $1.3 trillion,’ recognizing the figure that developing countries were calling for during COP29. It remains to be seen whether this becomes a useful process to strengthen the quantity and quality of climate finance.
Lack of clear commitments sets NCQG up to fail
Much of what has been agreed in the NCQG sounds positive, but the agreement is riddled with lack of detail in the delivery:
- While the decision acknowledges the importance of providing climate finance as grants rather than loans, it sets no obligations. Developing countries should not have to bear a debt burden to address a crisis they did not cause, and so the NCQG’s failure to protect against this is a glaring omission.
- The absence of any solid division between ‘provision’ and ‘mobilization’ of finance provides leeway for developed countries to shift their financial obligations into the private sector. While private investment has a role to play in climate finance, it is deeply unfit for purpose in most cases – including for adaptation, loss and damage and least developed countries.
- The NCQG sets a direction for enhancing access to climate finance – a longtime obstacle developing countries face when preparing for, or recovering from, climate shocks – but lacks strong language to see any rapid and concrete action.
- Finally, a key to bridging the financing gap lies in innovative sources of climate finance, such as a wealth tax, an aviation levy and a maritime levy. However, the NCQG text lacks any serious commitment to such mechanisms, making it very hard to see the path to $1 trillion.
The lack of ambition and ambiguity of the NCQG text again fails those from the most climate-vulnerable countries. When developed countries who have signed on to the Paris Agreement – and are accountable – have so far failed to meet the financial targets to date, it is abhorrent to think that developing countries can rely on good faith to meet their needs.
Laura Bahlman, Advocacy and Knowledge Adviser, Concern Worldwide
No momentum on Loss and Damage
Rich countries blocked the inclusion of Loss and Damage (L&D) in the NCQG. This had been a clear ask from developing countries from the start, and while it remained in the early draft texts, the final decision effectively excludes L&D. While acknowledging urgent L&D needs, the NCQG offers no guaranteed, dedicated funding – and without this, the Fund for Responding to L&D risks becoming an empty bucket, making a mockery of the gains made at COP28. Indeed, new pledges into the Fund at COP29 amounted to less than $100m. Climate vulnerable communities cannot endure further delays; delivering meaningful funds for L&D is a moral and practical necessity.
There was also no agreement on other important aspects of L&D – the third review of the Warsaw International Mechanism (WIM) and the routine WIM report. Both were delayed due to ongoing disagreements around, the location of the headquarters of the Santiago Network for L&D, and the request by developing countries for a WIM-mandated UN L&D gap report. Given the lack of consensus, these discussions have been postponed to the next technical session in June 2025.
The promise of $300 billion per year and the nebulous $1.3 trillion investment shift is inadequate, both in quantity and quality and the lack of clarity risks locking developing counties into increasing debt and suffering. Sadly the global north gavelled through an agreement that forced developing countries to accept a deal that is woefully inadequate to address the gravity of our shared climate emergency.
Colin McQuistan, Head of Climate and Resilience, Practical Action
Progress on adaptation a silver lining
Although countries failed to advance guidance on National Adaptation Plans with the sticky issue around conditional funding for adaptation action, real progress was made on the Global Goal on Adaptation (GGA), after years of slow progress.
This could be considered a rare success of these negotiations; the GGA provides a framework to evaluate progress on adaptation, including a range of global and local indicators from which countries can choose to best suit their national circumstances. The refining of indicators is also guided by essential locally-led and inclusive human rights-based principles.
What next for climate finance?
The NCQG is a far cry from the needs of vulnerable communities and a complete disconnect from the climate emergency the world is facing. A day after the COP – which was one of the most fractious in years – we will need to regroup and consider how we can best continue our work to increase the quantity and quality of climate finance for the vulnerable communities that we work alongside.
This may be through engagement with the ‘Baku to Belém Roadmap’, which will report to the next COP in Brazil. It may also be through supporting the work of the Coalition for Solidarity Levies which is increasing momentum for the new innovative sources of funding that are so desperately needed to provide more grants.
Away from the UNFCCC process, the Alliance will continue to support climate-vulnerable communities, and build evidence for how properly-funded, locally-led adaptation can make a real, lasting impact on lives and livelihoods across the world.
The outcome of the NCQG is devastating. Climate finance is not a luxury. It is a lifeline for communities facing the impact of the climate crisis. Girls face the worst of the climate crisis, and we cannot risk leaving them behind. We need climate finance to ensure intergenerational and gender justice. Unfortunately, this COP squandered hopes of achieving this.
Kupakwashe, 23-year-old Plan International youth COP29 delegate from Australia
Recap the Alliance’s activities at COP29 here.