International Growth Centre’s Post

🌍 As 50,000+ government officials, policymakers, investors, and non-state actors head to Baku for #COP29, all eyes are on a potential new climate finance goal that could define this event as the "#FinanceCOP." The New Collective Quantified Goal (#NCQG) on climate finance aims to accelerate climate action in developing countries, replacing the previous USD100 billion annual target, which was delayed in delivery by developed nations. Adding momentum, the COP29 Presidency has introduced the Climate Finance Action Fund (#CFAF), seeking voluntary contributions from #fossilfuel producers to support #climate projects in developing nations. Acknowledging the private sector's role within the NCQG could signal investors towards #climateambition post-2025 and strengthen commitments to bridging finance gaps. With studies indicating a need for USD2.4 trillion annually in #climatefinance for developing countries by 2030, and USD1 trillion in #cleanenergy investments alone, COP29’s policy outcomes could be pivotal for climate finance in this decisive decade. #COP29 #ClimateFinance #SustainableInvestment

Climate finance realities are threatening both development and climate goals. CATF's Kasparas Spokas and Lily Odarno, along with senior advisor, Kurt Waltzer, explore why a #COP29 finance pledge must produce credible plans to overcome barriers and produce significant investment in emerging and developing economies.   Much greater focus needs to be placed on evaluating the scalability of proposed solutions and then working on additional strategies to achieve both development and decarbonization targets. Given the likely limits of international concessional financing, we must place more attention on bottom-up actions that improve local investment conditions and foster wealth in domestic markets.   Doing so can enable climate action as part of development, not in spite of it.   Read more: https://lnkd.in/ePsGPE-v

#COP29 will largely focus on a finance pledge. But the global climate community must go beyond pledges and produce credible plans to overcome barriers and produce significant investment in emerging and developing economies. To create credible plans, much greater focus needs to be placed on evaluating the scalability of proposed financing solutions and then working on additional strategies to fill the gaps needed to achieve both development and decarbonization targets. We posit that no matter what finance pledge is agreed on at COP29, world leaders and financiers will need to answer the following questions quickly:  1. Are current proposed solutions sufficient to achieve such conditions, and if not, what other options exist?   2. What development-compatible decarbonization pathways are most plausible for EMDEs?  3. How can investment be optimized to unlock growth along with decarbonization? 

🌍 At COP29 in Baku, a groundbreaking report from the Independent High-Level Expert Group on Climate Finance highlights an urgent call: to meet the Paris Agreement’s goals, the world must mobilise USD 1 trillion annually by 2030 to support climate action in emerging markets and developing countries (excluding China). This target will rise to USD 1.3 trillion by 2035. 🌍 The report said delayed action will amplify future financial burdens and compromise global climate goals. To bridge this critical gap, it lays out four key pillars for financing transformation: 1️⃣ Triple Annual Climate Finance Pledges: Advanced economies should triple the 2009 climate finance pledge to USD 300 billion by 2030. 2️⃣ Expand MDB Capacity: Multilateral Development Banks, such as the World Bank, must triple lending capacity by 2030. 3️⃣ Private Sector Investment: The private sector is expected to provide about half of the necessary external financing, especially for renewable energy. 4️⃣ Strengthened South-South Cooperation: Enhanced financial contributions from key developing countries and South-South collaboration will be crucial for resilient and sustainable development. With climate costs projected to reach USD 6.3–6.7 trillion annually by 2030, this report underscores the importance of timely action. Key investment areas like Clean Energy, Adaptation, and Sustainable Agriculture require urgent attention to avoid severe climate and financial impacts. As global climate champions, we must embrace these recommendations, advocate for innovative financing mechanisms, and ensure a sustainable future for all. https://lnkd.in/gmh2a2wt 🌱 #COP29 #ClimateFinance #ParisAgreement #SustainableDevelopment #ClimateAction

London’s role as a global hub for sustainable finance shines as #COP29 highlights transition finance needs. As nations set ambitious climate finance goals, all eyes are on private sector funding to close the gap toward #NetZero.

🌍🌱 COP29 is just around the corner, taking place in Baku from November 11-22. Expect the New Collective Quantified Goal (NCQG) on climate finance to lead discussions, alongside a focus on updated national climate commitments. Stephanie Pfeifer OBE, IIGCC CEO, recently published an open letter calling on the NCQG to: "include clear recognition of the private sector's role." Updated and improved Nationally Determined Contributions (NDCs) will also be high on the agenda at 'The Finance COP'. Improved and more investable NDCs can be a powerful tool to attract private investment in emerging markets and developing countries. Our latest insight explores these key issues and what they might mean for investors, outlining our recommendations for the NCQG. https://lnkd.in/e5F5wytx #SustainableFinance #COP29 #FinanceCOP #NDCs #NCQG

[𝐏𝐀𝐑𝐓 1] COP29 Highlights: Finance, Climate Justice, and Urgent Calls for Action – A Digest of the Last Three Days "𝐀𝐫𝐠𝐞𝐧𝐭𝐢𝐧𝐚 𝐰𝐢𝐭𝐡𝐝𝐫𝐚𝐰𝐬 𝐧𝐞𝐠𝐨𝐭𝐢𝐚𝐭𝐨𝐫𝐬 𝐟𝐫𝐨𝐦 𝐂𝐨𝐩29 𝐬𝐮𝐦𝐦𝐢𝐭" The discussions this year carry a new level of urgency, underlining both challenges and commitments. Here's a comprehensive look at key developments from the past few days: 1. 𝐄𝐧𝐡𝐚𝐧𝐜𝐞𝐝 𝐂𝐥𝐢𝐦𝐚𝐭𝐞 𝐅𝐢𝐧𝐚𝐧𝐜𝐞 𝐂𝐨𝐦𝐦𝐢𝐭𝐦𝐞𝐧𝐭𝐬 Mobilizing substantial financial resources for climate action is a central focus. Multilateral development banks, including the World Bank and the European Investment Bank, have pledged to raise their climate-related lending to $120 billion annually. The Asian Development Bank is also committing an additional $7.2 billion for climate projects with support from the U.S. and Japan. These efforts aim to fill the significant funding gaps needed for climate mitigation and adaptation. Developing nations, led by China and the Group of 77, advocate for a revised climate finance goal (NCQG) that exceeds $1.3 trillion annually to meet their needs, emphasizing the importance of grants over loans and suggesting tax reforms and redirection of fossil fuel subsidies as potential sources. 2. 𝐃𝐞𝐛𝐚𝐭𝐞𝐬 𝐨𝐧 𝐅𝐨𝐬𝐬𝐢𝐥 𝐅𝐮𝐞𝐥 𝐃𝐞𝐩𝐞𝐧𝐝𝐞𝐧𝐜𝐲 The role of fossil fuels remains a contentious topic. Azerbaijan's President Ilham Aliyev defended the nation’s reliance on oil and gas, describing them as essential resources and resisting criticism. This highlights the tension between energy-dependent economies and the global push towards renewable energy transitions. 3. 𝐍𝐞𝐠𝐨𝐭𝐢𝐚𝐭𝐢𝐨𝐧𝐬 𝐨𝐧 𝐭𝐡𝐞 𝐍𝐞𝐰 𝐂𝐥𝐢𝐦𝐚𝐭𝐞 𝐅𝐢𝐧𝐚𝐧𝐜𝐞 𝐆𝐨𝐚𝐥 (𝐍𝐂𝐐𝐆) Establishing a new NCQG is crucial as the previous $100 billion annual pledge expires. Developing nations push for more significant commitments, emphasizing equitable distribution and sustainable financial support to bridge the existing shortfalls. 4. 𝐏𝐫𝐨𝐠𝐫𝐞𝐬𝐬 𝐢𝐧 𝐂𝐚𝐫𝐛𝐨𝐧 𝐌𝐚𝐫𝐤𝐞𝐭 𝐌𝐞𝐜𝐡𝐚𝐧𝐢𝐬𝐦𝐬 (𝐀𝐫𝐭𝐢𝐜𝐥𝐞 6.4) An agreement on Article 6.4, which oversees the trading of U.N.-backed carbon credits, has been reached. While this could unlock new climate finance avenues and bolster cost-effective emission reductions, concerns about the quality and regulatory standards of these credits persist. Calls for enhanced oversight to maintain market integrity are strong, highlighting the need for vigilance. 5. 𝐋𝐨𝐬𝐬 𝐚𝐧𝐝 𝐃𝐚𝐦𝐚𝐠𝐞 𝐑𝐞𝐚𝐥𝐢𝐭𝐢𝐞𝐬 The Fund for Responding to Loss and Damage, operational since last year, remains underfunded at $702 million, far from the hundreds of billions required annually. Advocates stress the necessity of a dedicated grants-based subgoal within the NCQG to provide reliable funding for the most affected communities. #COP29 #ClimateFinance #ClimateJustice #JustTransition #LossAndDamage #ClimateAction #GlobalCooperation Universal Versatile Society UNDP United Nations Chirag Kathrani

💡 Finance took centre stage at Bonn climate meetings, with negotiations on the new global climate finance goal featuring heavily. The New Collective Quantified Goal (NCQG) will likely be a defining issue at COP29 in Baku. While primarily a public finance commitment, a bolder, more ambitious approach to the NCQG can send strong signals to the international finance system. Our message going forward is that to be most effective, the delivery of finance must be considered on a case-by-case basis, with access remaining a key issue for investors. ⚖ The next set of Nationally Defined Contributions (NDCs) was also a recurring theme. Active engagement from the private sector will be key in pushing progress and ambition for national climate goals and climate finance commitments alike. Familiar arguments in global negotiations meant slow progress on finance discussions with no concrete agreements. Nonetheless, there was a willingness to find common ground ahead of the next round of talks, on areas including transparency. 📄 Read the full article from Arianna Griffa, Senior Policy Manager – Global: https://lnkd.in/g44-w9gG #NDCs #NCQG #COP29 #Bonn #ClimateChange

What size, what counts and who pays – discussing climate finance in Copenhagen Last week, I was in Denmark to attend the Copenhagen Climate Ministerial. The idea was to kick start the process for the next COP that will take place in November 2024 in Baku, Azerbaijan, as soon as possible. We gathered to discuss the outcome from COP28 last November in Dubai and the early expectations for COP29. Dan Jørgensen, Danish Minister for Development Cooperation and Global Climate policy, organised this Ministerial for the third year in a row. We were there with 40 ministers and climate negotiators, such as the Presidents of COP28 and 29. It was also the first time we met after COP28. We took a moment to reflect on what went well in Dubai. We need to continue with teamwork, coalition building and compromise. For COP29 in Baku, the official agenda will focus a lot on funding, as we have to decide amongst others on the new global climate finance target for the period after 2025. At COP29, we will all need to address three basic questions: 1.   What is the size of the goal? 2.   What financial flows count actually towards that goal? 3.   Who will in the end contribute to that goal? For the first question, we need to know the scope of the transaction. We need to discuss and agree on the New Collective Quantified Goal (NCQG) after 2025. We then need to look at financing and make sure that we keep the NCQG in the context of the overall challenge of ensuring that the financial flows are aligned with the Paris rules and the 1.5 degrees. Public money is part of the solution, but we also need to look at private sector money and finding innovative ways to unleash it. Finally, on who pays. The EU has been a very consistent donor, contributing our fair share. And we will continue to do so. But the overall needs are much bigger than that. We also need to see how we deal with the fact that many of those countries who were developing in the early 90s now have achieved much higher levels of development. Every country which has the ability to pay should contribute. We started discussing these three questions in Copenhagen. I would invite everyone to try to make this as concrete as possible, towards the next COP. In the end, the whole endeavour is not about shifting responsibility, but jointly taking responsibility. And if we do that, I am sure we can mobilise all the financing that is needed and the climate and future generations need. This way we make sure our climate goals are taken up in a way that we really can ensure just transition and competitiveness for businesses and citizens around the world. 

Baku 21 November 2024 The COP29 Presidency has released a draft narrative on 21st November,2024 outlining 2 distinct options for a post-2025 climate finance goal for developing countries. ActionAid Bangladesh views the recent draft text released at COP29 with serious concern. The lack of specific numerical targets for climate finance raises doubts about the commitment of developed countries to the New Collective Quantified Goal (NCQG). Additionally, the proposed options for a post-2025 climate finance goal present several challenges, including: • The proposed options lack a concrete financial commitment for Bangladesh, and other developing nations. • Source of Finance: We advocate for a focus on direct public finance from developed countries. • The allocation of funds needs to prioritize the specific needs of vulnerable countries, while including adaptation measures, mitigation efforts, and address loss and damage caused by climate disasters. • The inclusion of carbon markets in the text is deeply concerning. These mechanisms haven't proven effective and could create loopholes for polluters. AAB expresses deep concern over the ongoing divisions among nations regarding a fair and ambitious climate finance goal. It stresses the urgent need for compromise and collective action to address the climate crisis. A failure to reach a strong agreement at COP29 could have severe consequences for the planet and future. We urge all parties to demonstrate serious commitment. COP29 Presidency has released a draft narrative with 2 options. While both options agree on the recipient countries, there's ongoing debate on the specific allocation for Least Developed Countries (LDCs) and Small Island Developing States (SIDS). Wealthy nations are blocking climate progress by refusing to commit sufficient funds to help poorer countries. Countries like the Netherlands and the EU are stalling negotiations. Their proposed solutions, such as adding new funding streams, are inadequate. The EU climate commissioner has already rejected the current draft text. Teresa Anderson, the Global Lead on Climate Justice at ActionAid International, said: "Rich countries are failing this moral test. Developing countries have come to Baku with the hope that this COP would finally deliver the funding they need to cope with climate impacts and cut emissions. But the developed countries most responsible for causing climate destruction are turning a deaf ear to the reality faced by frontline nations. This draft doesn’t provide the trillions in grants that are needed to keep the planet safe. Instead of actually increasing their climate finance contributions, rich countries just want to increase what counts as climate finance. With all the loans and corporate investment being pushed into this new goal, this text could end up being a pretext for corporate profit under a climate veneer. The whole world needs COP29 to deliver trillions in grants every year for urgent climate action."