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Finance and policy updates continue to trickle in from COP29 as negotiations move forward slowly toward Friday’s finish line. The first iteration of a full draft text outlining new funding targets to support developing nations is reportedly being released tonight, Lead Negotiator Yalchin Rafiyev of Azerbaijan said in comments picked up by Japanese news outlet NHK World.
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COP FINANCE-
#1- US to announce USD 325 mn contribution to CIF: The US will contribute USD 325 mn to the Climate Investment Fund (CIF), The Guardian reported citing comments made by senior White House officials. This new funding — dedicated to low-carbon energy projects — brings the total US contributions to USD 1.8 bn.
#2- Australia will commit AUD 50 mn to the Loss and Damage Fund to help vulnerable nations fight the damage from climate change, The Guardian reports. The commitment was welcomed by climate groups as the fund has had lower commitments in COP29 than last year’s COP28.
ALSO- Australia will invest AUD 125 mn to improve energy security and transition to renewable energy in the Pacific region, according to a statement. The funding includes AUD 75 mn for the new REnew Pacific program, which will deliver off-grid and community-based renewable energy projects. It also includes AUD 50 mn for the Australia-Pacific Partnership for Energy Transition (APPET) program, supporting energy transition modeling, grid studies, university research, and workforce training.
ON THE POLICY SIDE-
#1- 30 countries pledge to cut methane emissions from organic waste: 30 countries have signed the Reducing Methane from Organic Waste Declaration at COP29, pledging to reduce the greenhouse gas emissions from organic waste and incorporate reduction efforts into their NDCs, according to a statement. The signatories account for 47% of these emissions and include 7 of the top 10 emitters globally. The declaration builds on the 2021 Global Methane Pledge, which aims to reduce methane emissions to at least 30% below 2020 levels by 2030. From our region, only UAE, Turkey, Morocco, Palestine, and Jordan have signed.
#2- UK + New Zealand + Colombia move to phase out fossil subsidies: The UK, New Zealand, and Colombia have joined the international Coalition on Phasing Out Fossil Fuel Incentives Including Subsidies (COFFIS), The Guardian reports. COFFIS brings together governments — a Netherland-led coalition including mostly 16 European countries — to support the phaseout of fossil fuel subsidies. Member countries plan to present national plans for phasing out “inefficient fossil fuel subsidies” at COP30.
#3- WGEO and UNDP forge partnership to accelerate climate action at COP29: UAE-based World Green Economy Organisation (WGEO) and the UNDP signed a partnership during COP29 to advance countries’ push towards the goals of the Paris Agreement, Wam reports. The collaboration will focus on key areas such as carbon markets, land and water management, adaptation, and mitigation. The partnership also seeks to attract private and public capital for green initiatives, starting with identifying nations with high potential for transformation.
AND A SLIVER OF OPTIMISM FROM ANALYSTS-
Economists say USD 1 tn climate finance goal is achievable. A mix of new taxes, private capital, and funds from development banks and wealthier nations is well-poised to raise the USD 1 tn annually needed by 2030 to combat the climate crisis is achievable without straining global economies, The Guardian writes. Economists Amar Bhattacharya of the Brookings Institution and Nicholas Stern of the UN’s independent high-level expert group (IHLEG) highlighted that the investment is crucial to prevent economic damage and inflation caused by climate-related disruptions. The IHLEG suggests that half of the required funds come from private investments in green infrastructure, while multilateral development banks and direct aid from rich countries should cover the rest.
Why blended finance is wise business: Private sector financing is criticized for deprioritizing adaptation projects and for the potential of deepening debt burdens for poorer nations. Economists argue that the mix of funding sources would allow better allocation of money, leaving public funds to focus on adaptation projects and private capital to invest in the more attractive mitigation and transition projects. This approach would enhance the stability of vulnerable countries and ensure a fair distribution of climate finance, they argued.
A prime example: Small-scale farmers, who produce over a third of the world’s food and up to 80% in regions like Asia and Africa, receive only 14% of the USD 9.1 bn global climate funding earmarked for agriculture, Bloomberg reported citing figures by Climate Focus. The disparity is even starker when considering that less than 3% of total public climate finance is allocated to food systems, despite these systems contributing about a third of global emissions.
