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Tricky Finance Talks at the G20: A Cry for Help
At a press conference in Baku yesterday, COP29 President Mukhtar Babayev sent a clear message to the G20 leaders summit in Rio de Janeiro. He pleaded for help in unlocking the finance talks, stating, "The world is waiting to hear from them. We want them to provide clear mandates to deliver at COP29 – this is their chance to show leadership." While Baku rested, the G20 leaders in Rio put out a joint statement addressing various issues from hunger to artificial intelligence. However, the section on the COP29 finance goal was rather brief. It simply said, "We look forward to a successful New Collective Quantified Goal (NCQG) outcome in Baku. We pledge our support to the COP29 Presidency and commit to successful negotiations in Baku." UN climate chief Simon Stiell noted that the G20 leaders had "sent a clear message to their negotiators at COP29: do not leave Baku without a successful new finance goal." He added that this was in every country's clear interests.The fossil fuel transition talks at COP29 were rescued from the brink of collapse. Reuters reported that the communiqué had planned to mention developing nations' voluntary contributions to climate finance, which was one of the main sticking points in the finance talks. Rich nations wanted to expand the donor base. But this did not make it into the final text. Veteran climate campaigner Harjeet Singh accused the G20 leaders of a "stark failure." He said, "Their rehashed rhetoric offers no solace for the fraught COP29 negotiations, where we continue to see a deadlock on climate finance." He added, "Without decisive progress on finance at COP29, we are steering towards a catastrophic temperature scenario, where the most vulnerable will bear the gravest consequences."Still, some analysts gave a more positive view. Andreas Sieber of climate campaign group 350.org said the G20 declaration could not be called a "breakthrough" but had "got us a step closer to agreeing a finance deal here." He called the leaders' backing for the finance talks "significant." There was also hope that climate finance could get a boost from the G20 leaders' support for a tax on the super-rich. The communique noted that "we will seek to engage cooperatively to ensure that ultra-high-net-worth individuals are effectively taxed." Rebecca Thissen, global advocacy lead at Climate Action Network International, said this aim "provides a clear pathway to raise the trillions of dollars required for climate action and sustainable development."The G20 communiqué also recognizes the need for a strong replenishment of the International Development Association (IDA), a highly concessional World Bank fund to tackle poverty. Luca Bergamaschi from Italian think-tank ECCO said, "Given that it's a fund for development around the world and climate finance is development, we think that could be a good model." IDA's coffers are now being refilled, mostly by developed countries. The US made a record $4 billion promise on the sidelines of the G20 as one of Joe Biden's last actions as president. Some large developing countries also contribute funding, including China, South Korea, and Saudi Arabia.EU's Stance on the NCQG
The European Union has been reluctant to publicly disclose how much it thinks the post-2025 climate finance goal (NCQG) should be. More than one week into COP29, its officials still haven't proposed an amount. But Politico reports that it is internally discussing figures between $200 billion and $300 billion a year by 2035. This is similar to what observers at COP29 have told Climate Home. Bergamaschi from ECCO said he thought a feasible upper limit for what could be agreed was $400 billion if developing countries could be persuaded to expand the list of contributors. A recent UN-commissioned report by economists Vera Songwe, Nicholas Stern, and Amar Bhattacharya found the figure should be at least $300 billion. These numbers cover finance provided by governments, private finance mobilized by government investment, and a proportion of multilateral development banks' funding. This "core goal" will replace the existing goal of $100 billion a year from 2020 and is likely to be at least $1 trillion a year.Fossil Fuel Transition at the G20
On global efforts to cut emissions and boost clean energy, the G20 leaders said they "fully subscribe to the ambitious and balanced outcome" from COP28 in Dubai last year without explicitly mentioning the pledge to "transition away from fossil fuels" in energy systems. Ani Dasgupta, head of the World Resources Institute, said it was "unfortunate that the G20 failed to reiterate the commitment to shift away from fossil fuels," which was widely viewed as a historic outcome from the COP28 summit. The New York Times reported that Saudi Arabia was one of the main blockers for the fossil fuel language at the G20. The oil-rich kingdom has also blocked fossil fuel transition language at COP29, where observers said Saudi negotiators were "happy to be destructive."The G20 communiqué does mention the COP28 pledge to triple renewable energy and double energy efficiency. It also expresses support for "low-emission technologies," which was interpreted as meaning fossil gas in the COP28 outcome. The G20 declaration even gives room for the expansion of other fossil fuels as it expresses support for "abatement and removal technologies in line with national circumstances by 2030," which are ways to stop emissions from burning oil, gas, and coal from being released into the atmosphere. India, Indonesia, and China have large expansions of coal-fired power in the pipeline, while the US is behind a third of the world's planned expansion of oil and gas. Champa Patel, executive director for governments and policy at the Climate Group, said that to avoid backsliding, the G20 needed to be bolder. She said, "With an incoming President Trump, this task will get harder. It's outrageous that in 2024, which is already the hottest year on record, the biggest economies in the world can't state the truth: that we need to phase out fossil fuels now."