Why climate finance is no longer enough

With the UN Climate Conference (COP30) in Belém, Brazil, kicking off, it is clear that the world’s widely shared commitment to a just energy transition is falling by the wayside.

- Laura Carvalho

In the year since governments signed on to the agreement at COP29 to scale up climate finance — with a goal of mobilising $1.3 trillion (42 trillion baht) annually by 2035 — wealthy countries have been retreating from their pledges. Worse, these signs of bad faith are coming just as the costs of climate adaptation and decarbonisation in developing countries are mounting.

This is not an issue that can be deferred. The shift to a green economy is already reproducing the same asymmetries that have long defined global trade. Instead of fostering inclusive development, climate policy is increasingly being shaped by protectionist measures and IP regimes that entrench technological monopolies in the Global North. For example, the European Union’s Carbon Border Adjustment Mechanism (CBAM) may be billed as a safeguard against carbon leakage, but it also illustrates how climate policy can be used to justify protectionist trade measures. Meanwhile, China's recent complaint against India for its electric-vehicle and battery subsidies shows how green industrial policies are increasingly becoming grounds for trade disputes. Together, these developments signal a growing tension between climate goals and World Trade Organization rules.