COP29 And The Crisis Of Climate Finance Governance

COP29 in Baku (2024), the so-called "Finance COP," delivered its mandated outcome by agreeing on a New Collective Quantified Goal (NCQG) on climate finance – a headline figure of "striving to reach a floor of USD 1.0 trillion annually by 2030." While this was a historic acknowledgement of the scale of climate finance needs, the agreement fell short in substance. The decision allows concessional loans and mobilizes private flows to count as climate finance, offers only aspirational language on grants and a 50/50 balance between mitigation and adaptation, leaving Loss & Damage finance marginal and undercapitalized. With just $700 million pledged, the L&D Fund remains symbolically operational but functionally inadequate. These compromises reflect the entrenched North-South divide, with developed countries prioritizing quantity through leveraged finance and developing nations demanding quality, equity, and predictability.

- By GSM Shamsuzzoha (Nasim)

The implications are serious. Implementation challenges, especially in mobilizing reliable finance for adaptation and L&D in vulnerable contexts, risk turning the NCQG into another unmet promise. COP29 did not rebuild trust but instead highlighted fault lines around equity, responsibility, and geopolitics. This weakens the foundation for COP30 (Belem, 2025), where countries must submit enhanced NDCs. Without credible finance flows, developing countries are unlikely to scale ambition, while the 1.5°C pathway narrows further. To salvage credibility, COP30 must link finance to ambition with enforceable commitments on grants, adaptation balance, and L&D replenishment. Otherwise, COP29 will be remembered less as a breakthrough than as a missed opportunity that deepened mistrust and left climate-vulnerable communities dangerously exposed.

The Promise and Burden of a “Finance COP”

The 29th Conference of the Parties (COP29) to the United Nations Framework Convention on Climate Change (UNFCCC), held in Baku, Azerbaijan, in November 2024, was heralded as the “Finance COP.” Unlike many previous conferences, where the agenda sprawled across mitigation, adaptation, carbon markets, and technical negotiations, the mandate of COP29 was singular and explicit: establish the New Collective Quantified Goal (NCQG) on climate finance. This goal was to replace the symbolic but chronically unmet $100 billion annual commitment made in Copenhagen in 2009, and set the framework for climate finance flows after 2025 – a framework that would determine whether the world can realistically pursue the Paris Agreement’s objectives, especially the ambition of limiting warming to 1.5°C.