Bonn: UN Pressures Countries for Agreements on Climate Financing

 Bonn: UN Pressures Countries for Agreements on Climate Financing

The Executive Secretary of the UNFCCC, Simon Stiell, called on governments for “serious progress” in the Bonn talks to facilitate an agreement on climate financing at COP29.

From Climainfo

“Make every hour here count.” This was the plea from Simon Stiell, Executive Secretary of the UN Framework Convention on Climate Change (UNFCCC), to negotiators from more than 190 countries at the opening of the 60th meeting of the Convention’s subsidiary bodies last Monday (3/5) in Bonn, Germany. The main challenge of the meeting is to start outlining the future of climate financing from 2025 onwards.

“We must make great progress in finance, the main enabler of climate action. I urge everyone to move from ground zero to real options that lead us to a new collective quantified goal in terms of financing,” emphasized Stiell. “We cannot afford to arrive in Baku [host of COP29 in November] with a lot of work still to be done.”

Climate finance negotiations are fraught with deadlocks. Countries (generally divided between developed and developing) remain divided over the new global financing target that will replace the $100 billion annually.

There are no formal numbers on the table yet, but developed governments are showing reluctance regarding the figures mentioned by experts and negotiators from developing countries, all in the trillions of dollars annually. For example, Valor highlighted President Lula’s assessment that developing countries will need something between $4 trillion and $6 trillion annually to finance climate action.

Another impasse is the sources of this financing. Developing countries advocate for the expansion of public funds from developed countries as a way to increase climate financing. Wealthy governments argue for a diversified sources approach, including emerging nations (read China), multilateral financial institutions, and private capital.

The mode of climate financing also divides countries. The poorest nations argue that these resources should be provided as grants, not generating external debt that could further complicate their macroeconomic situation. Another demand is that wealthy governments swap external debt payments for resources that can be used for mitigation and adaptation in the poorest and most vulnerable countries.

The Guardian highlighted a survey by Debt Justice which found that debt payments by the 50 countries most vulnerable to the climate crisis have doubled since the beginning of the COVID-19 pandemic and are at their highest level in three decades. These countries are paying, on average, 15.5% of their government revenues to external creditors.

“Record levels of debt payments are draining the capacity of the most vulnerable countries to address the climate emergency. We need a fast and effective debt relief scheme to cancel debts to a sustainable level,” argued Heidi Chow, Executive Director of Debt Justice. 

Climate Home covered the highlights of the start of SB60 in Bonn.

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