The cooks are all making their way back to the climate kitchen. The piping hot Global Stocktake (GST) decision served up at COP28 has cooled and been absorbed in all its essence – the sweet, the sour and the distinct unmissable hints of bitter.
As we approach the mid-way point in this critical decade, the kitchen has a new dish to cook: The New Collective Quantitative Goal on Climate Finance (NCQG). It’s due to be served up this year, and is essential to bring substance to the perpetually sticky subject of climate finance. The nutrition from this dish will also be a key determinant of how the GST outcomes are turned into action in the next iteration of Nationally Determined Contributions (NDCs), which countries are due to submit in 2025.
Finance is a necessary dimension that determines the scope and depth of climate action, so ECO would like to suggest the elements needed for a satisfying outcome this year.
The central dish in this year’s meal will be the NCQG. ECO would like to stress that a simplistic, linear approach would be insufficient to handle the heat of worsening climate impacts and the ever-increasing urgency for real, effective, and sustained action. The NCQG must cover Mitigation, Adaptation, and Loss & Damage in an equitable manner. And it must be made up of satisfying public finance grants, balanced across the pillars of climate action.
This centrepiece must be accompanied by a tasty array of side-dishes. It must be accompanied by the fibre of a just transition, and spice of a fair, fast, full, and funded fossil fuel phase out without the poison of dangerous distractions. The substance of adaptation must come through a well-defined roadmap for the two-year UAE-Belem Work Programme tasked with developing indicators for the Global Goal on Adaptation (GGA).
Fundamental for this meal to be relished by all is the just transition dish, addressing how workers and communities whose lives and livelihoods will be impacted by the transition to a climate sound society will be supported. Justice is an ingredient that tends to be forgotten, but is definitely worth the expense – This is why discussions on finance must include considerations for strengthening universal social protection systems, skills development & re-skilling, economic diversification, environmental restoration, as well as social and environmental security.
All these elements must be topped with a flavoursome sauce. This must be heavy on moral clarity, justice, and equity for the meal to be palatable and satisfying. Guiding principles of the UN Framework Convention on Climate Change (UNFCCC) and the Paris Agreement, such as equity, common but differentiated responsibilities, and respect for human rights must be generously and meticulously mixed throughout – consistency is key.
We have gone down the low-ambition road before, see the previous attempt at mobilising climate finance through the woefully insufficient target of USD 100 billion annually. Developed countries must take the lead in the provision of finance to developing countries, as they are obligated to under the UNFCCC and the Paris Agreement.
Satisfying hunger for climate action will require us to go well beyond the USD 100 bn floor and into the trillions of dollars per year.
The punch of quantitative ambition must be complemented with strong qualitative elements that ensure improved access, focus on people-centric, human rights-based, and gender-responsive delivery and minimise the cost of capital, especially in developing countries. Strong qualitative and quantitative aspects must be complemented with clear transparency and accountability measures, including a well articulated review mechanism. At this point, ECO must emphasise that carbon markets are not climate finance. Selling credits and allowing polluters to continue emitting by claiming offsets is not climate finance and cannot be an excuse for not having a robust NCQG.
A burden-sharing mechanism among developed countries to enable the fulfilment of unpaid arrears in a time bound manner, will add a dash of zest to the NCQG. Meanwhile, the recognition and introduction of equitable forms of progressive taxation based on the polluter pays principle will elevate it to a whole new level.
What separates a bad outcome from a good one (and a good one from a great one) is how well it reflects justice, reduces inequities and embodies the love for humanity. They say good food comes from the heart. As it happens, it would seem that climate negotiations are not so different.