Developed Nations Propose USD 300 Billion Annually to Support Global South Climate Initiatives by 2035

Developed nations have proposed an annual fund of USD 300 billion by 2035 to assist developing countries in addressing climate change. This proposal came after two groups representing the most climate-vulnerable countries exited negotiations at COP29. The offer is significantly lower than the USD 1.3 trillion that developing nations have been requesting over the past three years.

The draft agreement, which includes this financial offer, aims to establish a new climate finance package for developing countries, known as the New Collective Quantified Goal (NCQG). This proposal will soon be presented for approval during a plenary session. The new figure is intended to replace the USD 100 billion commitment made in 2009.

Focus on Climate Finance Goals

The draft also introduces the Baku to Belem Roadmap. This roadmap is crucial for Africa and other developing regions, outlining a process to align global finance with achieving the USD 1.3 trillion target by 2035. The document emerged after prolonged negotiations that extended beyond their scheduled time.

The proposal outlines that USD 300 billion annually will be sourced from various channels, including public and private sectors, bilateral and multilateral agreements, and alternative sources. It explicitly references Article 9 of the Paris Agreement, which states that developed countries should lead in providing financial support.

Earlier drafts mentioned Article 9.3, which does not legally bind developed countries to this responsibility. The document includes the USD 1.3 trillion figure but calls for collaboration among all actors, both public and private, to achieve this target by 2035 without placing sole responsibility on developed nations.

Challenges in Reaching Consensus

Developing countries are encouraged to contribute more, including through South-South cooperation, but no specific amounts are mentioned for least developed countries or small island states regarding loss and damage compensation. The negotiations faced disruption when representatives from the Least Developed Countries (LDC) group and the Alliance of Small Island States (AOSIS) walked out of a meeting.

The LDCs expressed dissatisfaction over not being consulted on the draft, which lacked a minimum financial allocation for them. "Small Island Developing States and LDCs are among the very worst impacted by this climate crisis that we did not cause. Yet we have found ourselves continuously insulted by the lack of inclusion; our calls are being ignored," stated AOSIS.

Developing Nations' Financial Demands

The UN climate conference in Baku required countries to agree on a new climate finance package for developing nations. These nations have consistently demanded at least USD 1.3 trillion annually—13 times more than the USD 100 billion pledged in 2009—starting from 2025 to tackle their growing climate challenges effectively.

This ongoing debate highlights the significant gap between what developed countries are willing to offer and what developing nations deem necessary to combat climate change impacts effectively.