by Luca Farkas
The 29th United Nations Climate Change Conference (COP29), held in Baku, Azerbaijan, concluded on November 24th, 2024, marking a pivotal moment in the global fight against climate change. With nearly 200 countries in attendance, this year's conference revolved around one of the most pressing issues in global climate action: climate finance.[1]
As the world grapples with the escalating impacts of climate change, COP29 provided a platform for nations to come together and find common ground on how to finance the transition to a more sustainable and resilient future. However, while some major milestones were reached—such as the historic climate finance agreement and the operationalization of carbon markets—reactions to these outcomes were mixed, raising important questions about the true effectiveness of the deals in addressing the scale of the crisis.
The Legal and Historical Context of COP
The annual United Nations Climate Change Conference, commonly known as "COP" (Conference of the Parties), is the world’s foremost platform for addressing climate change. As the decision-making body of the United Nations Framework Convention on Climate Change (UNFCCC), established in 1992 to tackle global climate challenges, COP brings together nearly 200 countries each year.[2] It provides a critical space for these nations to negotiate and set the direction for international climate action.
Following COP27, which established the historic Loss and Damage Fund,[3] and COP28, which reached a global agreement to transition away from fossil fuels, triple renewable energy capacity by 2030, and strengthen climate resilience,[4] COP29 took significant steps forward by setting a new climate finance goal.
Two Major Milestones from COP29
1. Historic Climate Finance Agreement
During COP29, following two weeks of intense negotiations and several years of groundwork, a historic agreement was reached, formally known as the New Collective Quantified Goal on Climate Finance (NCQG).[5] The NCQG represents a breakthrough in global climate finance, with key outcomes aimed at significantly increasing the flow of funds to developing countries. These outcomes include:[6]
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- Increasing financial support to developing countries from the previous target of USD 100 billion annually to USD 300 billion annually by 2035.
- Securing collaborative efforts from both public and private sources to scale up finance to developing countries, with the goal of reaching USD 1.3 trillion per year by 2035.
The Executive Secretary of UN Climate Change, Simon Stiell, described the new climate finance goal as "an insurance policy for humanity," emphasizing that it will only be effective if the commitments are fully met and delivered on time.[7]
2. Agreement on Carbon Markets
At COP29, countries also reached an agreement on how carbon markets will operate under the Paris Agreement, the legally binding treaty adopted at COP21.[8] Article 6 of the Agreement outlines how countries can engage in voluntary cooperation to meet their climate goals through country-to-country trading and a carbon crediting mechanism. With the latest agreement at COP29, these mechanisms are now fully operational, potentially reducing the cost of implementing national climate plans (Nationally Determined Contributions or NDCs) by up to $250 billion per year.[9] This is seen as a significant step toward making climate action more cost-effective and accelerating global emissions reductions.
Mixed Reactions to the New Climate Finance Goal
Reactions to the new finance goal at COP29 were mixed, with some expressing strong disappointment. India’s delegate, Chandni Raina, voiced frustration, describing the agreement as "little more than an optical illusion", emphasizing that the deal would not adequately address the scale of the climate crisis.[10] Similarly, Greenpeace called the final agreement „woefully inadequate” and criticised in particular that references to the „Make Polluters Pay” principle were removed at the last hour.[11] This economic and legal concept, central to the European Union’s environmental policy, holds polluters accountable for environmental damage[12] and was seen by many as a crucial element for ensuring fairness in climate finance. Despite the positive rhetoric surrounding the new climate finance target, many activists argue that without stronger accountability measures and meaningful financial commitments, the goal risks falling short of its potential to drive real change.
Trump’s Shadow and China’s Ascendant Role in Global Climate Leadership
With the re-election of Donald Trump, the future role of the United States in climate action became uncertain. On one hand, this uncertainty impacted negotiations in Baku at COP29, as negotiators had to ensure that international climate agreements could withstand the potential rollback of U.S. commitments under a second Trump administration. On the other hand, this opened the door for China to potentially emerge as the "real climate leader."[13] While largely silent at COP29, China has become more transparent about its climate finance contributions to the global south. Despite being classified as a "developing" country by the United Nations with no formal obligation to reduce emissions or provide financial aid to poorer nations, China has increasingly taken steps to play a larger role in global climate efforts.
Looking Ahead: Key Moments for Climate Action in 2025 and 2027
COP30, scheduled for 2025 in Belém, Brazil, will be a critical moment in advancing global climate action.[14] As nations prepare for the summit, attention will turn to the 2025 deadline for submitting enhanced Nationally Determined Contributions (NDCs).[15] NDCs are the climate action plans that countries voluntarily submit to the UNFCCC as part of their commitments under the Paris Agreement.[16] These plans outline the specific steps each country intends to take to reduce greenhouse gas emissions, adapt to the impacts of climate change, and contribute to global efforts to limit global warming. By strengthening their NDCs, countries aim to align their actions with the goal of the Paris Agreement to keep global temperature rise well below 2°C, and preferably limiting it to 1.5°C.[17] In 2027, the Intergovernmental Panel on Climate Change (IPCC) will release its Special Report on Climate Change and Cities, providing critical data and solutions to address emissions and risks in urban areas.[18] This report will play a key role in shaping the transition to a sustainable, low-carbon future, particularly in the world’s growing cities.
[1] UNFCCC, COP29 UN Climate Conference Agrees to Triple Finance to Developing Countries, Protecting Lives and Livelihoods, 24.11.2024. https://unfccc.int/news/cop29-un-climate-conference-agrees-to-triple-finance-to-developing-countries-protecting-lives-and, hereinafter: UNFCCC, COP29 Agrees to Triple Finance.
[2] UN, UN Climate Conferences, accessed 27.11.2024. https://www.un.org/en/climatechange/un-climate-conferences.
[3] UNDP, Loss and Damage Fund for Developing Countries, 26.01.2024. https://www.undp.org/belarus/stories/loss-and-damage-fund-developing-countries.
[4] UNFCCC, COP 28: What Was Achieved and What Happens Next?, accessed 27.11.2024. https://unfccc.int/cop28/5-key-takeaways.
[5] UNFCCC, COP29 Agrees to Triple Finance.
[6] Ibid.
[7] Ibid.
[8] Paris Agreement to the United Nations Framework Convention on Climate Change, Dec. 12, 2015, T.I.A.S. No. 16-1104, hereinafter: Paris Agreement.
[9] COP29, COP29 achieves full operationalisation of Article 6 of Paris Agreement - Unlocks International Carbon Markets, 23.11.2024. https://cop29.az/en/media-hub/news/cop29-achieves-full-operationalisation-of-article-6-of-paris-agreement-unlocks-international-carbon-markets, hereinafter: COP29, COP29 Achieves Operationalisation of Article 6.
[10] BBC, Matt McGrath, Huge deal struck but is it enough? 5 takeaways from a dramatic COP29, 24.11.2024. https://www.bbc.com/news/articles/cp35rrvv2dpo, hereinafter: BBC, McGrath, COP29 5 Takeaways.
[11] Greenpeace, Gaby Flores, COP29: A Long Way to Go, 24.11.2024. https://www.greenpeace.org/international/story/71482/cop29-long-way-go/.
[12] European Commission, Ensuring Polluters Pay Toolkit, accessed 27.11.2024. https://environment.ec.europa.eu/economy-and-finance/ensuring-polluters-pay_en.
[13] BBC, McGrath, COP29 5 Takeaways.
[14] IISD, SDG Knowledge Hub, 2025 UN Climate Change Conference (UNFCCC COP 30), accessed 27.11.2024. https://sdg.iisd.org/events/2025-un-climate-change-conference-unfccc-cop-30/.
[15] UNFCCC, COP29 Agrees to Triple Finance.
[16] Paris Agreement, Article 3. See also: UNDP, What are NDCs and how do they drive climate action?, 31.05.2023. https://climatepromise.undp.org/news-and-stories/NDCs-nationally-determined-contributions-climate-change-what-you-need-to-know.
[17] Paris Agreement, Article 2.1(a).
[18] IPCC, 2024, accessed 27.11.2024. https://www.ipcc.ch/2024/.
