COP29: A bad deal is better than no deal

Analysis: After contentious diplomatic negotiations such as COP29, people like to point out a platitude: a good compromise is one in which no one is happy.

However, when we discuss the climate crisis and all the human suffering it entails, shouldn’t we strive for an agreement that works, and not just one that is equally unsatisfactory for everyone?

Of course, no one leaves the Baku climate summit happy. However, some are much less happy than others.

Developed countries have successfully stuck to almost all of their red lines, keeping the total size of the new fiscal target low (hundreds of billions rather than trillions), opening the door for China and other emerging economies to contribute, and maintaining lending flexibility. based on financing and private investment.

Developing countries have been forced to swallow a dead rat by accepting emissions levels far below what even wealthy nations believe is needed to cut emissions and adapt to worsening climate chaos. Even when the funding does materialize, which could be ten years from now, it may just plunge them deeper into a growing debt trap.

Over the course of two weeks in Baku, developed countries made a tactical mistake by not putting out numbers earlier. Allowing activists and developing countries (and scientists and economists) to outline their hopes of reaching a trillion-dollar target starting next year, when rich countries knew they could only settle for something much lower, set the stage for bitter disappointment and mutual accusations in the final hours of the summit.

If the numbers had been discussed earlier, perhaps more compromises could have been made on the qualitative elements of the deal, which would have made things at least a little less unpleasant.

However, exceeding this tactical error is a much more serious strategic error. This is a decision by developed countries to so severely limit the funding they were willing to agree to in the first place.

At the heart of the Paris Agreement is a grand bargain: money to cut emissions. Developing countries are currently responsible for three-quarters of annual emissions, and while cumulative emissions have historically determined how hot the world gets, turning off the tap as quickly as possible is critical to limiting warming to 1.5°C.

By lowering the financial target, developed countries are undermining global efforts to end the climate crisis. Developing countries’ Paris emissions reduction targets, theoretically due to be achieved in the next two months, were always the best leverage they had on the table. Rich countries have effectively called the bluff of poorer countries.

But were they bluffing? Or will the new Paris targets for developing countries land and take the form of something completely insufficient to keep warming to 1.5°C or even 2°C?

This is a risk that rich countries have taken. It is unlikely that they will be able to break the path. While it is in the interests of poorer countries to invest in reducing emissions, if they have to choose between this and adapting to climate impacts, the latter will always win out. Developing countries don’t have much choice here – their actions in terms of how ambitiously they tackle climate change are dictated by the finances provided by the world of wealth, and those finances won’t be significant.

There are high hopes for a reset and alignment with 1.5C in Brazil at COP30. But a bad deal in Baku risks ruining it all.

The next front in the diplomatic climate debate may not be reducing greenhouse gas emissions as expected, but an attempt to reignite financial discussions once again.

Developing countries are understandably wary that the US$300 billion target by 2035 is a ceiling on financial ambition, not a floor. While this does represent a significant improvement on the $116 billion achieved in 2022, much of this amount will be eaten up by inflation over the coming decade.

It is hoped that the “soft” outer layer target of US$1.3 trillion of all financial flows, public and private, into developing countries to combat climate change by 2035 can serve as something of a stretch target. This could be the next area of ​​contention from developing countries seeking to recapture some of the finances that science says they need to play their part in the global effort to combat 1.5C.

In the final days of COP29 in Baku, chants of “no deal is better than a bad deal” have become common in the halls of the Olympic Stadium.

Activists have pressed developing countries to give up anything that doesn’t meet their high standards, including trillions of dollars in public finance starting this decade.

However, if this advice were accepted, it would also be a strategic mistake. Despite all the shortcomings of the Baku deal, it was the best possible. The only deal, really.

The counterfactual was not to return to negotiations in Brazil next year, where developing countries hold all the cards. Instead, one would have to return to the negotiating table to find that America has walked away and some other countries, such as Canada and Germany, which may be represented by right-wing governments, are much less willing to agree to increased climate change funding.

No deal would provide the developing world with less funding, not more. And it would also further undermine already shaky faith in multilateralism following poor results at the G20 and rising geopolitical tensions at the United Nations.

Baku has indeed shown that countries can still come together and do the painful work of compromise and negotiation. From a nadir on Saturday afternoon, when negotiations seemed on the verge of collapse, to historic success just hours later, COP29 proved that diplomacy can still achieve results.

It also showed that, despite the imminent absence of the United States, power had not yet fully transferred from the developed to the developing world. Rich countries are still in charge.

But it won’t always be like this. The balance of power is changing. And when that happens, the developing world will remember how it was treated at COP29.