The 29th United Nations Climate Change Conference (COP29) concluded on Sunday in Baku, Azerbaijan, with a nuanced outcome, as international negotiators reached a compromise on climate financing while struggling to make significant progress on comprehensive emissions reduction strategies.
Financing Framework: A Delicate Diplomatic Compromise
After intense negotiations that stretched into the early hours of Sunday morning, delegates crafted a climate financing agreement representing both a breakthrough and a disappointment.
The headline commitment: mobilising at least $300 billion annually by 2035 for climate action, a figure substantially lower than the $1.3 trillion initially demanded by developing nations.
The agreement’s complexity lies in its flexible funding approach, allowing contributions from public, private, bilateral and multilateral sources.
This structure resulted from marathon negotiation sessions, with many diplomats extending their stays in Baku to hammer out the final text.
Developing countries voiced significant criticisms; India, in particular, emphasised that the agreed public funding fell far short of what was needed to support nationally determined contributions (NDCs) and adaptation plans. Contentious issues included:
The inclusion of market-rate loans
Potential reliance on carbon market-backed projects
Resistance to mandatory contributions from emerging economies
A unique compromise emerged with the text “encouraging” developing nations to contribute voluntarily, specifically targeting emerging economies like China and Gulf states. So far, only South Korea has demonstrated a consistent willingness to contribute, with its US$300 million contribution to the Green Climate Fund.
Breakthrough in Carbon Market Regulations
Perhaps the most concrete achievement of COP29 was the breakthrough in carbon market regulations under Article 6 of the Paris Agreement. After years of complex negotiations, countries finally established a comprehensive international carbon credit trading framework.
Article 6.4 Mechanism
The UN supervisory body adopted groundbreaking methodological standards that require:
Comprehensive risk assessments by project developers
Demonstrated contributions to sustainable development
Specific processes for authorising emission reductions
Mechanisms for transferring legacy Clean Development Mechanism (CDM) projects
Article 6.2
Article 6.2 outlines the framework for voluntary bilateral agreements between countries to trade carbon credits, referred to as international transferred mitigation outcomes (ITMOs). During COP29, discussions regarding Article 6.2 centred on the technical aspects of how these bilateral agreements can be authorised and the conditions under which such authorisation can be reversed or revoked.
The agreed text details the procedural requirements needed for the authorisation of these agreements for trading ITMOs. Additionally, it specifies that the revocation of authorisation can only take place if the conditions outlined in the text for authorisation are met.
International Registry and Bilateral Agreements
A dual-layer approach was agreed for the international registry, primarily designed to compile and display data. The registry will also be able to hold internationally transferred mitigation outcomes (ITMOs) as sovereign carbon credits.
Modest Pledges Amid Significant Challenges
Positive Commitments
Several notable smaller developments provided glimmers of hope:
Thirty states, including Brazil and the United States, pledged to reduce methane emissions from organic waste
Twenty-five countries and the European Union committed to avoiding new unabated coal power plants
Unresolved Negotiations
However, progress remained limited in critical areas. The Mitigation Work Programme, launched in 2022 to guide countries’ emission reductions, saw no meaningful discussion of the previous year’s Global Stocktake commitments to phase out fossil fuels. A small bloc of emerging economies, led by Saudi Arabia, effectively blocked further discussions on fossil fuel reduction. The Just Transition Work Programme, aimed at supporting communities affected by energy transitions, similarly saw negotiations grind to a halt.
Future Outlook: COP30 and Expectations
With COP30 scheduled in Belem, Brazil, expectations are already building. The conference’s location in the heart of the Amazon rainforest is expected to shift focus toward nature, biodiversity, and climate loss.
Environmental advocates and policy experts are hopeful for more substantive commitments. The symbolic nature of the upcoming conference — marking another milestone in international climate negotiations — suggests the potential for more ambitious agreements.
Analysis: A Complex Diplomatic Landscape
The outcomes of COP29 defy simple characterisation. While the carbon market regulations represent a significant diplomatic achievement, the climate financing agreement and limited progress on emissions reduction highlight the persistent challenges of global climate negotiations.
Balancing economic interests, addressing historical inequities between developed and developing nations, and mustering collective political will remain formidable obstacles.
As global temperatures continue to rise and climate impacts become increasingly severe, the modest achievements of COP29 underscore both the complexity and the necessity of international cooperation.
The conference ultimately demonstrated that while global consensus remains difficult, the commitment to dialogue and incremental progress continues.
The views expressed here are those of the writer and do not necessarily represent the views of the Sarawak Tribune.
