### Poorer Nations Require $1 Trillion Annually in Climate Finance by 2030, Study Finds

A recent study has revealed that low-income countries need $1 trillion each year in climate finance by 2030, a timeline that precedes when wealthier nations are likely to commit such funds at United Nations climate discussions. The Independent High-Level Expert Group on Climate Finance has warned that waiting until 2035 for this funding would impose severe burdens on vulnerable countries.

This report surfaced as nearly 200 governments negotiate the extent of financial support wealthier nations should offer and how much can come from other sources at the Cop29 summit in Azerbaijan. The summit in Baku saw world leaders departing, leaving their ministers to finalize a new global climate finance plan, which is to be concluded by next week. However, significant disagreements persist, particularly over how much money should be provided and from which sources.

The current focus of the talks is a target of $1 trillion annually for poorer countries by 2035, based on an earlier study by the Independent High-Level Expert Group. The 2022 study indicated that roughly $2.4 trillion per year is needed, with about half potentially sourced from these countries' own budgets, leaving around $1 trillion to be funded externally, including aid from richer countries.

The latest report, however, emphasized that by delaying until 2035, developing countries, excluding China, would require $1.3 trillion annually. Delaying the $1 trillion goal could exacerbate future challenges. Economist Lord Stern noted that achieving $1 trillion by 2030 is feasible for rich countries, but requires swift and genuine commitment. According to Stern, the funding could come from various sources: half from private sector investments, $250 billion from multilateral development banks like the World Bank, and the rest from diverse sources, including direct grants from wealthy nations, special drawing rights from the International Monetary Fund, and new taxes such as those on aviation and shipping.

Mohamed Adow, director of Power Shift Africa, welcomed the study’s recognition of the need for substantial climate finance, validating the demands from developing countries at Cop29. He highlighted the necessity of public, grant-based finance to address adaptation needs, which profit-driven private finance fails to meet.

The primary point of contention at Cop29 is funding for poorer nations. Under the 2015 Paris climate agreement, rich countries are obliged to support poorer nations. This year, they must establish a "new collective quantified goal" detailing how they will fulfill these responsibilities. Wealthier countries agree on financial support but aim to source a significant portion from the private sector. Additionally, some nations advocate for new taxes to contribute to the required funds. Rich countries also expect contributions from petrostates and large, emerging economies with high greenhouse gas emissions, such as China.

Harjeet Singh, global engagement director for the Fossil Fuel Non-Proliferation Treaty Initiative, emphasized that substantial funding is essential to transform economies and manage escalating climate impacts. He warned that if Cop29 fails to set a meaningful climate finance goal, everyone will suffer as climate devastation continues to worsen.

Yalchin Rafiyev, the lead negotiator from the host country, acknowledged that talks were progressing as expected. The discussions received a positive boost from the World Bank and other multilateral development banks doubling their key climate finance commitments to $120 billion annually by 2030. However, a high-level executive from a public finance institution stated that this pledge was insufficient, indicating that the development banks could do more.