As Paris climate change agreement is signed in New York, developing country negotiators highlight gulf between ambition and funding
April 22, 2016 — Developing countries must raise more than $4tn (£2,456bn), or roughly the entire annual budget of the US, to implement their climate change pledges by 2030, according to new research.
But much more money will have to be be found by the world’s poorest countries to hold global temperatures enough to avoid catastrophic climate change, say British and Australian researchers who have analysed the financial implications of the pledges made to the UN last December and the money so far offered by rich countries.
As 170 countries meet on Friday in New York to sign the Paris agreement and potentially set the world on a low-carbon development path from 2020, developing country negotiators called for a reality check, saying there was a vast financial gap between the world’s climate change ambition and the reality of funding the emissions reductions needed to avoid catastrophic warming.
To date, rich countries have only agreed to mobilise $100bn a year for developing countries to act on climate after 2020. They have also pledged $10.3bn to the Green Climate Fund, the UN-backed mechanism that will disburse money for climate change adaptation and mitigation.
“Mobilising trillions of dollars of climate finance, not hundreds of billions, is the new business as usual,” said Seyni Nafo, chair of the African group of 54 countries.
The new analysis, based on earlier work by Carbon Brief, shows that about $4.1tn will be needed to fund the emission cuts of the 70-odd countries that have so far identified how much it will cost them. These countries together emit only about 25% of total developing country emissions.
India has said it will need nearly $1tn to meet its pledge, but China and many other large developing countries have not published their estimates. This, say negotiators, suggests the real cost for poor countries to meet the obligations they signed up to in Paris will be far higher than $4.1tn.
For years, developing countries have argued strongly that the financial burden of reducing emissions should fall largely on the rich, industrialised countries responsible for the bulk of historical climate change emissions. To reach agreement in Paris, developing countries softened their stance. But the question of who should pay for climate change still rankles deeply.
How the money will be found to cut developing country emissions is unclear. Nearly $500bn of the $4,000 billion needed has been explicitly requested by developing countries to come from international sources of finance, including public money, private investments and carbon markets. Developing countries have pledged to spend $81bn from their domestic budgets.
“Ramping up finance is the most important aspect. It is clear that we are still far from where we need to be. Even the staggering new figures cited in this report may still fall short of where we need to be,” said Thoriq Ibrahim, minister of environment and energy for the Maldives and chair of the Alliance of Small Island States, a UN grouping of 43 countries.
“The Paris agreement was a resounding success for the multilateralism. But the ambition gap that remains is huge. Countries must now put their money where their mouth is and close the gap,” said Tosi Mpanu-Mpanu, chair of the 43-strong least developed country group.
According to the UN Environment Programme, the world is on a path for a potentially catastrophic 3-3.5°C of warming.
“The $4tn is a wake-up call. [It] dwarfs the figures that the Paris agreement or the Green Climate Fund are talking about. We’ve been saying all along that $100bn is a floor, a target that has to be met by 2020 and scaled up massively thereafter – without using dodgy accounting tricks to make smaller amounts of real money look big”, said Brandon Wu, policy analyst at ActionAid.
Alison Woodhead of Oxfam said: “If all of today’s public funding for climate adaptation were to be divided among the world’s 1.5 billion smallholder farmers in developing countries, they would get just over £2 a year to cope with climate change.”
Mohamed Adow of Christian Aid said: “Governments are aware their current mitigation and finance pledges fall short of what is required. No one is pretending that climate change and finance is yet solved. The job is not over, in fact, it has just started.”