At the 29th Conference of the Parties (COP29) to the United Nations Framework Convention on Climate Change (UNFCCC) in Baku, Azerbaijan, a global climate finance target of $300 billion per year was adopted on November 24, 2024. While the deal was intended to help developing countries tackle the devastating impacts of climate change, many of the targeted recipients have strongly denounced the agreement, calling it “an insult.”
Developing nations had been seeking more than $1 trillion in financial support to adequately address the complexities of the climate crisis, particularly with regard to the urgent energy transitions required in low-income countries. Instead, the agreed-upon figure of $300 billion annually, with a goal to reach $1.3 trillion by 2035, fell far short of expectations, leading to widespread frustration and disappointment at the conference.
U.N. Secretary-General Antonio Guterres expressed his own disappointment, taking to social media to voice his concerns. He had hoped for a more ambitious outcome on both financial commitments and climate mitigation efforts. “The agreement is a base on which to build. It must be honoured in full and on time. Commitments must quickly become cash,” he stated, highlighting the need for swift and substantial action.
As the deal was finalized, representatives from several developing countries lambasted the agreement, calling it “chaotic, poorly managed, and a complete failure in terms of delivering the ambition required.” For many, the deal did not go far enough in addressing the severe climate risks facing vulnerable nations. Negotiations had been tense, with delegates from the least developed countries and the Alliance of Small Island States (AOSIS) reportedly walking out in protest over the outcome.
The COP29 agreement does outline important next steps, including the creation of a global carbon market to incentivize emission reductions through the trading of carbon credits. While this may encourage countries to invest in climate-friendly projects, the financial commitments made remain at the core of the controversy. These funds are crucial for the transition of energy-intensive industries in developing nations from fossil fuels to renewable sources, a shift needed to limit global warming to below 1.5°C—beyond which the consequences of climate change will become even more catastrophic.
While some see the $300 billion target as a starting point for further action, many developing countries argue that it is an inadequate and insulting figure that fails to meet the true scale of the climate crisis. However, the European Union’s delegation defended the deal, suggesting that it would attract significant private investment, which could help achieve the $1.3 trillion target. The EU emphasized the need for a larger influx of private capital to address the climate challenges ahead.
Despite the tensions and unmet expectations, COP29 also made progress in other areas, such as reaffirming commitments to reduce emissions, accelerate the global energy transition, and continue working on carbon market regulations. UN Climate Change Executive Secretary Simon Stiell characterized the new climate finance goal as an “insurance policy for humanity.” However, he emphasized that, like any insurance policy, it would only succeed if the promised funds were paid in full and on time.
As COP29 concluded, the future of global climate finance remained uncertain. For developing nations, the real challenge lies in turning commitments into tangible financial support that can drive the transition to a low-carbon, sustainable future.