Cop29 secures last-minute $300bn climate finance deal as talks saved from collapse

A last-minute $300bn climate finance deal has been secured at Cop29 after a dramatic day of prolonged negotiations, which saw walkouts by vulnerable nations and protests echoing through the corridors.

Countries agreed to the annual finance target to help poorer countries deal with the impacts of climate change, with rich countries leading the payments, according to a hard-fought agreement clinched at the United Nations summit in Azerbaijan on Sunday, which saved the talks from collapse.

It is not near the full amount of $1.3 trillion that developing countries were asking for, but it is three times the $100bn a year deal from 2009 that is expiring.

The treaty acknowledged the need for $1.3 trillion and called for mobilising that amount annually through various sources.

The fresh agreement was criticised by developing nations, who called it insufficient, but UN climate chief Simon Steill hailed it as an insurance policy for humanity.

"It has been a difficult journey, but we've delivered a deal," Mr Steill said after the agreement was finalised.

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“This deal will keep the clean energy boom growing and protect billions of lives. It will help all countries to share in the huge benefits of bold climate action: more jobs, stronger growth, cheaper and cleaner energy for all.

“But like any insurance policy, it only works if the premiums are paid in full and on time.”

Fiji delegation chief Biman Prasad said: “Everybody is committed to having an agreement. They are not necessarily happy about everything, but the bottom line is everybody wants a good agreement.”

US President Joe Biden said that while “substantial work” remained to be done, the conference had set an “ambitious international climate finance goal”. He added: “While some may seek to deny or delay the clean energy revolution that’s under way in America and around the world, nobody can reverse it – nobody.”

The Cop29 climate conference in the Azerbaijan capital Baku had been due to finish on Friday, but ran into overtime as negotiators from nearly 200 countries struggled to reach consensus on the climate funding plan for the next decade.

At one point delegates from poor and small island nations walked out in frustration over what they called a lack of inclusion, worried that fossil fuel producing countries were seeking to water down aspects of the deal.

An initial proposal of $250bn, drafted by Azerbaijan’s Cop29 presidency on Friday, was denounced by vulnerable countries and campaigners as a “joke” and “insult” to the victims of climate disasters.

“We walked out because at the moment, we don’t feel that we are being heard,” said the representative from Samoa.

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In the early hours of Friday, negotiators were wrangling over every word of the text to be able to provide assurance to vulnerable nations of the delivery of the finance they need. Rich countries have repeatedly failed to provide the previous $100bn climate finance, with the target only completed for the first time in 2022.

UN secretary general Antonio Guterres, said the “commitments must quickly become cash”.

“Developing countries swamped by debt, pummelled by disasters, and left behind in the renewables revolution, are in desperate need of funds. I had hoped for a more ambitious outcome – but this agreement provides a base on which to build. It must be honoured in full and on time.”

Andreas Seiber, associate director of policy at climate advocacy 350.org said the new fund is a “step forward compared to where we stood before on climate finance” but “falls far short of what is required for true climate justice”.

“Rich nations, led by the EU, USA, and Japan, took steps that were long overdue, but their actions remain insufficient to meet the scale of the crisis or to uphold their historic responsibilities,” he told The Independent.

After the deal was formally adopted by consensus, India strongly objected to the agreement.

“I regret to say that this document is nothing more than an optical illusion. This, in our opinion, will not address the enormity of the challenge we all face,” Indian delegation representative Chandni Raina told the closing plenary session of the summit.

Campaigners had been calling for developing countries to reject the proposal. The fast-emptying corridors of Baku Stadium, which were once filled with thousands of people walking around at pavilions and cafes, were just echoed by chants of “pay up”.

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John Podesta, the US climate envoy, was met with demonstrators shouting “shame” as he walked out of a meeting.

The Cop29 summit had been dampened by tricky geopolitical challenges since its start, with Donald Trump’s election victory in the US putting it on track for another withdrawal from the Paris Agreement. Several Western leaders were absent from this year’s conference and many countries have challenging elections.

Wopke Hoekstra, the EU commissioner for climate action said: “We are living in a time of truly challenging geopolitics so seeing a deal truly is exceptional.”

The summit cut to the heart of the debate over financial responsibility of industrialised countries – whose historic use of fossil fuels have caused the bulk of greenhouse gas emissions – to compensate others for worsening damage wrought by climate change.

It also laid bare divisions between wealthy governments constrained by tight domestic budgets and developing nations reeling from costs of storms, floods and droughts.

On Saturday evening, countries also agreed on rules for a global market to buy and sell carbon credits that proponents say could mobilise billions more dollars into new projects to help fight global warming, from reforestation to deployment of clean energy technologies.

Countries are seeking financing to deliver on the Paris Agreement goal of limiting global temperature rise to 1.5C (2.7F) above pre-industrial levels – beyond which catastrophic climate impacts could occur.

The world is currently on track for as much as 3.1C (5.6F) of warming by the end of this century, according to the 2024 UN Emissions Gap report, with global greenhouse gas emissions and fossil fuels use continuing to rise.