The New Collective Quantified Goal on Climate Finance (NCQG) - COP29 Updates

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The New Collective Quantified Goal on Climate Finance (NCQG) is a new global climate finance goal that the Conference of the Parties serving as the meeting of the Parties to the Paris Agreement (CMA) shall set from a floor of USD 100 billion per year, prior to 2025. This new goal will be set in the context of meaningful mitigation actions and transparency on implementation, taking into account the needs and priorities of developing countries. Deliberations on setting the new goal aim to strengthen the global response to the threat of climate change in the context of sustainable development and efforts to eradicate poverty, including by making finance flows consistent with a pathway towards low greenhouse gas emissions and climate-resilient development. 

The ad hoc work programme was established in 2021 to facilitate technical discussions on the NCQG, running from 2022 to 2024. The CMA will take stock of progress made in 2022 and 2023 and provide further guidance on the work programme. In 2024, the CMA (Baku) will set the NCQG. 

Relevant documents: 

 CGIAR submissions: 

Parties’ positions summary (from the High-level Ministerial, October) 

Scale Assessment
Needs are “well above 1 trillion dollars” (USA)
Current needs are in the trillions per NDR2 (AGN)
Must match the 1.5°C survival level (LDCs)
Must reflect total climate investments across public, private, domestic, international, and philanthropic sources (USA)

Resource Mobilization and Sources
Public vs Private Finance
Need to balance public and private finance (AGN)
Public grant finance for middle-income countries when leveraging private investment

Related events: 

  • 14 Nov – 6th High-Level Ministerial Dialogue on Climate Finance 
  • 19 Nov – High-Level Ministerial Dialogue on Adaptation finance 

CGIAR Submission (TED11): Regarding the quantum, CGIAR highlights that it must align with national priorities (NDCs, NAPs) and the latest available scientific research, focusing on sustainable development, poverty reduction, and food security. Prioritizing sectors like agriculture, water, and agrifood systems to ensure global food security, with an estimated $300-400 billion needed annually to transform these systems to align with the 1.5-degree target. A balanced financial allocation between adaptation, mitigation, and loss and damage is essential.  

Regarding qualitative elements, financial support should focus on climate-impacted communities, particularly in developing nations such as LDCs and SIDS. Mobilized climate finance should drive transformative change toward low-emission, climate-resilient development, focusing on resilient food production, sustainable land use, and climate-smart technology. Emphasis on grants, highly concessional finance, and non-debt instruments is crucial for adaptation, loss, and damage, with a need to clearly define eligible climate finance tools under the Paris Agreement. 

COP29 Day 2 Updates, November 12, 2024

Session 1 New collective quantified goal on climate finance – Contact group: CMA 11 (a) 2  

Areas of Agreement 

  1. Ambition and Alignment with the Paris Agreement

Several nations, particularly those in developing regions, highlighted the need for a climate finance goal that supports the Paris Agreement’s objectives, emphasizing that this finance should be new, additional, and predictable. Developing countries, urged for a climate finance goal of at least $1 trillion annually to meet ambitious climate targets.   

  1. Support for Vulnerable Nations

Countries widely agreed on the need for direct grant-based adaptation finance, with the African Group and Nepal underscoring the vulnerability of LDCs and SIDS. The United Kingdom emphasized that “financing terms must be favorable for the most vulnerable”.  

  1. Enhanced Transparency and Accountability

There was consensus on improving transparency to prevent double-counting and maintain accountability in climate finance. The African Group of Negotiators emphasized that climate finance must be additional and non-concessional finance should not count as climate finance. 

  1. Clear Access Mechanisms

Many nations emphasized the importance of streamlined and accessible climate finance mechanisms. Nepal highlighted the need to simplify access for LDCs, advocating for low transaction costs and reduced bureaucratic barriers. 

More finance needs to flow through the finance mechanisms of the UNFCCC, developing countries propose an increase of flows through the mechanisms from the current 2, to 20% atleast for the NCQG. 

  1. Integration of Socio-Environmental Considerations

Some developed countries called for climate finance that integrates socio-environmental aspects, including gender equality and Indigenous rights, while others argued these could dilute the NCQG’s focus on climate objectives alone.  

Areas of Disagreement 

  1. Quantum of Finance

While developing countries, led by the G77 and China, LMDCs, African Group, LDC’s AOSIS, Arab Group, and others, called for a dedicated quantum of $1.3 trillion annually specifically for developing countries, developed nations hesitated to commit to targets, advocating for flexibility and broader investment inclusion.  

  1. Broadening the Contributor Base

Some developed nations proposed expanding the contributor base to include emerging economies, contending this would mobilize sufficient resources. However, developing countries opposed this suggestion, asserting that climate finance should come from historically responsible nations. The Arab Group criticized this as a distraction from developed countries’ obligations, emphasizing the importance of “upholding historical responsibilities without shifting burdens onto developing nations”. 

  1. Investment Goal vs. Provision Target

Some developed countries, supported incorporating private sector investment in the NCQG, also highlighting the role MDBs play and that considerations in relation to their expected role and contribution. They argued that public finance alone was insufficient to meet ambitious climate targets. In contrast, developing nations argued that climate finance should not be equated with investments, which may dilute responsibility, and that the NCQG should prioritize provision targets over investment goals. 

  1. Conditionalities and Access Issues

Developing countries, especially those within the African Group and LMDC, voiced concerns over conditionalities attached to climate finance, arguing these restrictions hindered equitable access. They requested unconditional finance for adaptation and loss and damage. The Tanzanian delegation stated, “NCQG should not increase burdens but provide finance without restrictive conditions”. 

Additional Critical Points 

  1. Human Rights and Equity Considerations

Brazil and other nations underscored the importance of aligning climate finance with human rights frameworks. They asserted that climate finance should prioritize equitable access and the inclusion of vulnerable groups, including youth and Indigenous communities. 

  1. Addressing High Transaction Costs and Currency Risks

Nations such as Colombia and Bhutan highlighted the challenges posed by high transaction costs and currency risks in accessing climate finance, with Bhutan advocating for public finance to be directly channeled through accessible mechanisms which also reach the local level. 

  1. Debt Forgiveness and Financial Sustainability

Many countries, particularly from the African Group, requested financial mechanisms that prevent the increase of climate-related debt burdens. There was a call for debt forgiveness as part of the climate finance framework, emphasizing that finance should strengthen, not strain, fiscal capacity in developing nations. 

COP29 Day 3 Updates, November 13, 2024

Informal Consultation on CMA 6 Agenda Item 11(a): New Collective Quantified Goal on Climate Finance 

This meeting had the purpose of consulting parties on the Co-Chairs’ proposal for the First iteration of a draft decision text on CMA 6 agenda item 11(a): New collective quantified goal on climate finance. 

The informal consultation highlighted widespread appreciation for the co-chairs’ efforts in refining the text. Delegations from the UK, Norway, and EIG praised the improvements but called for further consolidation to enhance coherence. The G77 and China underscored the importance of simplifying and streamlining the document to ensure readiness for the next session. Similarly, the EU and Norway emphasized reducing duplication, particularly in references to gender, Indigenous Peoples, and youth rights, to create a more consistent and unified framework. 

Specific areas for consolidation were proposed, with Canada and the EU identifying paragraphs as containing overlapping themes related to rights and inclusivity. They suggested integrating these into a single, cohesive framework to improve clarity. Financial needs and access mechanisms were also flagged by the UK and EIG as requiring a unified approach, particularly in aligning bilateral and multilateral funding channels to support equitable and effective resource allocation. 

In terms of next steps, the UK, Norway, and EIG proposed informal meetings to refine the text further, focusing on the quality of finance, transparency, and inclusive access mechanisms. There was a strong emphasis on streamlining multilateral access points to ensure all parties, especially vulnerable groups, benefit equitably. This collaborative approach aims to enhance the document’s effectiveness and alignment with the needs of diverse stakeholders. 

COP29 Day 4 Updates, November 14, 2024

Despite the urgent deadline, progress has been slow to streamline and move forward the draft and the text remains lengthy and complex. 

Key issues and concerns raised by the parties include: 

  • Length and Complexity: Many parties, expressed concerns about the length and complexity of the text. They urged for streamlining and focusing on key issues. 
  • Human Rights and Indigenous Peoples: Canada and Norway emphasized the importance of incorporating strong language related to human rights, gender, children’s rights, and indigenous rights. 
  • Access to Finance: The UK and EU highlighted the need for addressing issues related to access to finance, sources, and instruments. 
  • Transparency and Accountability: G77-China proposed discussing transparency, access, and enablers topics, focusing on specific sections. 
  • To move forward, parties have proposed various approaches: 
  • Informal Consultations: Canada, Norway, and the EU suggested working in informal groups to facilitate discussions and find common ground. 
  • Targeted Streamlining: New Zealand identified specific sections that could be streamlined, such as those related to the cost of capital. 
  • Compromises and Prioritization: EIG called for compromises on certain content to address major substantive issues and prioritize key elements like access, policy elements, and the effective use of the timeline. 

COP29 Day 5 Updates, November 15, 2024

After various delays of the informal consultation and two different informal informal meetings, Parties have agreed to provide input to further streamline paragraphs and will provide their comments and inputs by 7am on Saturday. The last contact group is scheduled for 10am.

COP29 Day 6 Updates, November 16, 2024

A new draft text was released, with ongoing debates about key issues such as the total funding amount, review timelines, and access. Political divisions between developed and developing nations persisted, particularly over whether the goal should be a single-layer or multi-layered framework. While some progress was noted on transparency mechanisms and maintaining the agreed scope of elements, substantive agreements on critical issues remained elusive. Parties praised the Co-Chairs and Secretariat for their facilitation, while significant work lies ahead of week two.

COP29 Day 7 Updates, November 18, 2024

In the stocktake plenary, the COP President stated that a two-pronged approach will be undertaken. Ministerial consultations with all groups will be conducted in relation to the structure, quantum, and contributors, while technical work will continue in relation to transparency and access. A full draft text is expected by Wednesday evening at the earliest. 

Closed meetings took place throughout the day, with Parties working on language on transparency and access early in the evening, and the Presidency engaging in ministerial consultations later in evening. 

COP29 Day 9 Updates, November 19, 2024

One closed Head of Delegation drafting group was convened during the afternoon, however the Parties couldn’t agree on how the text should look like. Another draft text is expected to be publish on Wednesday either during or after the Resumed High-Level Segment. 

COP29 Day 11 Updates, November 24, 2024

Final decision text here: https://unfccc.int/sites/default/files/resource/cma2024_L22_adv.pdf 

Plenary resumed around 3 am on Sunday and the Presidency went to the NCQG agenda item and very quickly gavelled the decision through. This was met with a standing ovation, followed by interventions from India, Bolivia, Nigeria, and Malawi on behalf of LDCs (almost 50 countries) objecting to different aspects of the decision, expressing their disappointment in the process and the outcome. India’s intervention was very strong saying they are extremely, extremely disappointed in both the process for the final decision and the text itself, and Nigeria calling it an insult. The EU intervened supporting the text but recognising it is not enough and assuring there is more finance to come, more discussions needed, and a broader contributor base required than where things current stand. The Presidency took note of the interventions and informed Parties their concerns will be mentioned in the final report. 

Acknowledgement

These negotiations were tracked, analysed and reported by: Pedro Chilambe, Laura Salfi, Steve Leonard, Lidya Tesfaye, Dorcas Jalango, and Issa Ouedraogo

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