CLIMATE ACTION
COP29 in Baku achieved a tripling of climate finance
The Baku Climate Unity Pact and the art of implementation
T he transition from the ambitious goals of COP28 to the critical implementation of COP29 was driven by the understanding that without a robust financing plan, the targets set in the UAE would remain just words. In Baku, the parties took on the task of agreeing a new collective quantified goal (NCQG) for climate finance, a successor to the earlier US$100 billion target. For many years, the lack of delivery on climate finance has been a major source of frustration. Promises were made but rarely kept and developing countries correctly pointed out that they could not be expected to transition their economies and adapt to climate impacts without adequate support.
Through the Baku Climate Unity Pact the parties agreed to channel at least US$300 billion annually to developing countries by 2035, with an overall goal to mobilize US$1.3 trillion. While this outcome was significant given the geopolitical dynamics, developing countries remain concerned about the
gap between this target and actual needs – estimated to be US$5.9 trillion by the 2021 Needs Determination Report by the UNFCCC’s Standing Committee on Finance. The corresponding lack of ambition on mitigation was also of concern to parties and partners, while it was understood that there can be no ambition without finance. Finance is the lifeblood of climate action, the necessary means to deliver on both mitigation and adaptation.
An agreement was reached to mobilize US$1.3 trillion for developing countries, but a UNFCCC report estimated the amount needed to be four times larger.
The role of international financial institutions
The call to mobilize climate finance at scale requires a coordinated response from all stakeholders, including international financial institutions (IFIs). The Sharm El- Sheikh Implementation Plan from COP27 under the Egyptian Presidency was the first to call on IFIs to step up efforts. The OPEC Fund has heeded this call, adopting its first Climate Action Plan in 2022, which set targets that cover a comprehensive approach to climate mitigation, adaptation, food security and nature-based solutions. Upon reaching these initial targets, in September 2025, the OPEC Fund Governing Board approved new climate financing targets to achieve 60 percent alignment with the Paris Agreement by 2027 and 80 percent by 2030, excluding trade finance (see page 13). More information can be found in the annual OPEC Fund Climate Finance Report .
COP29
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