EU Raises Climate Finance Offer to $300 Billion Amid Tense COP29 Talks

In a bid to salvage the COP29 climate talks in Baku, Azerbaijan, the European Union has increased its annual climate finance offer to $300 billion for developing nations grappling with the devastating impacts of climate change. This comes after developing countries rejected an earlier $250 billion proposal as insufficient.

Negotiators, working overtime in a packed sports stadium, faced a critical standoff as the conference extended beyond its scheduled end. With 2024 likely to be the hottest year on record, the stakes are high for nations disproportionately affected by rising temperatures, droughts, and natural disasters.

Conditions Tied to the Offer

The revised $300 billion proposal by wealthy nations, including the EU, United States, Britain, and Japan, is contingent on key elements of the broader climate deal. Chief among these is an annual review of global progress in phasing out fossil fuels—the primary drivers of global warming.

However, this demand has met resistance, particularly from Saudi Arabia, which has sought to dilute commitments made at COP28 to transition away from oil, coal, and gas.

Irish climate minister Eamon Ryan expressed cautious optimism, emphasizing the need for a deal that balances increased financial support for vulnerable nations with decisive action against fossil fuels. “We need to show the world that multilateralism works and that we’re addressing the climate crisis,” Ryan stated.

Developing Nations Demand More

Developing nations have remained steadfast, with Ali Mohamed, chair of the African Group of Negotiators, describing the initial $250 billion offer as “a big mockery.” He noted progress in discussions but warned that a lack of substantial movement could derail the conference.

“No deal is better than a bad deal,” Mohamed asserted, a sentiment echoed by over 300 activist groups urging developing nations to resist inadequate financial commitments from wealthier countries.

In their letter, activists accused developed nations of shirking legal obligations for climate finance, endangering billions of people and ecosystems.

Political Challenges for Wealthier Nations

Wealthy countries argue that further increases in direct government funding are politically unfeasible. The recent election of Donald Trump, a skeptic of climate change, as U.S. President-elect has heightened concerns about waning support for international climate initiatives. Meanwhile, other Western nations are grappling with right-wing backlash against green policies.

The draft deal under negotiation sets a broader goal of $1.3 trillion annually to combat climate impacts, though most funding would come from private sources. Current commitments stand at $100 billion annually—a figure set to expire and widely regarded as inadequate.

Saudi Resistance and Emerging Economies

Saudi Arabia, a major oil producer, has resisted language aimed at phasing out fossil fuels. Similarly, the U.S. and EU have pushed for contributions from emerging economies like China, the world’s largest emitter. While China has cooperated during the talks, it insists on voluntary contributions, given its classification as a developing nation under the UN framework.

German Foreign Minister Annalena Baerbock criticized Saudi efforts, warning they were aimed at “turning back the clock.”

A Struggle for Progress in Baku

Azerbaijan, the host nation reliant on oil and gas exports, has faced scrutiny for its ability to manage the complex negotiations. President Ilham Aliyev opened the conference with remarks praising fossil fuels as a “gift of God,” reflecting the challenges of balancing diverse global interests.

As COP29 drags on, the outcome remains uncertain, with the future of climate finance, fossil fuel commitments, and multilateral cooperation hanging in the balance.