Baku tries to unlock the most ambitious climate fund in history
These days we only talk about two things in Baku: money and salad. And as strange as it may seem, both questions relate to the larger goal of this year’s climate summit. Climate Finance Commitment The most ambitious in the history of these meetings. Even after a week of fruitless talks, there are still talks to be done Four questions that are echoing in the air: When money is really needed to save the planet and its inhabitants from climate destruction and, above all, who should raise this money, how and when. There are also those who talk about a target of at least a billion dollars per year (with a B) which is structured like the onion, avocado or who knows what other vegetable analogy. Everyone’s future depends on it.
The final phase of the summit begins this Monday in Baku, with negotiations still stalled and more doubts than certainties
And the basis of all conversations in Baku these days is that confronting the climate crisis requires a lot of money. For example, to accelerate the energy transition and leave fossil fuels behind Which are promoting climate chaos. or developing adaptation measures that can limit the damage caused by climate extremes Such as torrential rains, floods or long-term drought. According to a recent analysis led by economist Nicholas Stern and other climate policy advisers, the world needs Raise huge amount of money before 2030 Limiting the impacts of climate change in all corners of the planet.
Billions annually (with a B).
More than a decade ago, developed countries (which have historically been the most polluting countries in the world and are, therefore, primarily responsible for the climate crisis) He committed to raising $100,000 million per year To help our counterparts in the global South (who, despite emitting the least, bear the greatest burden of climate destruction) Decarbonize your economy and developing adaptation measures against the progression of climate change. This target is not only not met during the vast majority of the agreed period, but, as numerous analyzes show, it falls far short of the actual needs of developing countries. A recent report by the Baku Summit Group of Economic Advisers indicates that, at a minimum, This will cost at least a trillion dollars per year From now until the end of this decade.
A report suggests that developing countries will need at least one trillion dollars annually by 2030.
But these funds are not the only funds for the global South that must be unlocked as soon as possible. It is also estimated that developed countries need at least $2 trillion annually for their decarbonization and, in general, all climate action measures to address higher temperatures, extreme weather events or accelerated depletion of natural resources. it occurs. According to analyses, a part of these funds could come from the pockets of the governments themselves but the other part should be raised through private capital. ,These investments are not acts of charity, They are a matter of pure existence. “No country is untouched by the impact of this crisis,” UN Secretary-General Antonio Guterres said during his opening speech at the Baku climate summit.
public and private capital
Beyond this figure, the big debate going on in Baku these days concerns Who should raise this money Since, till now, the list of ‘donors’ has been limited only to the so-called developed countries like the United States, Europe or Japan. On the one hand, there are those who argue that all the world’s major economies are also included China, Russia, India or Petrostates From the Middle East, funds should be contributed for this cause. Especially considering the fact that Donald Trump may soon withdraw from all international climate agreements and leave a huge gap in funding. But on the other hand, there are also more and more voices that affirm that it is necessary Involve the private sector in this work To raise as much money as possible in the shortest time possible.
Pressure increases on countries like Russia and China to attract more private funding as they join the list of donors
With just a few days left for the summit to end, and given that all the debates are still stuck, there are those who point towards exploring ‘alternatives’ to increase climate financing. For example, Guterres chose to create taxes for aviation and maritime transport during his first intervention in Baku. A coalition of experts in “solidarity tax” has suggested creating a specific tax for the production of the largest asset on the planet, cryptocurrencies or plastic. Along these lines, it is estimated that Creation of a tax for the extraction of fossil fuels For example, up to 720 billion dollars will be raised annually from oil, coal and gas.
There are more and more voices advocating taxes on aviation, maritime transport and big wealth to finance climate action
Another aspect of this debate is how these climate funds should be structured. There are countries on which bets are being made an onion shaped design In which layers of public financing are combined with other private financing. There are people who bet more an avocado model In which a solid heart of public financing is designed and surrounded by private contributions that can be molded a little more. all options are on the table But, as experts warn, we need to look at the nitty-gritty of agreements to avoid bigger evils. For example, because there are people who fear that a large part of the wealth in the Global South will be given in the form of credit and, thus, it will end up Debt in these areas is increasing further Already poor. Baku has less than a week to whip this major salad into shape to save the world.
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