Money pledges grabbed the spotlight at Cop28 in Dubai on Monday as delegates turned their focus to the yawning gap in the need for climate finance and what's on offer.
The United Arab Emirates – the host of this year's conference – pledged $270 billion in green finance by 2030 through its banks, and several development banks made fresh moves to scale up their funding efforts, including by agreeing to pause debt repayments when disaster strikes.
But leaders of the region's biggest economy and the world's biggest oil producer – Saudi Arabia – have so far not attended the UN summit, in sharp contrast to their participation in last year's Cop27 conference in the Egyptian resort of Sharm el-Sheikh.
Saudi Prince Abdulaziz bin Salman, energy minister and the key climate negotiator for the kingdom, was a no-show at the Saudi Green Initiative.
De facto ruler Crown Prince Mohammad bin Salman also did not deliver a keynote speech to world leaders as scheduled on Friday.
Our explainer on climate finance highlights the five areas in which it is most needed: transforming the energy system; adaptation and resilience; loss and damage; restoring and protecting natural capital; methane abatement #FinanceDay #COP28 https://t.co/tPdLuC0JLY pic.twitter.com/BfzhTVKXUZ
— Grantham LSE (@GRI_LSE) December 4, 2023
Trillions needed for developing nations
The amount of cash needed for energy transition, climate adaptation and disaster relief is overwhelming.
A report released Monday estimates that emerging markets and developing nations will need $2.4 trillion a year in investment to cap emissions and adapt to the challenges posed by climate change.
"The world is not on track to realise the goals of the Paris Agreement. The reason for this failure is a lack of investment, particularly in emerging market and developing countries outside China," said the report's co-author Nicholas Stern, who chairs the Grantham Research Institute on Climate Change and the Environment.
"The central challenge is to accelerate and implement the fostering and financing of this investment from a range of sources."
Billions more for 'disaster fund'
Meanwhile, vulnerable countries that are already being hit by costly climate disasters are asking for billions more through a newly formed disaster fund, although current pledges are only around $700 million.
"Unless we have an urgent set of decision-making, we are going to suffer what every parent suffers from – exciting expectations and being unable to deliver," said Barbados Prime Minister Mia Mottley, who has become a prominent voice in global discussions about mobilising climate finance.
It was a pleasure joining Alexia Latortue, Assistant Secretary of the US Treasury, James Scriven @JamesPScriven, CEO of IDB Invest @BIDInvest and Hong Paterson, CFO of GCF at the US Treasury’s event entitled, “Small Islands, Big Challenges” at #COP28 Dubai. pic.twitter.com/vmpXDkfA9X
— Mia Amor Mottley (@miaamormottley) December 4, 2023
In a news conference, she urged countries to go beyond voluntary pledges and pleas to charities and private investors and instead to consider taxes as a way to boost climate funding.
A global 0.1 percent tax on financial services, for example, could raise $420 billion, she said, while a 5 percent tax on global oil and gas profits in 2022 would have yielded around $200 billion.
"The planet needs global governance not in a big stick way, but in a simple way of us cooperating with each other to be able to work with the institutions that we have," she added.
Other delegates, including UN Secretary-General Antonio Guterres, have called for an end to fossil fuel subsidies which have hit a record $7 trillion per year.
