Skip to content

US Opposition To Climate Finance Stalls UN Climate Talks

Nitin Sethi, Business Standard

Discussions on road map for climate finance stalled by developed countries

Negotiations on the Paris climate change agreement’s second draft slipped behind closed doors on Wednesday in Bonn, Germany. News filtered out from the parallel meetings that the text of the agreement had begun to balloon again, with all the countries inserting more text in the ‘spin-off’ meetings.

In the discussions on finance that were held in one spin-off meeting, the key issue of a roadmap for ratcheting up delivery of funds by developed countries remained stuck, as the European Union suggested the matter should be taken up by the ministers and was too difficult to be dealt with at the level of negotiators. It suggested that the negotiators should deal only with lesser substantial questions, such as institutional mechanisms for climate finance. Before that, the US reiterated their long-standing position that public funds were expected to be a small portion of the $100 billion that the developed world is required to provide annually starting 2020.

The US also asked that the economic reality at present should be taken into consideration, while asking countries to contribute to the climate funds. This implied that emerging economies should also contribute to the climate funds, which under the United Nations Framework Convention on Climate Change (UNFCCC) only developed countries are obliged to provide so far.

This was opposed by negotiators from developing countries who pointed out that the new reality was that Organisation for Economic Co-operation and Development (OECD) countries continued to hold most of the wealth, and that developing countries were having to deal with adverse effects of climate change.

Several negotiators Business Standard spoke to in the developing world teams confirmed that the spin-off groups were not being productive with all sides bringing back proposals, ideas and insertions that had been crunched down when the co-chairs presented the first draft of the Paris agreement before this round of meeting in Bonn. “At the moment, the text is expanding in all spin-off groups. Developed countries are bringing back ideas that they know are absolutely unacceptable. It’s almost as if they are reacting to the fact that G77+China was able to put back on table their agenda which the co-chairs had wiped clean in the first draft (of the Paris agreement),” said a head of delegation from the G77+China group not willing to be named.

Outside the spin-off groups, India criticised a report from the OECD, which claimed that more than $60 billion funds had been committed well ahead of the 2020 deadline for the $100 billion. Indian negotiators questioned how loans and existing overseas development assistance could be defined as “new and additional funds”. Earlier decisions of the UNFCCC have required that the developed countries provide new and additional funds and not green-wash existing donations or loans and market investments as part of the climate funds.

The US and many developed countries see the deepening low-carbon technology markets due to the new pledges by developing countries as a market opportunity and have pushed that the southern world create a better investment climate to receive these private investments as part of its commitments under the Paris agreement. The US special envoy, Todd Stern, on Tuesday, had told the US senate: “No one is in a better position than the US to win big in the multi trillion dollar 21st century market for low carbon energy innovation.”

An Indian negotiator said as part of this push the US has also asked for long-term low-carbon plans from all countries to provide certainty and signal to their industry. Stern had spoken of this in his testimony before the senate as advocating a white paper from all countries on deeper cuts by 2050 and long-term decarbonisation plans by the end of the century. At the same time, he had said the US would not agree to binding emission reduction targets under the Paris agreement.

Full story