China says it is a developing country so it does not have to contribute to a major new fund to help poor countries cope with climate change. The United States does not agree.

This is at the center of a major dispute about to spill over into the UN. COP29 climate talks next week in Azerbaijan.

Or is it all just an elaborate “distraction”?

The driver of this coming storm is something called “climate finance.”

It has been further fueled by Donald Trump’s re-electiona climate denier who is expected to remove the world’s largest historical emitter of greenhouse gases from global efforts to address climate change.

Why do countries pay for foreign climate aid?

In 2009, 23 developed countries – including the UK, US, Japan and EU – agreed to pay $100bn (£75.5bn) a year until 2020 to developing nations to help them transition away from fossil fuels. and adapt to a tougher situation. warmer climate.

The new fund was a victory for the poorest countries, although the sum is just a drop in the ocean of the trillions they now need.

He acknowledged that high-income countries have done much more to cause climate change, with their larger economies and more polluting lifestyles. While the poorest nations disproportionately hit by impactslike him floods that inundated Pakistan in 2022, or The drought that has devoured Malawi’s crops.

Meanwhile, they are under pressure to give up their own fossil fuel-powered development and go straight to clean energy, which is much harder for them to finance.

“The stakes could not be higher,” said Malawi negotiator Evans Njewa, representing a group of 47 least developed countries.

“We cannot continue paying the price for a crisis that we did not cause.”

But 2020 came and went, and donors fell short of the $100 billion a year goal, finally reaching it in 2022.

That fund expires after 2025, and plans to create a new, larger one will be discussed for two weeks in Baku, Azerbaijan’s capital.

The United States, the United Kingdom, the EU and other leaders had planned to push for five to 10 richer developing economies to start contributing to the piggy bank.

But developing countries suspect foul play.

The list of countries that simply will not die

When the first fund was agreed, the list of donor countries was based on an old Organization for Economic Cooperation and Development (OECD) list from 1992.

Back then, countries like China, Saudi Arabia, Qatar, the United Arab Emirates and Korea were considered developing countries.

And many things have changed since then.

China, for example, is now the world’s biggest polluter, second-largest economy, and has been to the moon.

The ‘distraction’

But here’s the thing.

China already voluntarily pays an average of $4.5 billion in climate finance a year, according to an analysis by the World Resources Institute (WRI), although not on very friendly terms.

Korea also pays voluntarily. So does Saudi Arabia. The list goes on.

And China’s emissions per person average 8 tons per year, but the average American’s are almost double that, at 14.9 tons.

That’s partly why the U.S. is accused of not paying its “fair share” of climate finance, a measure devised by think tanks like the U.S.-based WRI to evaluate What proportion of climate finance should developed countries pay, depending on their wealth and their responsibility for climate change.

In 2023, the United States paid $9.5 billion; It was much less during President Trump’s last term.

A spokesperson for the Chinese embassy in the UK said: “Providing financial support to developing countries is an unavoidable moral responsibility of developed countries and, more importantly, an obligation they must fulfill under international law, including the UNFCCC ( United Nations Framework Convention on Climate Change).) and the Paris Agreement.”

They added: “Developed countries promised to provide $100 billion a year for climate action in developing countries in 2009, but for too long they have paid lip service, and now owe developing countries more than $300. billion dollars in total.” Sky News could not independently verify the $300 billion figure.

Li Shuo, director of the China Climate Center at the Asian Society Policy Institute in Washington DC, said: “The Chinese authority sees this talk about the ‘new taxpayer’ as a distraction, as a way for the United States to shield itself behind its climate finance deficit.”

Other vulnerable nations also fear that rich countries are trying to “dilute” their contributions, and that more wallets do not equal more money in the fund.

The ‘fight’ between the United States and China

In no uncertain terms, the United States rejected any concept of a “fair share.”

A senior US official, speaking before the election, said: “The $100 billion is a collective goal. It does not specify any particular allocation… it does not include any concept of ‘fair share.'”

Shuo said the political context is very different from when previous funds were agreed upon. “We are dealing with a geopolitical fight between the two largest economies and emitters in the world, the United States and China.

Bilateral tension creates “a desire on each side to point fingers,” he said.

What impact will the US elections have?

“There is also very strong reason to believe that this US climate finance deficit will persist,” Shuo said.

Trump, who calls climate change a “scam,” is expected to pull the United States out of the historic Paris Agreement again, preventing much of American money from flowing abroad but also diminishing its influence.

Read more:
2024 is on track to be the first year to exceed the 1.5°C warming threshold
The deadliest weather events were driven by climate change

The talks in Baku will continue anyway, and the US team will continue to follow Biden’s lead, but their case will be met with skepticism and distrust.

“Driving more ambitious climate finance is going to be nearly impossible without US involvement, which will discourage developing countries from taking the West’s climate ambitions seriously,” said Elisabetta Cornago, a
Senior researcher at the Center for European Reform.

EU leaders will have to work even harder to convince new countries like China and some Gulf states to put up money, but if they succeed they would find it a little easier to sell the new fund at home, where finances are tight and some countries have become better.

How big is it?

According to various analyses, developing countries will soon need at least $1.3 billion a year to address climate change.

But given domestic politics and the likely absence of the United States soon, targeting that region is unlikely.

That’s why donor countries want the next fund – known in UN jargon as the New Collective Quantified Goal (NCQG) on climate finance – to be multi-layered.

First, a replacement for the previous $100 billion, in which more countries would pay with public money.

This would be followed by one or two more tiers, including private sector cash and other levers that governments could use to channel more money, such as risk-reducing loans or taxes on polluting industries such as fossil fuels, shipping and aviation. .

But Michai Robertson, chief financial negotiator for a bloc of 39 island states including Fiji and Antigua and Barbuda (AOSIS), said it would be almost impossible to guarantee the flow of additional revenue.

“It’s just crazy,” he said.

Countries are required under the Paris Agreement to agree to a new fund, and at least everyone agrees it should be larger.

But with deep divisions on almost every aspect – from donors to timelines to the actual sums involved – negotiators in Baku have a mountain to climb.