Last-minute negotiations on the NCQG. Photo: IISD_ENB
The ‘finance’ COP, held in Baku over the past two weeks, has finally drawn to a close – albeit 33 hours (or is it decades?) too late. Tasked with addressing one of the most pressing questions for climate action – how to finance global mitigation and adaptation efforts – the 29th edition of the UN Climate Change Conference, COP29, concluded with an agreement that marks progress, but which fell short of what many were calling for, leaving us with mixed reactions to the ultimate COP outcome.
Zooming into nature-specific outcomes at COP, there is little to report, but this was never billed as a big COP for nature. All eyes are on Brazil in that regard. That’s not to say that the past two weeks were all bad news for nature
Here are some key takeaways from COP29 and what it means for nature and climate action:
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Related articles for further reading
The new finance deal
Under the framework established by the UN in 1992, 23 developed countries and the European Union, historically responsible for the majority of emissions, are obligated to contribute to climate finance. However, agreeing on the amount and establishing a fair framework for payments has proven far more complex. In this context, the COP29 climate summit in Baku marks a significant breakthrough: for the first time in 15 years, the UNFCCC Parties have set a long-term financial target to mobilise $1.3 trillion annually by 2035 across, – which would include funding from all public and private sources. A target of $300 billion annually has been established to “prime the pump” to support vulnerable nations in building resilience, expanding energy access, and fostering sustainable development – though no specific mentions of sectorial action can be found in the final text, nor are there any specific references to nature. Developed nations are expected to lead these efforts, with developing countries encouraged to contribute voluntarily.
The $300 billion target, described as a “floor, not a ceiling,” serves as a foundation for further financial commitments. The plan aims to redirect global financial systems toward climate action, ensuring investments prioritise the needs of vulnerable nations. Billions in direct financial support are projected to flow to developing countries by 2035, fostering resilience, expanding energy access, and enabling sustainable development. To guide these efforts, the “Baku to Belém Roadmap to 1.3T,” led by the COP Presidencies, will coordinate and drive progress toward this goal.
Despite the progress, the agreement comes with significant compromises. Crucially, the funds will be mobilized from a mix of public and private sources rather than guaranteed grants. Delegates from the poorest nations criticized wealthier countries for their slow and insufficient response, with some labelling the deal as “too little, too late.“
Speaking of unrushed decision-making…
Global UN Carbon Markets – A Decade in the Making
Another major breakthrough at COP29 was the finalization of rules for global carbon markets under Article 6 of the Paris Agreement. After nearly a decade of negotiations, countries agreed on two mechanisms:
- Article 6.2: Regulates bilateral carbon trading between countries.
- Article 6.4: Establishes a global crediting mechanism for emissions reductions.
These markets could unlock significant funding for climate action while enabling countries to meet their emissions targets more efficiently, and so this has rightly been described by many as a major milestone.
Although the work is far from over. For Article 6.4, there is still critical attention required to the standards to ensure they don’t sideline natural climate solutions and Indigenous Peoples, including very impractical language around removals. For Article 6.2, it was agreed that the UN will not oversee the quality of environmental outcomes, nor will errors or inconsistencies receive any sort of penalty. While the agreement includes provisions for transparency to help ensure environmental integrity, there is still a risk that low-integrity deals can be struck, so civil society and media scrutiny will be more important than ever.
Enter…
The G20
Across the globe, leaders from the 20 largest economies of the world issued a Leaders Declaration reaffirming the goals of the Paris Agreement, reiterating the outcome of the Global Stocktake in Dubai, referencing the G20’s Principles for the Bioeconomy and support for the Tropical Forest Forever Facility. Data launched by Nature4Climate reveals that G20 countries could reduce greenhouse gas emissions by 3370 million tonnes of carbon dioxide equivalent per year (MtCO2e) – comparable to India’s total emissions in 2023 – by prioritising nature in their climate strategy plans.
On the topic of strategy…
National Contributions to the Rescue?
However, current pledges still chart a path toward 2.7°C of warming—far beyond the 1.5°C goal outlined in the Paris Agreement. Nature-based solutions (NbS), which can provide a third of cost-effective mitigation, remain underutilized. Forests dominate existing NbS plans (92%), while ecosystems like mangroves (46%), wetlands (45%), and peatlands (just 4%) are largely overlooked.
To guide countries in developing comprehensive and investable NDCs, Nature4Climate launched a detailed framework during COP29. Expanding the scope of NbS in NDCs will be critical to closing the ambition gap (read here).
Speaking of nature…
Not even crickets made it into the negotiation rooms – or so it seemed. Nature is a critical, yet vastly underfunded, climate solution. At the finance COP though, nature was sadly overlooked. During the tense NCQG talks, more than 100 organizations urged Parties to include ambitious commitments to finance nature within the new climate goal text. However, in the final stages, all mentions of ecosystems, nature and biodiversity were removed.
The omission underscores a glaring $700 billion annual funding gap for nature finance. Scaling up investments in nature-based solutions, such as restoring degraded forests or protecting wetlands, could generate up to 20 million jobs by 2030 while safeguarding the natural systems that underpin economies. Yet only 33% of nature-related policies published since the Paris Agreement have allocated budgets.
To meet climate goals, financial flows to NbS must almost triple by 2030. COP30 offers a chance to correct this oversight, but action must start now.
Political momentum for forests
Forests, however, did have a minute or so under the spotlight. The Forest and Climate Leaders’ Partnership (FCLP) highlighted progress on six country packages and reported that, over the first three years of the Global Forest Finance Pledge, the 11 participating governments and the European Union have collectively contributed USD 10 billion towards the USD 12 billion initially committed for forest conservation and restoration activities. Meanwhile, US President Joe Biden took his first trip to the Amazon to launch the new Brazil Restoration and Bioeconomy Finance Coalition (BRB Finance Coalition) to accelerate the conservation and restoration of Brazil’s forests, with a targeted, aggregate investment of at least $10 billion by 2030 among all coalition members. (Read our Week 1 recap for further details)
Though these indeed pose positive signs, the crucial ecosystem was notably absent from the decision texts.
This should take us to…
The Road to Belém
As 2024 is confirmed to be the hottest year on record, the urgency for transformative action has never been greater. COP29 made progress but left critical issues unresolved. The failure to agree on outcomes from last year’s global stocktake, including a timeline for phasing out fossil fuels, has left the COP30 Presidency with (what feels like) too many checkboxes to tick off.
As COP29 concludes, Alice de Moraes Amorim Vogas, Head of COP30 Brazil, shares an inspiring vision for COP30 in Belém. Brazil aims to consolidate its leadership in the global climate agenda, showcasing its commitment to transitioning to a low-carbon, inclusive future.
Brazil’s President Lula has called for a “fair, fast, and funded” transition to sustainable energy systems and forest protection.
One good thing to look forward to (aside from the food) is the promise of the largest Indigenous delegation ever seen, as announced by Minister Sonia Guajajara.
“The Paris Agreement process is still alive, albeit barely. Hopefully, the ambition evident in fresh NDCs from Brazil and others, coupled with President Lula’s recent G20 Summit comments, will inject fresh vigour into UN climate talks at COP30 – but the international community would be wise to expect more bumps on the road between Baku and Belém.”
Clare Shakya, The Nature Conservancy