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How does the new collective quantified goal on climate finance reshape the climate–development finance nexus?

Aleksandrova, Mariya / Svea Koch
Staff - Other (2025)

in: Stephan Klingebiel / Jorge A. Pérez-Pineda / Kathrin Berensmann, Financing for development: From Monterrey to Seville, Bonn: German Institute of Development and Sustainability (IDOS), 33-36

This paper explores the implications and lessons from the process and final decision of reaching a new collective quantified goal (NCQG) under the United Nations Framework Convention on Climate Change (UNFCCC) for the interlinkages of development and climate finance to be discussed at the Fourth International Conference on Financing for Development (FfD4). The NCQG decision adopted at the 29th Conference of the Parties (COP29) in Baku reflects deep divisions between developed and developing countries and weakened commitments under the Paris Agreement, charting a challenging path forward for development cooperation on climate issues. The question now is whether the NCQG decision has already settled the discussions about additionality of development and climate finance (by removing it from the NCQG text), or whether it  will be reopened in Seville at FfD4, given the disappointment and frustration of developing countries with the decision. Overall, the new climate finance goal maintains the status quo by allowing contributors to direct funding through channels that best serve their interests, blurring the lines  between climate and development finance, while also shifting control beyond traditional donors. In addition, the vagueness of the NCQG decision text on balanced geographic and sectoral (mitigation and adaptation) allocation falls short of establishing concrete targets for a minimum  allocation floor for the most vulnerable countries. The tough and geopolitically heated negotiations in Baku on scaling-up finance and improving quality are expected to be a precursor to what we can anticipate at FfD4.

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