Sébastien POSTIC, Phd

The COP29 in Baku was supposed to breathe new life into North-South climate cooperation through the negotiation of the new NCQG financing target. Instead, confrontational negotiations produced a half-hearted agreement, and the onerous task of charting a path to bridge the resource gap before the next COP.

The urgency of climate action is becoming ever more apparent, yet we remain far from securing the level of financing required for meaningful progress. The first Global Stocktake underscored a widening gap between the needs of developing countries and the support they receive, while advanced economies also struggle to finance their own ambitious climate targets.

Attention is growing to the need to tackle climate and social issues jointly. Indeed, both climate change and climate policies affect social issues such as poverty, inequality, or access to healthcare. A well-known example is that of carbon pricing, a climate policy which can have regressive effects in some contexts. As another example, climate change induced heatwaves are disproportionately likely to impact poorer individuals who typically have more constrained access to healthcare, physical jobs in outdoor conditions, and through indirectly driving up food prices. To foster an effective and sustainable transition to low-carbon and resilient economies, policymakers need to ensure individuals do not lose more from climate policies than they already lose from the effects of climate change, but instead benefit from them.

France should publish mid-year its first multi-annual strategy for financing the ecological transition. This is a long way from the first 2015 climate strategy, which barely touched funding aspects. And it is good news. We at I4CE believe that such plans are essential tools to support the transition to low-emission, climate-resilient economies. Credible, multi-year public spending targets help to embark the private sector and the funders of public action (debt holders, international donors) in the transition, and redirect financial flows as demanded by the Paris Agreement. Comprehensive financing plans also avoid simplistic approaches based on case-by-case project appraisal on the basis of limited cost-benefit considerations, which can ultimately result in significant additional costs.