The world is walking a precarious path. We have not seen this level of conflict since WWII. We have never seen this level of climate impact: hurting people, impinging on our economies, and pushing our natural systems to the point of no return. Meanwhile, inflation is costing families dearly, harming business, increasing the cost of capital, and causing politicians to reach for protectionism.
This paints a challenging political picture for the COP28 UN climate conference starting on 30th November. But it can be a moment for the world to come together to chart a hopeful path out of this situation. A path fuelled by the opportunities of climate action that signals shared responsibility, and solidarity in the face of adversity.
The latest climate science published earlier this year showed that the window is rapidly closing for policy and investment decisions to limit warming to 1.5C. The deadline for governments to set out their next phase of climate policy goals in 2025 is looming. Average annual investment requirements this decade are a factor of 3-6 times greater than current levels. Finance especially lags for adaptation – where there are growing gaps in action, that to date, has been fragmented, incremental and unequal across regions. COP28 needs to send strong signals to markets immediately and guide the actions governments need to take over the next two years.
The central negotiating task at COP28 will be the response to the first Global Stocktake (GST). It is a major political opportunity to give a new vision and direction to societies and economies worldwide. It is also a critical piece of the Paris Agreement governance architecture: the crux to making the ‘bottom-up’ process of governments all deciding their own nationally determined contributions (NDCs) to solving the climate problem work. COP28 is the first time governments will agree on how to respond to a stocktake that has revealed just how far off track we are from our collective climate goals, so an ambitious, effective response is vital to upholding the climate pillar of multilateralism.
Other critical negotiations at COP28 will include agreements on operationalising a fund for managing loss and damage from climate impacts, setting a framework for governing adaptation efforts, landing the first decisions under the mitigation work programme, establishing a work programme on just transition, and setting up a strong foundation to agree the successor to the $100bn goal next year. Beyond the negotiations, COP28 is a political stage for governments and businesses to make announcements on new policy directions and new funding commitments.
What do we need to see from COP28?
This means agreeing a package of global goals and delivery mechanisms for accelerating the energy transition. This consists of a collective goal to hasten the just and managed phase-out of all fossil fuels, including an immediate end to new coal power plants, with limitations rather than a get-out-of-jail free pass for abatement, as well as goals to triple global renewable capacity and double the rate of energy efficiency improvement by 2030, and critically, to scale finance for developing countries’ transitions.
It also means agreeing guidance to countries on setting their next NDCs and Long-Term Strategies – to reflect economy-wide targets covering all sectors and all gases from 2030 onwards, well ahead of COP30, and to reflect collective mitigation agreements in domestic policy.
To build confidence in a shift in policy direction, new commitments by countries can show how they are stepping up action and galvanising momentum behind sectoral transformations. Updates from cooperative initiatives like the Powering Past Coal Alliance or the Beyond Oil and Gas Alliance could evidence the accelerating pace of real-economy action. New pledges on nature and food systems can demonstrate a climate regime that is maturing towards addressing critical interlinkages and synergies between issues.
Businesses have a part to play too – but only if they meet high standards for ambition and embrace real measures to be accountable to their pledges. The role of the fossil fuel industry is under the spotlight this year. The UAE Presidency wants to bring them to the table. However, the rumoured Oil and Gas Decarbonisation Accelerator risks falling short of credible benchmarks for what a meaningful contribution to climate action from IOCs and NOCs looks like.
Developing countries will be looking to make the loss and damage fund a reality by agreeing its set-up and bringing new money at scale to fill it. Climate vulnerable countries want to see more political attention on access to adaptation finance and a new agreed framework for the Global Goal on Adaptation – this would ensure more action on the ground and more money going to where it’s needed.
According to developed countries, the $100bn climate finance promise has been met this year; though without verified numbers, new finance pledges from developed countries will be key to building confidence that this political hurdle can be jumped over. Regardless, far greater scales of finance are necessary to resource climate action and development properly.
Since Barbadian Prime Minister Mia Mottley and Assistant Secretary-General Selwin Hart blasted reforming the financial architecture onto the COP26 stage in Glasgow in 2021, there has been strong political support for transforming the financial system, especially from the Global South. COP28 needs to mobilise the strong political will behind reforming the financial system onto a practical pathway for delivering reforms and new capital.
There has been progress already in 2023 – including the World Bank’s evolution roadmap and embrace of reforming its policies to better leverage its existing balance sheet, and movement on rechannelling the IMF reserve currency allocated during COVID-19 to support climate resilient development projects in Africa through the African Development Bank. The COP28 World Climate Action Summit on 1st and 2nd December will need to see world leaders concretise the global financial architecture reform agenda and set the expectation for negotiators to agree calls for transformation in the Global Stocktake response.
Sealing the deal in Dubai
Getting this package over the line in the coming weeks will require a delicate sequencing of diplomatic efforts. Our separate blog outlines the path that negotiators must weave through in Dubai.
