Broken Financial Promises Threaten Developing Nations’ Climate Efforts

*AUTHOR BIO

Climate financing supports developing nations threatened by climate change. ©LightFieldStudios/envato
Climate financing supports developing nations threatened by climate change. ©LightFieldStudios/envato

When it comes to climate change, the consequences felt in one country are felt in all others. While each country around the globe contributes to climate change in some way or another, some are more responsible than others. For example, an estimated 70% of global emissions come from just China, the United States, the European Union, India, the Russian Federation, and Japan.


Developing countries, such as those in the Global South, are not well-equipped to manage their own emissions and are given the short end of the stick when it comes to financial or technological support to decrease their emissions without compromising their national development. While their emissions per capita can be high, their total emissions remain starkly lower than those of the developed countries.


The unequal playing field between developed and developing countries is a danger to environmental efforts and affects everyone, no matter their country of origin. Transnational climate financing is a joint effort between developed and developing countries to provide financial and technological support to combat climate change, which may ignite hope to overcome the current inequality. However, to be successful, promises between countries must be kept.


Bright Spots in Eco-Financing for Developing Nations


For example, the Green Climate Fund (GCF) works in collaboration with 194 countries with a current goal to mitigate 2 billion tons of carbon emissions in developing countries. GCF prioritizes countries such as small island developing states (SIDS), African states, and the least developed countries (LDC). As of 2021, Costa Rica is collaborating with the GCF to build a low emission metropolitan light rail system powered by 98% renewable energy.


NGOs such as CARE recognize that nearly 132 million people will be thrust into poverty by 2030 if action to mitigate is not taken. CARE works with poverty-stricken rural communities and households throughout the Global South through their Seed System initiative to improve sustainable agricultural practices. Local farmers are able to access services to increase and diversify crop yields and to adapt to climate change


Additionally, the sustainable development goals (SDGs), adopted by the UN in 2015, recognize the inextricable link between climate change and the need for sustainable development. Goal 13 in particular is an urgent call to combat climate change. The SDGs have inspired some countries to consider transnational climate financing strategies. For example, The UK and China established joint Green Investment Principles (GIP) to keep financial institutions accountable for their effects on the environment. The GIP outlines how the two countries’ joint ventures can commit to “embedding sustainability into corporate governance” through regular environmental impact assessments, incorporating “ESG” (environmental, social, and governance) metrics throughout their supply chains, and green financing.


While SDGs are ideal landmarks for every nation, not every nation can reach them with the same expediency. Robust partnerships between developed and developing nations are key for poorer countries to not be left behind in terms of global climate action. The opposite is also true. When promises to transnational climate financing are broken, they can cause harm to all.


Climate Financing’s Broken Promises


In 2009 at COP15 in Copenhagen the wealthiest countries in the world promised developing nations to provide $100 billion for climate change support per year by 2020. While all parties were eager to see this promise fulfilled, by the time COP26 convened in Glasgow, experts found that the promise had fallen short. The intergovernmental Organization for Economic Co-operation and Development (OECD) estimated that developed nations had provided $78 billion in 2018 and $80 billion in 2019 with no sign of substantial improvement since then. Falling behind on climate financing promises makes it that much harder for the globe to collectively overcome climate change in the present and into the future.


So, how did the $100 billion broken promise happen?

The $100 billion promise would only make a small dent towards reaching the 2015 Paris Agreement target to keep global warming below 2 degrees Celsius above pre-industrial levels. Realistically, experts say that it would cost trillions of dollars to meet the Paris target.

Some argue that, when the agreement for $100 billion was made, developed nations did not clarify who would pay how much and how. The ambiguity led to some countries believing others would pay more. It was estimated, for example, that the United States should pay roughly 40 – 47% of the $100 billion annually, based on considerations around national wealth, past emissions, and population size. However, from 2016 to 2018, the US only contributed around $7.6 billion annually.


Even then, the $100 billion promise would only make a small dent towards reaching the 2015 Paris Agreement target to keep global warming below 2 degrees Celsius above pre-industrial levels. Realistically, experts say that it would cost trillions of dollars in order to meet the Paris Agreement target. Researchers from Scotland’s Glasgow University have also found that climate financing initiatives were provided more to middle-income countries rather than the poorest. For example, only 18% of the fund from the aforementioned GCF reached the poorest countries in 2019, whereas 65% of the fund reached middle-income countries.


When promises are not kept, alternative solutions can offer hope.


Alternative Climate Solutions for Developing Countries

Silvopasture systems in Colombia improve sustainability of cow herds. ©Gabriel Porras/Unsplash
Silvopasture systems in Colombia improve sustainability of cattle herds. ©Gabriel Porras/Unsplash

As developing nations wait for funding, local governments have an opportunity to consider alternate approaches amidst the climate crisis. The options vary from renewable energy investments to agricultural innovations:


Cheap, renewable energy: Renewables, such as solar and wind, are now considered the world’s cheapest source of energy, according to the World Economic Forum. In 2020 alone, despite the pandemic, experts have found that more than 260GW of renewable energy capacity was added globally. The clean energy sector is now booming with jobs, and it has helped countries such as Zambia create their first large-scale solar powered plant, bringing clean energy to thousands of homes and businesses.


Transportation: Energy-efficient transportation, formerly quite expensive, has now become more affordable. The EV car market has grown by 20 million within the past ten years, although other options exist beyond electric cars. Bangladesh, on the forefront of climate change with rising sea levels and the melting of Himalayan glaciers which flood the country, has introduced cargo transport on inland waterways to reduce emissions by 4 to 10% by 2030.


Urban development: Cities, home to most of the planet’s population, can greatly benefit from targeted climate adaptation. Mozambique, for example, revised their stormwater drainage system which resulted in 70% less risk of flooding (a common climate change threat). Local leadership is key to enacting sustainable urban development, even without transnational climate financing.


Agriculture: Agricultural innovations can improve the sustainability of food grown, help protect local ecosystems, and even support carbon sequestration. Cattle ranchers in Colombia combine trees with pastures, called silvopastoral systems, to reduce the environmental impacts of their cattle herds and to promote natural regeneration within the region.


While alternative strategies are not limited to the ideas listed above, the amount of research and resources already committed to helping developing countries mitigate climate change is encouraging. As a global society, we operate in a sensitive ecosystem; when one nation hurts, we all hurt. Our promises to climate financing are not only a commitment to others but a promise to the planet and to each other.

 

*Chelsea Noack is a science writer and editor based in Manhattan. She is passionate about climate change, ocean science, bioethics, technology, and the future of human health.