By Faridat Salifu
As world leaders prepare for COP29 in Baku next month, a new report highlights a pressing need for dramatic increases in climate finance to avert the worst impacts of global warming.
The Global Landscape of Climate Finance 2024 report, published today by Climate Policy Initiative (CPI), reveals that climate finance flows have doubled to nearly USD 1.5 trillion between 2018 and 2022.
However, the report warns this is far from sufficient, with annual climate finance needing to increase at least fivefold by 2030 to stay on track with the Paris Agreement.
Currently, climate finance amounts to just 1% of global GDP, while emerging markets and developing economies may require as much as 6.5% of GDP by 2030 to meet climate goals.
Barbara Buchner, CPI’s Global Managing Director, stressed the urgency, saying, “Investment needs to scale across all fronts domestically, internationally, and across sectors to reach our mutual climate goals. COP29 offers a chance to set clear, collaborative commitments to achieve a sustainable future.”
The report further underscores the cost of inaction, warning that economic losses by 2100 could be five times higher than the amount of climate finance needed by 2050 to keep global temperature rise within 1.5°C.
The consequences of delayed climate action are expected to exacerbate financial strain worldwide, with fossil fuel investments still surging, surpassing USD 1 trillion in 2023 and 2024 despite commitments to reduce them. Subsidies for fossil fuel consumption in emerging economies also increased fivefold over the same period.
As COP29 approaches, the CPI report advocates a cohesive approach to climate finance, identifying critical areas for scaling up investment: innovation and replication, targeted allocation, domestic policy reform, and cross-sector collaboration.
With the establishment of the New Collective Quantified Goal (NCQG) at stake, this year’s summit is viewed as a pivotal moment to align global finance flows with a low-emission, climate-resilient future.