Baku or Bust

The famous poem “An die Nachgeborenen” (To those who follow in our wake) by Bertolt Brecht includes the verse: 

What times are these, in which A conversation about trees is almost a crime For in doing so we maintain our silence about so much wrongdoing! 

Today, when we wish to deflect conversation to an innocuous subject, trees – or nature in general – are no longer the go-to topic. One look out of the window may be enough to glimpse the impacts of climate change: record floods, hurricanes of unprecedented ferocity, catastrophic droughts and wildfires brought on by heatwaves – the disasters are coming thick and fast and ever more dramatic. 

Trees, by the way, play a key role in this: Deforestation contributes 12–20 percent of global greenhouse gas emissions, according to a study by the London School of Economics. As a result of deforestation and degradation, some tropical forests now emit more carbon than they capture, turning them from carbon sinks into carbon sources. 

This is one challenge the representatives of almost 200 nations, thousands of organizations large and small as well as tens of thousands of other delegates are facing at this year’s UN Climate Change Conference – universally referred to as COP29, in November 2024 in Baku, Azerbaijan. 

Two years ago, COP27 saw a historic agreement on the creation of a loss and damage fund to compensate climate-vulnerable countries. Last year’s COP28, for the first time, called on all countries to “transition away” from fossil fuels. This year’s summit is not expected to deliver breakthroughs, but rather to pave the way for upcoming decisions. UN climate chief Simon Stiell has dubbed the conference an “enabling COP.” 

The big question, as so often, is money. For the first time in 15 years, countries will have to agree on a new global finance goal, the so-called New Collective Quantified Goal, updating the US$100 billion target of annual spending set in 2009 and finally met in 2022. While it is widely understood that the US$100 billion “floor” is insufficient, estimates of how much is needed vary widely and range from US$500 billion to US$2.5 trillion, according to the Organisation for Economic Co-operation and Development. 

These are staggering amounts. But what is also clear – and now largely undisputed – is that inaction is the most expensive option of all: A new study by the International Institute for Applied Systems Analysis finds that if global warming reaches 3°C, global GDP will fall by as much as 10 percent. That equals more than US$10 trillion, based on last year’s global economic output. 

Against this backdrop the Baku summit has already been called the “finance COP.” Discussions will not only focus on the new cumulative target, but also who the donor base and recipients will be, how much will come from public and private sources and whether it will be in the form of grants or loans. Negotiations in the run-up to COP29 saw no convergence of positions. Azerbaijan, as holder of the conference presidency, will have to pull all available diplomatic strings to secure an agreement. 

Another key topic in Baku will be the looming deadline for countries to submit their new Nationally Determined Contributions, outlining how they will curb emissions. These must be renewed every five years, with the next round due in February 2025. COP29 will be a crucial moment for countries to raise the bar and hold each other to account. “The speed of the leader determines the pace of the pack,” the US philosopher Ralph Waldo Emerson once noted. As in previous years, the OPEC Fund will demonstrate its commitment to climate action with a strong presence at the event. COP29 will also be the perfect stage to launch two new reports, one on climate finance and the other on clean cooking. The OPEC Fund is resolutely pursuing its Climate Action Plan with the target to commit 40 percent of all new financing to climate-related investments by 2030. To date, delivery is ahead of schedule and target. 

With this issue of the OPEC Fund Quarterly we aim to provide an overview of the challenges we are facing, but also to highlight the manifold responses to the global threat of climate change. Real change, as always, begins with education: We recommend our review of the boardgame Daybreak, where participants have two hours to save the planet. COP29, in contrast, is set to run for 11 days. 

We wish you an interesting read.