COP29: Trump, China, Climate Finance, and Illusions

COP29 opens in Baku, Azerbaijan, as 2024 will likely be the year the world officially crosses the 1.5°C warming threshold compared to pre-industrial times, one of the two critical limits set by the Paris Agreement.

This UN climate conference opens amid an increasingly fragile context for multilateral action. The re-election of Donald Trump, who promises to withdraw once again from the Paris Agreement-and this time, with a Republican Senate that could allow a full withdrawal from the UN Framework Convention on Climate Change (UNFCCC)-poses a significant threat. He could not achieve this goal during his first term, which allowed multilateral negotiations to continue without the USA, with the hope that they would rejoin four years later. This was indeed the case with Joe Biden's election in 2020.

Following the United Arab Emirates, this is the second COP organized in a major fossil fuel-producing country in a row. The host country, an important gas producer and key supplier for Europe, draws 60% of its government revenue from fossil fuels. Like the UAE presidency at COP28, Azerbaijan's presidency at COP29 is already accused of using the event to promote its fossil gas as a lower-carbon alternative to oil or coal.

The Agenda of COP29

The goals of this COP are relatively modest, designed as a transition conference before COP30 in Brazil in late 2025, where countries will have to renew their emissions reduction commitments in their Nationally Determined Contributions (NDCs). Consequently, the Baku COP is being boycotted by most world leaders, including Emmanuel Macron, Ursula von der Leyen, Xi Jinping, Narendra Modi, and Joe Biden. Only Keir Starmer, the new British Prime Minister, and Giorgia Meloni, the current G7 president, will participate among major world leaders.

The main objective of this summit is to establish new climate finance ambitions, particularly to support developing countries. This urgent need is demanded not only by the least developed countries but also by major emerging economies like India, which call for historical polluters to take responsibility. Delegates hope to make this summit a "Finance COP," prioritizing the adoption of a new collective quantified financial goal (NCQG) to replace the annual $100 billion commitment set in 2009 and achieved for the first time in 2022.

This new goal is crucial to enable vulnerable nations to finance low-carbon solutions and strengthen their resilience to climate impacts. This need is estimated at several trillion dollars-a staggering figure that public finance alone obviously cannot fulfill. The main challenge, therefore, is to create conditions that incentivize private finance to invest in climate action. This is an extremely complex task, given that fossil fuels are still highly favored by major global economic players-especially after a U.S. election marked by a platform promising to 'drill, baby, drill' and extract as much oil and gas as possible. This context clearly does not encourage the redirection of financial flows toward low-carbon energy sources…

COP29 will thus attempt, following the promises made in Dubai, to promote reforms to mobilize more private and innovative financing, particularly through multilateral development banks. The goal is to ensure a fair transition to a low-carbon economy for all, with strengthened transparency mechanisms to ensure that financial flows genuinely meet the needs of the most vulnerable countries.

Discussions will also address climate adaptation and carbon markets, through Article 6 of the Paris Agreement, aiming to ensure greater transparency in a field often seen as opaque.

Finally, in addition to financing, COP29 is also, in theory, an opportunity for states to strengthen their national climate commitments, in line with promises made at previous summits.

But are these goals realistic in the current context? Let’s be honest, the task will be challenging. Trump’s return to the White House in January 2025 could push Democrats to position themselves as the "climate party," but the Biden administration no longer has the political means to go beyond rhetoric.

Chinese illusions

Many climate activists and COP participants are therefore turning their eyes to China, naively hoping it will take on a leadership role alongside the Europeans. However, it would be mistaken to indulge in illusions about what role Beijing truly envisions to play, as illustrated in its just released Annual Report on Climate Action.

An undeniable leader in deploying clean technologies, of which it controls the majority of supply chains, China has an interest in promoting their adoption, but it does not intend to commit to a massive restriction of its emissions in the short term. No significant carbon price before at least 2030, no absolute emissions limit on key industries before that date either, and a clear focus on energy security through coal as long as it remains necessary for its economic growth.

Many have long predicted China’s emissions peak, but the exact timing remains uncertain, and their rapid decline will be the true indicator of China’s commitment to climate action. Beyond rhetoric, if the country will decline its emissions, nothing is certain in terms of timing in a context of slowing Chinese growth and a reliance on coal as a long-term guarantee. Moreover, growing trade tensions surrounding Chinese clean technology exports (batteries, solar panels, electric vehicles) exacerbate the reluctance of many countries, including those in the Global South that China claims to lead.

In short, China is willing to engage on climate issues as long as it benefits commercially. However, it faces growing backlash against its mercantilist approach from many countries worldwide, which see it as a risk to their economic standing amid an already challenging energy transition.

Between China and the United States

Will Trump’s United States and Xi’s China be so different in terms of climate? Rhetorically, yes. Trump would likely reform the Inflation Reduction Act-the primary decarbonization policy in the U.S.-rather than completely overturn it, given its popularity among many economic players, especially in Republican states.

The deployment of clean technologies would likely continue, driven by existing contracts, state initiatives, and private entrepreneurship. Under Trump, however, this development would coincide with a return to free-riding in fossil fuel exploitation, increasing global emissions and sending a disastrous signal about the lack of divestment from fossil fuels.

However, this strategy, which combines clean technologies with fossil fuels, is not very different from China’s strategy, which consists of massively deploying clean technologies while maintaining coal. Thus, the two giants diverge significantly from Europe, a pioneer in reducing its emissions, with a goal of a 90% reduction by 2040 and a high carbon price covering most economic sectors. Neither Trump nor Xi Jinping presents comparable ambitions.

On the climate finance front, the outlook from Washington is bleak relative to its historical responsibility. The same is true of Beijing’s position. China maintains that it is a developing country and therefore refuses to be subject to the same obligations as "rich" countries under the new financing framework to be negotiated in Baku, which exempts it from mandatory financing or even moral responsibility. Nevertheless, at the current pace, China will become the second-largest historical emitter within three years, only after the US, and surpassing all Europe. It falls back on voluntary "South-South" financing, mainly through its contribution to multilateral banks such as the Asian Infrastructure Investment Bank, which amounted to $4 billion in 2022 - three times less than France. This Chinese posture is untenable for Europe, Japan, and Canada, which consider Beijing an essential financer.

Clean Technologies race at the heart of Climate Action

Would the survival of this process-or rather, the survival of its credibility- still allow for potential collective progress in emissions reduction? This will depend on whether clean technologies can offer sufficient energy security and growth to countries adopting them rapidly.

It is therefore our responsibility, as Europeans, to demonstrate that prosperity and success in decarbonization can go hand in hand. This responsibility falls particularly on Europe, especially after Donald Trump's re-election. Without this commitment, multilateral action-already failing to limit warming to 1.5°C-risks also failing to keep us below the 2°C threshold, with disastrous consequences for our populations and our planet.

Copyright image : Alexander NEMENOV / AFP
COP28 President Sultan Ahmed Al Jaber and COP29 President Mukhtar Babayev at the opening ceremony of COP29 Baku, November 11, 2024.