Bonn logjam: Developed countries sought mitigation, rejected finance

G-77 Chair told CarbonCopy “the immediate and total rejection” of the developing country proposal for climate finance re-emphasised the perception that developed countries want to engage them in mitigation discussions without contemplating means of implementation

Late evening on June 14, a day before the 58th session of the Subsidiary Bodies (SBs) UNFCCC Subsidiary in Bonn, Germany, drew to a close, countries reached an agreement on a particularly contentious topic on mitigation and finally adopted the agenda of the meeting. 

In a “spirit of compromise and flexibility”, as expressed by the SB Chairs, it was decided that a proposal by the European Union (EU) on the mitigation ambition and implementation work programme be dropped and instead, a Chairs’ note be included reflecting consultations held so far under the theme. In the 10 days before this, discussions continued even as the meeting had no formal agenda.

The last-minute agreement saved Bonn talks from the brink of collapse. Until then, countries expressed strongly divergent views on the agenda, a document that should have been agreed to at the very beginning. 

At Sharm el-Sheikh, parties agreed to have the first global dialogue on mitigation at Bonn, two global dialogues every year and an annual report based on which they would have discussions. They also chose the topic of just energy transition as a focal part of these discussions. And so, the EU proposal for a specific agenda on the mitigation work programme here in Bonn is “premature,” Diego Pacheco, head of the Bolivian delegation to the UNFCCC and spokesperson for the Like-Minded Developing Countries (LMDCs) told CarbonCopy. LMDCs comprise China, India, Bolivia, Saudi Arabia, Pakistan, etc.

“The EU proposal had no mandate from COP27,” said Cuban Ambassador Pedro Luis Pedroso, lead negotiator for the G-77 and China group, which consists of 134 countries, broadly viewed as the voice of the Global South. The proposal was also “out-of-context,” he added, because it did not envisage means of implementation i.e. finance and technology transfer.

In response to the EU proposal on mitigation, on June 7, LMDCs proposed a new agenda item to “urgently scaling up financial support from developed country Parties in line with Article 4.5 to enable implementation for developing countries in this critical decade.” Article 4.5 of the Paris Agreement states “Support shall be provided to developing country Parties for the implementation of this Article, in accordance with Articles 9, 10 and 11, recognising that enhanced support for developing country Parties will allow for higher ambition in their actions.”

“The agreement at Sharm el-Sheikh was based on many discussions, multilateral trust and a very delicate balance,” Pacheco noted, adding that the group does not reject mitigation itself. “It is very important for our countries to move forward with mitigation. But in the context of climate finance… if we are going to discuss mitigation, we need to talk about finance,” he said. 

This proposal was supported by the Arab Group (Egypt, Qatar, Bahrain, Saudi Arabia and COP28 host the UAE), the African Group (South Africa, Nigeria, Ethiopia, Democratic Republic of Congo, Mozambique etc), BASIC (Brazil, China, India and South Africa), the Bolivarian Alliance for the Peoples of our America (ALBA comprising Venezuela, Bolivia, Cuba, Nicaragua, etc) and ABU (Argentina, Brazil, Uruguay). 

But it was outrightly rejected by the EU, the US and a few other developed countries like Australia and Japan, who broadly argued that finance was included under the mitigation work programme. 

More specifically, the EU questioned why a new agenda item was proposed at this late stage and went so far as to call it “non-serious”. While the US said Article 4.5 does not specifically refer to support by developed countries. Pays to note, Article 4.5 explicitly cites Article 9, which states “Developed country Parties shall provide financial resources to assist developing country Parties with respect to both mitigation and adaptation in continuation of their existing obligations under the Convention.” So far, the US has provided the least amount of its fair share of climate finance (only 5%), according to an analysis by ODI, a London-based think tank.

“The immediate and total rejection of the LMDC proposal re-emphasised the perception that developed country parties want to engage us in mitigation discussions without contemplating means of implementation,” Pedroso said.

The Environmental Integrity Group (EIG comprising Switzerland, Mexico, Georgia etc) said they wouldn’t accept an agenda that doesn’t have mitigation. The Alliance of Small Island States (AOSIS comprising Bahamas, Maldives, Grenada, Fiji etc) and the Independent Alliance of Latin America and the Caribbean (AILAC comprising Chile, Colombia, Paraguay etc) spoke in support of the EU proposal for an agenda item on mitigation. 

In response to such rejection of its proposal, LMDC said they would not accept the agenda on mitigation work programme agenda if finance is not adopted alongside. Cuba, which currently holds the G-77 chair, supported this stance saying “finance is highly, highly important and long time overdue. The more we resist having the issue of finance on the agenda, the more suspicion there will be outside that there will not be any means of implementation for anything.” China also extended support to the LMDC proposal. 

One way to break the logjam was to include both proposals—on mitigation and finance. Afterall, finance makes mitigation possible in developing countries. In fact, even IPCC’s Working Group III Sixth Assessment report on climate mitigation emphasises the need for climate financing in poor and vulnerable countries with “high” and “very high” confidence in many instances. 

The LMDC believes there is a need for a separate and committed space to discuss how to finance Nationally Determined Contributions (NDCs) of developing countries. According to a 2021 report by the UNFCCC Standing Committee on Finance, developing countries need $5.8–5.9 trillion to finance less than half the climate actions listed therein. 

And while there are discussions on long-term finance and on a new quantified collective goal, “we need a dedicated agenda to discuss mitigation action in developing countries. This is the rationale behind the LMDC proposal. We have seen the failure to mobilise $100 billion,” Pacheco added.

But the EU wouldn’t budge. They rejected the LMDC proposal. And the compromise was to have an agenda with neither mitigation nor finance. 

“Some members of the G-77 would have liked to see more focussed discussions on mitigation but in conjunction with the scaling up of finance…there is a huge implementation gap in the climate agenda because of the lack of financial support,” Pedroso said. Overall, he added, there was “great willingness across the board” among G-77 countries to support the LMDC proposal.

Looking ahead to COP28, Pedroso acknowledged that it will be “challenging” but that there are important mandates to achieve like the operationalisation of the Loss and Damage Fund, reaching a Global Goal on Adaptation and holding the first Global Stocktake. “The unity of the Global South, of the G-77 and China group is important and I can say that we have common understanding on most of the issues on the agenda and we have a common vision for COP28,” he said.

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Rishika Pardikar

Rishika is a freelance journalist from Bengaluru.

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