At COP29 in Baku last year, countries agreed to mobilise US$1.3 trillion a year by 2035 for developing nations to tackle climate change. The pledge, part of the Baku-to-Belém Climate Finance Roadmap, aims to connect reforms in multilateral banks, private investment and new financial instruments into one global framework.
It is an ambitious goal, but also a familiar one. Every few years, the world announces a new finance target and then struggles to deliver on it.
The earlier US$100 billion commitment, made in 2009, was supposed to be met by 2020. Developed countries missed the deadline and only reached it in 2022. Even then, much of the money came from reclassified development aid rather than new or additional climate finance.
This experience explains why many developing countries are sceptical about the new trillion-dollar plan. The questions remain the same: who pays, how much of it will be public finance, and how can vulnerable countries access it?
Under the Baku Pact, developed countries are expected to provide at least US$300 billion a year, while the rest is expected to come from a mix of sources, including private investors, multilateral development banks (MDBs) and large emerging economies such as China. This flexibility might sound practical, but it risks shifting responsibility away from governments and placing too much emphasis on private capital and debt-based instruments.
For developing countries, this is a serious concern. Loans, even concessional ones, add to already high debt burdens. Many low-income countries now spend more on debt servicing than on climate adaptation or clean energy. Their consistent demand has been for grants, not more borrowing.
The Roadmap also relies heavily on reforming MDBs and mobilising private finance. While MDBs have a critical role, their ability to take risks or lend on softer terms remains limited. Reforming MDBs has been discussed for years with little change in practice.
Unless both developed and high-emitting emerging economies shoulder their fair share, the US$1.3 trillion goal will risk becoming what the US$100 billion target once was
Private finance can help scale up technology and innovation, and blended finance models that use concessional public funds to de-risk private investment are useful tools. But private money cannot replace public responsibility. The global response to climate change must rest on predictable, concessional public finance, with private finance serving as a complement rather than a substitute.
Expecting markets to fill the gap is unrealistic when structural barriers remain, such as weak regulations, currency risks and shallow capital markets in many developing economies. Mobilising trillions in private investment requires stable policies, guarantees and risk-sharing mechanisms that take years to establish.
The biggest challenge, however, is political. The UN climate framework still divides the world into “developed” and “developing” countries based on 1990 data, a classification that no longer reflects current economic and emissions realities.
China, India and Saudi Arabia are now among the world’s largest emitters and strongest economies. China, in particular, has become an upper-middle-income country by most measures, with a large industrial base and global investment footprint. Yet under the UN system, it is not obliged to contribute to climate finance. Its voluntary contributions, roughly US$4 billion a year between 2013 and 2022, are made under South-South cooperation, not binding commitments.
This is becoming harder to justify. As the climate crisis intensifies, responsibility must extend beyond the traditional OECD bloc. High-emitting emerging economies with both financial capacity and global influence should also contribute to climate finance, not just voluntarily. Climate finance must evolve from the old north-south divide to one that reflects today’s global economy and emissions profile.
The Baku-to-Belém Roadmap attempts to bridge these divides but risks satisfying no one. Developed countries prefer a broad goal that includes private and emerging-economy contributions, while developing countries seek clear public funding from those historically responsible for emissions. The compromise risks producing another impressive target without credible delivery.
At the same time, the discussion cannot overlook the question of climate reparations. For climate-vulnerable nations such as Pakistan or the Pacific island states, climate impacts are no longer distant possibilities — they are recurring economic shocks. Addressing loss and damage must therefore be central to any global finance framework. Without dedicated public funding and recognition of these reparations as a matter of justice, the most affected countries will keep paying for a crisis they did not cause.
As the world looks to COP30 in Belém, the stakes could not be higher. If COP30 in Belém is to be remembered as the “COP of Implementation”, it must confront these uncomfortable truths. Climate finance cannot depend on accounting creativity, voluntary pledges or misplaced faith in markets. Public finance must lead, concessionality must be protected, and loss and damage reparations must be recognised as both a moral and economic necessity.
The world does not lack capital. It lacks political will and honesty about who should pay. Unless both developed and high-emitting emerging economies shoulder their fair share, the US$1.3 trillion goal will risk becoming what the US$100 billion target once was: a symbol of ambition without delivery.