Global climate governance is confronting significant challenges, including the rise of “new isolationism,” an upsurge in protectionism and unilateral dominance by powerful players. Global climate governance is undergoing a raft of changes, such as structural shifts, model resets, platform changes and the absence of American participation.
Amid these changes, COP29 was convened on the 30th anniversary of the United Nations Framework Convention on Climate Change and managed to achieve key milestones, including the Baku Finance Goal agreement, the establishment of a loss and damage fund and the conclusion of Article 6 negotiations on the high-integrity carbon market under the Paris Agreement.
While these outcomes highlight the UN’s crucial role in multilateral governance, they do not preordain a smooth trajectory for global climate governance.
Structural shifts
The COP29 conference has established the Baku Financial Goal, or the New Collective Quantified Goal. It set a new collective quantified target for climate finance, which aims to reach at least $1.3 trillion annually by 2035 from both public and private sectors. Despite the Paris Agreement’s stipulation that developed countries, because of their historical emission responsibilities, should provide all climate finance, there has been significant disagreement regarding the structure, amount and sources of NCQG funding during the negotiations. The United States and European Union emphasize that the pool of NCQG donors should expand to include all capable countries, including emerging economies. The main objective of the NCQG's funding structure is to allow for developed countries to raise at least $300 billion annually for developing countries by 2035, with a focus on the least-developed countries and small island developing states.The so-called Umbrella Group, consisting of most developed countries outside the EU, suggests that the NCQG should be multilayered, with capable developing countries also contributing. Thus, while climate finance increases from $100 billion to NCQG’s $1.3 trillion, the structure and sources of funding undergo a qualitative change, with developed countries likely to press developing countries to contribute to NCQG funding through negotiations, effectively evading their historical responsibility.
Model resets
The Paris Agreement’s governance framework, which relies on a bottom-up approach of nationally determined contributions and is set to initiate the process for 2035 targets in 2025, originally followed the principle of “common but differentiated responsibilities,” “respective capabilities” and the “2-degree goal.”
However, COP29 negotiations reveal that developed countries, including the Umbrella Group, are pushing for new NDCs to align with the NCQG and a 1.5-degree target, while also advocating for the inclusion of a goods and services tax mechanism. This mechanism would effectively integrate carbon tariffs and other green trade barriers — supported by the UK, Norway, the Alliance of Small Island States and the Environmental Integrity Group — into the global climate regime. Incorporating such a tax into NDCs could upend the global emissions reduction model, shifting the responsibility for carbon taxes on internationally traded goods and potentially dismantling the historical common but differentiated responsibilities framework.
Platform changes
The UNFCCC serves as the central platform for global climate governance, with the COP leading the rules and processes — which is fundamental to maintaining a fair and equitable multilateral governance system.
However, COP29 negotiations reveal that the European Union emphasizes funding sources for the NCQG that could take the Global Response to Climate Change Task Force (initiated under the G20) as an action model in an attempt to use the G20 platform to apportion responsibility and advance new agendas. The United States has been actively constructing exclusive mini-multilateral platforms to shape new governance and rules, such as the Climate Adaptation and Resilience Emergency Plan (PREPARE), the Glasgow Financial Alliance for Net Zero, the Net-Zero Government Initiative, green shipping and the Trade and Technology Council. Given the difficulty of reaching consensus on new governance issues such as funding sources and NDC targets in a short time, the UN’s main governance platform will continue to be weakened and new governance issues will emerge on mini-multilateral platforms. The direction of the UN’s climate governance process will be undermined.
Absence of the U.S.
Trump withdrew from the Paris Agreement during his first term, and he has more recently pledged to end the Democrats’ Green New Deal, cease funding for the Green Climate Fund and exit the Paris Agreement once again. A second U.S. withdrawal would see the largest emitting developed nation abandon the global climate governance framework, leading to significant carbon leakage and undermining the confidence and motivation of other nations to cut emissions.
Moreover, the convergence of Trump 2.0 trade protectionism and green trade barriers could turn emission reduction responsibilities into a green trade balance issue, prompting countries to impose green tariffs and build green trade barriers. This could render climate funding unattainable, erode the “common but differentiated responsibilities” principle and fragment or even hollow out the UN’s climate governance process.
