With less than three months until the pivotal COP29 UN climate negotiations, countries are yet to converge on one of the summit's most significant tasks: setting a new funding target to assist developing nations in combating climate change.

A recently published negotiations document by the UN climate body sheds light on the stark splits between nations. This document will serve as the basis for intensive discussions aimed at inching forward on some of the summit's most contentious issues. Next month's meeting in Baku is pivotal in this regard as negotiators endeavor to narrow these divides.

The existing commitment of wealthy nations to provide $100 billion annually to developing countries will soon be replaced by a new target. However, the range of suggested targets varies widely, reflecting the competing stances of different countries. As it stands, vulnerable and developing nations are pushing for a much higher funding goal, while donor countries such as Canada and the European Union argue that their national budgets are too stretched to accommodate such demands.

Incoming COP29 president Mukhtar Babayev, who is also Azerbaijan's Minister of Ecology and Natural Resources, emphasized the distance that remains between different positions but remained optimistic. He stated, We have come a long way, but there are still clearly different positions we need to bridge. He assured that the COP29 presidency would organize rigorous negotiations on the finance goal ahead of the COP29 summit in Baku this November.

One of the options in the UN document, reflecting Arab countries' position, sets an ambitious target for developed countries to provide $441 billion each year in grants, combined with an aim to mobilize a total of $1.1 trillion annually from all sources, including private finance, from 2025 to 2029.

This is in stark contrast to the European Union's stance, which suggests a global climate-funding target of more than $1 trillion each year. This target would include domestic investments and private funding, with a smaller amount contributed by countries with high greenhouse-gas emissions and economic capabilities. The EU is also adamant that China, the world's largest polluter and second-largest economy, should contribute to this new climate-funding goal. However, China, still classified as a developing country under a system established by the UN in the 1990s, resists this notion. Beijing contends that wealthy countries should pay the lion's share of climate finance.

One of the biggest hurdles, negotiators agree, will be determining who should pay what. Canada has proposed that contributions to the target be determined based on per-capita emissions and income, a metric that could also bring countries like the United Arab Emirates and Qatar into the contributor pool.

The divide is also evident in the evolving positions of multiple stakeholders. The document that AFP consulted highlights seven rough options summarizing these opposing views. For instance, Arab countries advocate for a commitment of at least $441 billion annually in grants to mobilize further loans and private financing, bringing the total to $1.1 trillion. On the other hand, African countries have called for an annual target of $1.3 trillion.

Donor countries have voiced concerns over these ambitious amounts. The Rio summit of 1992 identified these donor countries, which include the United States, the European Union, Britain, Japan, Canada, Switzerland, Turkey, Norway, Iceland, New Zealand, and Australia. They argue that these targets are unrealistic, given that they now account for less than 30 percent of historic emissions. They propose expanding the list of donors to include China and Gulf countries, who staunchly refuse.

Another critical perspective comes from the European Union. While affirming that developed country Parties continue to take the lead in mobilizing climate finance from a wide variety of sources, instruments, and channels, the EU insists that the collective goal can only be reached if Parties with high GHG-emissions and economic capabilities join the effort. This aligns closely with the United States' stance that global investment flows, both public and private, must reach at least $1 trillion annually by 2035, a target not solely borne by rich countries.

Incoming COP29 President-Designate Mukhtar Babayev stressed the urgency of these negotiations, saying, We now only have 73 days before COP29 begins and Parties need to accelerate their engagement on this top negotiating priority to reach consensus. The upcoming weeks will be crucial for negotiators to find common ground amid these divergent positions and to work toward a cohesive strategy for climate finance that addresses the multi-faceted challenges of our time.