Breakthrough in Baku delivers $1.3tn “Baku Finance Goal”

November 24, Baku: The COP29 Presidency of Azerbaijan today announced the agreement of the Baku Finance Goal (BFG), a new commitment to channel $1.3tn of climate finance to the developing world each year. Success on the COP29 Presidency’s top priority for the UN Climate Summit represents a significant uplift from the previous climate finance goal of $100 billion and will unlock a new wave of global investment.

The Baku Finance Goal contains a core target for developed countries to take the lead on mobilizing at least $300 billion per year for developing countries by 2035. This represents a $50bn increase on the previous draft text, and is the product of 48 hours of intensive diplomacy by the COP29 Presidency. It pays special consideration to support the least developed countries and small island developing states, with provisions on accessibility and transparency. 

The Baku Finance Goal is the centrepiece of a package of agreements that deliver progress across all climate pillars. These breakthroughs are the result of months of intensive diplomacy by the Azerbaijani Presidency to deliver some of the most complex and controversial tasks in multilateral climate action. They mark a critical step in putting in place the means to deliver a pathway to 1.5C.

COP29 ended the decade-long wait for the conclusion of Article 6 negotiations on high integrity carbon markets under the UN. Financial flows from compliant carbon markets could reach $1 trillion per year by 2050. They also have the potential to reduce the cost of implementing national climate plans by $250 billion per year. When combined, the Baku Finance Goal and Article 6 will forever change the global climate finance architecture by redirecting investment to the developing world.

In the plenary session, Parties in Baku unanimously agreed to an expression of gratitude to the government of the Republic of Azerbaijan and to the people of Azerbaijan for the generosity and hospitality they demonstrated in hosting the 29th Conference of the Parties. 

The COP29 Presidency also succeeded in getting the Fund for Loss and Damage up and running and ready to distribute money in 2025. This decision was long awaited by developing countries, including small island states, least developed countries, and African nations. This aligns with the priority set by the President of the Republic of Azerbaijan, Mr. Ilham Aliyev, to address the challenges posed by climate change impacts on small island states under the COP29 Presidency.

COP29 President Mukhtar Babayev said, “When the world came to Baku, people doubted that Azerbaijan could deliver. They doubted that everyone could agree. They were wrong on both counts. With this breakthrough, the Baku Finance Goal will turn billions into trillions over the next decade. We have secured a trebling of the core climate finance target for developing countries each year.”

“The Baku Finance Goal represents the best possible deal we could reach, and we have pushed the donor countries as far as possible. We have forever changed the global financial architecture and taken a significant step towards delivering the means to deliver a pathway to 1.5C. The years ahead will not be easy. The science shows that the challenges will only grow. Our ability to work together will be tested. The Baku Breakthrough will help us weather the coming storms.”

The successful agreement of the Baku Finance Goal comes as part of a series of achievements that the COP29 Presidency delivered and secured, as in Annex 1.

The full text of the Baku Finance Goal can be found here

Annex 1: COP29 achievements  

Parallel to delivering a balanced package of negotiated priorities, the COP29 Presidency’s Action Agenda called on a wider group of stakeholders to contribute to global climate action. 

The Action Agenda Initiatives confront some of the most pressing problems, shine a light on forgotten priorities, offer unique solutions based on the experiences and perspective of the host, and reinforce coherence and COP-to-COP continuity. These Initiatives were designed in an inclusive and transparent process in consultation with all stakeholders. They serve to complement existing initiatives and bring new, creative approaches to climate challenges.  

Together, these Initiatives will support the implementation of ambitious climate action.  

• Baku Initiative for Climate Finance, Investment and Trade (BICFIT) Dialogue: The COP29 Presidency brought UN agencies, international organisations, multilateral development banks, multilateral climate funds, the private sector, civil society, key coalition, and other stakeholders, alongside COP Presidencies and Parties together to ensure that finance, investment and trade remain at the centre of the climate agenda. Announced the new Baku Climate Coalition for SMEs Green Transition. 
• Energy pledges and declarations: The COP29 Presidency launched its pledges and declarations on energy storage, grids, zones, corridors and hydrogen, which were endorsed by 150 Parties.  
• COP29 Declaration on Green Digital Action: More than 75 governments and over 1,100 members of the digital tech community endorsed the declaration to use digital tools to reduce emissions and strengthen climate resilience.   
• Baku Initiative on Human Development for Climate Resilience: A joint statement among 8 UN agencies, 3 MDBs and 3 climate funds, saw the adoption of the Baku Guiding Principles on Human Development for Climate Resilience and established the Baku COP Presidencies Continuity Coalition for Climate and Health.   
• Climate and Health Continuity Coalition: Five COP Presidencies (COP26 to COP30), alongside the WHO Director-General, embedded health into the climate agenda—and advocated for health to be a core feature of future COP conferences—by introducing the Baku COP Presidencies Continuity Coalition for Climate and Health.  
• Reducing Methane from Organic Waste Declaration: Over 50 countries—including 8 of the world’s 10 largest organic waste methane emitters and representing 51% of global methane emissions from organic waste—endorsed the declaration committing to sectoral targets to reduce methane from organic waste within future NDC, which will contribute to the implementation of the Global Methane Pledge.  
• Baku Harmoniya Climate Initiative for Farmers: A platform that brings together the dispersed landscape of existing climate initiatives in the field of food and agriculture, in order to make support for farmers easier to find and to facilitate access to finance. 
• COP29 MAP Declaration for Resilient and Healthy Cities: Brings together UN agencies and IGOs, MDBs, MCFs, philanthropic organisations, bilateral donors and implementing agencies for partnership and collaboration on urban climate finance, with over 160 endorsers, including more than 40 Parties, intending to work on multisectoral approaches to climate action and planning in urban areas. Launched Baku Continuity Coalition for Urban Climate Action, which takes a multisectoral and multilevel approach to continuity and coherence between COP, UNFCCC and UN Habitat urban processes.  
• COP29 Declaration on Enhanced Action in Tourism: Commits more than 60 government endorsers to promote sustainable tourism practices by reducing emissions and increasing resilience in the sector—ultimately positioning tourism as a key component of climate solutions.   
• COP29 Declaration on Water for Climate Action: With endorsers from over 50 countries, this declaration will take an integrated approach to combating the causes and impacts of climate change on water basins and water-related ecosystems. It advocates for the integrations of water-related mitigation and adaptation measures in national climate policies, including NDCs and NAPs.  

Significant progress made throughout the course of the two weeks  

In addition to its Action Agenda initiatives, the COP29 Presidency made progress in several priority areas for ambitious climate action. This included advancing transparency and securing funding for Loss and Damage. In addition to Presidency-led initiatives, Parties and other stakeholders stepped up and showed leadership with their own commitments.  

• The COP29 Presidency placed a significant emphasis on the importance of transparency and Biennial Transparency Reports (BTRs) by launching the Baku Transparency Platform and calling for early submissions from Parties, resulting in 11 Parties plus the European Union submitting before the 31 December deadline. Leading by example, the Presidency also submitted its own BTR.  
• Parties continued progress towards the goal of operationalizing Article 6, which would direct resources to the developing world and reduce the cost of implementing national climate plans. They reached consensus on Article 6.4 standards for trusted and transparent carbon markets and concluded negotiations on Article 6.8 which facilitates international cooperation through non-market approaches to implementing national climate plans and promoting sustainable development.  
• During the World Leaders Climate Action Summit, 80 Heads of States, Governments and Vice-Presidents delivered official statements on how they are advancing the Paris Agreement and committing to climate action, addressing the need to raise ambition for mitigation and adaptation. 
• Multilateral Development Banks (MDBs) announced projections for their contributions to climate action as $170 billion per year by 2030, with $120 for low- and middle-income countries.
• Positioned the Fund for responding to Loss and Damage to be ready to distribute funds in 2025 by securing contributor agreements and pledges as well as signing the host country agreement with the Philippines and hosting and trustee agreements with the World Bank. The largest contributions made during COP29 came from Australia and Sweden. Total pledges to the Fund to date have surpassed $730 million.  
• Countries—including the US, China, EU, UAE, UK, Brazil, Canada, and Nigeria—came together and announced policies focused on reducing methane from organic waste. 
• Ensured the participation of Small Island Developing States (SIDS) throughout the conference, creating opportunities for them to raise key priorities and concerns, such as accessibility of climate finance. 
• Brought together over 1,000 private and philanthropic leaders from more than 70 countries at the Business Investment and Philanthropy Climate Platform (BIPCP) where investor groups with over $10 trillion in assets united to deploy private capital into climate markets.  
• Pledges to climate finance projects and initiatives totaled $7.3 billion on Finance, Investment and Trade Day, with the largest support coming from the Asian Development Bank ($3.5 billion), the Azerbaijani banking sector ($1.2 billion), Sweden ($760 million) and Canada ($1.5 billion from the Canadian Government and $290 million from philanthropies) on investments in combating impacts of melting glaciers, green taxonomies, and climate action.  
• Development finance institutions pledged to support the 10GW Lighthouse Initiative for renewable hydrogen projects in emerging markets and developing countries. 
• Over 50 shipping industry actors agreed to accelerate zero and near-zero emission fuels by 2030, translating to at least 5 million tonnes of green hydrogen. 
• As part of a $193 million package for various clean energy initiatives, the UK supported clean cooking for 10 million people across Sub-Saharan Africa, South Asia, and the Indo-Pacific to leave coal and wood cooking behind. 
• Signified the role of cooperation and peace as indispensable to global climate action—with the COP Truce Appeal garnering support from 132 countries and 1,200+ organizations, as well as the Baku Call on Climate Action for Peace, Relief and Recovery being adopted, an initiative which will launch the Baku Climate and Peace Action Hub to address the urgent nexus of climate change, conflict, and humanitarian needs. 
• With Germany’s pledge of $65.1 million and Ireland’s pledge of $13 million, contributions to the Adaptation Fund reached $133 million.  
• Climate Investment Funds increased, collecting additional contributions from the US ($325 million), Germany ($220 million), and the UK ($211 million).  
• 25 countries and the European Union indicated their intentions to put forward national climate plans that reflect no new unabated coal in their energy systems and issued a call to action for others to do the same.  
• Mexico announced their commitment to net-zero emissions by 2050, meaning all G20 members have committed to a net-zero target.  
• Local Communities and Indigenous Peoples: Established the Baku Workplan of the Local Communities and Indigenous Peoples Platform.