Welcome to Zero.
I am Ukshatarti and I'm Michaelerel. This week COP twenty nine, Big Messy Deal.
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COP twenty nine is over and we have a deal. I was only there for the first week, so I've had a week to recover. But you've come straight to the studio directly from the airport.
How the heck are you exhausted? But we know this is how it ends. This is my fourth COP, so I was a little bit prepared that we're going to have an all nighter and we're going to be waiting for a bit, and we're going to be chasing for quite a bit, and we don't know how it ends. We are going to have to pick the pieces once everything is done. Seems there was at least a big deal, but not as much progress as people had hoped.
We're going to get into the specifics of what's in that deal and whether it's a good deal. But first I think it's worth returning to the question we laid out on the very first day of the conference about whether Iserbaijan was going to be up to the task of leading this summer in the first place. This was my first COP and there was a lot that impressed me about how things were run in Baku. Things went smoothly at the venue. The shuttle buses to and from
the Baku Olympic Stadium were very punctual. Things seemed organized, pretty reliable. The city seemed ready for this influx of visitors. The tourist district of Old City Baku is very charming, ready for people. Overall, how would you rate Iserbaijan's performance this cop, You're.
Right, the logistics were better than most cops. It is not easy to suddenly have an influx of fifty thousand people who are all waying to the same place and are there for official business, and so they have very little time and just need to get on with things. And Azerbaijan was able to pull that off. But we also found out that because it's an authoritarian government, they
could do a lot to make this happen. Baku's traffic is pretty infamous, and we didn't really experience much of it because they'd shut down schools and universities, asked most of their government employees to work from home. They had cleared up street vendors. They'd shut down these so called slave markets where mostly men show up for informal work, and there were no beggars to be seen, which are supposed to be a regular part of being in Baku. So you have to note that for the visitors it
wasn't what Baku usually is. But yes, it did make the COP work better.
So that was the experience for people In terms of interacting with the city, it was very seamless. But what about actually when it came time to negotiate and get things past.
There were a lot of complaints about the presidency, Mukhtar Babayev, who had never been much of a presence at COP meetings before and had never taken on a job of this level. And of course he had, you know, ten months to prepare, and he got plenty of advice. As we've learned, companies like Deloitte were involved in providing advice, but also past COP presidents and their teams were involved. And yet during these sophisticated, delicate negotiations between two hundred parties,
there is a level of forthrightness. There's a level of preparedness that a presidency needs to come in with and that was lacking and it really showed up towards the second week when the deal had to be done, and the documents had to come in time, but they were late, and the ingredients in those documents over things that people
would agree or disagree were all over the place. And it did seem like on Saturday, which was twenty four hours later than the official deadline of hop that things might just not fall in place and there might be no deal, and some of that blame would have been put on the presidency itself.
All the more difficult because we knew this was the finance cop Matt alone was going to make it hard because it's one thing to agree on some ideas on the abstract. It's another thing to agree to pay to cough up the bill. And there were two big things on the table. One of them was the NCQG, the new Collective Quantified Goal on climate finance, the big sum that rich countries would have to commit to. Let's start with that.
That's right. Coming in. We had a lot of different analyzes looking at just how much money this is going to be, how much can developing countries get from developed countries. And when we were on the ground, we got a chance to speak to developed countries and developing countries. So take a listen to one person we spoke to who is moment Khlored, Minister of Energy and Oil for Mauritania, one of the world's porest countries.
I think the main issue for Africa is financing to mitigate the impact of the climate change we get to hit because of the climate change. If look even at Mauritania, we have inundation now, we have a lot of rain, desertification, a lot of issues is causing a lot of problem. So I think we need to find a financial model where Africa can be financed to electrify, to improve the skills of its workforce, to cope with the migration of
people from the desert to the cities. So this is really what's needed to be looked at right now.
So he was really clear that the financing number was going to make a big difference for him in terms of what his country could do to elevate its standard of living and move towards a green future, and.
That money had to come from develop countries. And we got a chance to interview the Prime Minister of then Mark Meta Frederickson. Denmark has been historically a country that has been quite climbed forward, but when it comes to hundreds of billions or trillions of dollars. Even they will have to figure out how exactly they will deliver that.
Some goals and targets are one thing, but delivering is the next. Of course, a country like Denmark should deliver. We are pushing for ambitious target, but we also have to discuss who are going to contribute to this because it for me, I am totally convinced that a country like Denmark should participate and support this, but I think some of the new strong economies to participate, for example China, but also the Golf States.
So those are the stakes of why this money was so important and why even countries who want to support these ideas would have some concerns about the final price tag. What was the final price tag?
Three hundred billion dollars annually. It will be delivered by twenty thirty five and will be ramped up from current levels of one hundred billion dollars annually. Now, if you just took inflation between now and twenty thirty five, that will already cause the two hundred billion dollars to be just worth one hundred billion dollars today. So three hundred
billion by that time is in upgrade. But it's not that huge a leap, and so there were lots of complaints from developing countries that this sum is too low, that how exactly this sum will be counted, and where will this money flow is still not clear and that's not good enough. But on the flip side, you had developed countries, many of which, as we've seen in this year of elections, have taken a right word turn, are looking inward rather than outward, who have budgets that are constrained,
that are not willing to put anymore. So it was kind of a mine that even a larger sum was agreed upon and as we saw it really could have all fallen apart.
So there was a deal, but it was hard fought with a lot of trauma. Again, it was back in London by the time all this was going down, but my WhatsApp was exploding with hundreds of messages from the Bloomberg Climate team through every twist and turn on the plenary.
Yes, it was quite something. This is my fourth cop and we typically expect some fireworks to happen at the plenary, just like last minute tweeks in Glasgow. We had a phase down versus phase out fight in India and China were against the US and Europe and we expected nothing less here. Given this has been labeled the hardest COPS since Paris. What happened is that typically at the end of the COP it's a consensus, which means you, as the president, say to the parties, we are going to
be adopting this. Does anybody have any objections and if not, then the president can gabble it down and it's done. But consensus is not unanimity. The president has powers to overcome objections because Saudi Arabia has blocked voting rules at COP meetings and that gives the president powers to overrule objections. And in this case it's not clear, but as soon as the finance deal was put forward for adoption and
question about objections was asked. Very soon after that, the gavel went down and India immediately started waving their hands calling for a time out. They rushed onto the stage or talked to the president. They came back and afterwards they got a chance to speak and they said, we are unhappy with this process. This has been a stage managed process.
This has been stage managed and we are extremely, extremely disappointed with this incident.
It was perhaps one of the strongest pushbacks I've heard from a country at a COP meeting. Now, just so that we are clear, there's a technical reason why India was opposing the deal. In the current hundred billion dollars, there is a contribution from multilateral development banks such as World Bank or IMF that is counted towards climate finance.
Because these institutions put about fifty percent of their lending into climate projects, about fifty percent of their shareholding is rich countries, so that shareholding's contribution is counted towards the
climate finance goal. Going into this three hundred billion dollar figure, Developed countries wanted to count all of the shareholders in that goal, which would mean countries like China and India that do have shareholding in World Bank and IMF will also have their number counted towards the three hundred billion. From an Indian perspective, that would make rich countries less responsible towards the three hundred billion, because India's contributions are
being hunted and they did not want that. But the deal has been done and India will have to live with it, and we'll see how this fight shakes out and whether the trust in the process that is so crucial to keep two hundred countries together remains as we go into Bellham in Brazil.
Okay, so that was the NCQG. The other thing that we knew to keep an eye on was Article six, which talks about carbon markets, and some serious details needed to be ironed out on that. Where did things land there.
I was in the plenary hall when the Article six got gabled through by the President and there were quite a lot of cheers. One observer said, probably because they are happy they're never going to have to hear about Article six again.
And clearly people throughout the week kept saying, we've been talking about this for nine years, but you were saying it's even more than nine years.
Yeah, I mean the idea of carbon markets have been around for a long time. In the nineties, we had the CUTA Protocol, as we've discussed on the part before and then, and Article six were supposed to be an upgrade to that, and yes, it got done, but there are still plenty of issues that remain. There are questions around the integrity of the credits that will be traded. There are questions about these new types of markets that
would be operating between two countries. So Switzerland can make a deal with Ghana and maybe no third party verifies what that deal is. So we'll see how things shake out. You know, people have been talking and talking about Article six for more than a decade. Now these rules have been agreed on. They will have to be modified and tweaked if they're not working, if countries are not trading as you want, if the emissions reductions are not real.
And those who were cheering that we will hear less about Article six, I'm afraid we are going to hear a lot more about it.
So we talked about what was in the deal, but what was not in the deal, what was conspicuously missing.
Well, there was another piece of text that was called the Global Stock Take, which is basically the exercise that happened Dubai looking at what was the progress countries had made between the Paris Agreement in twenty fifteen and Dubai. And obviously we know that progress wasn't enough, but it was actually a numerical activity to find out just how far behind countries are and then take actions to try
and improve on those numbers. That's where we got the phrase transitioning away from fossil fuels, and there was supposed to be a document that said we are going to reaffirm what we agreed on at COP twenty eight, and we will go further and transition away from fossil fuels and put those into the national climate plans that are
supposed to be submitted over the next few months. That document, in the end did not get the support of all countries, and it has now been postponed for discussion at the next COP.
It seems like a bit of a step backwards because last COP, as I understand it, one big breakthrough, one big headline, was this consensus around the need to transition away from fossil fuels right correct.
What we've seen is that one actor among a few, has been really pushing heart names well, Saudi Arabia because we reported that in our stories, has been pushing hard to erase any mention of fossil fuels in not just COP meetings but many international forums like the G twenty and it has had a lot of success because it just doesn't want people to be talking about transitioning away
from fossil fuels, and the science is very clear. If you've signed on to the Paras Agreement goals of keeping temperature targets to one point five or two degree celsius. You are going to have to reduce your use of fossil fuels. But saying it out loud is clearly irking Saudi Arabia and they don't want people to be saying it. And we are going to see that fight play out again at the next come.
After the break, we turned to the question of one point five celsius and some other unfinished business left for Cop thirty. And if you've been enjoying this episode, please take a moment to rate and review the show on Spotify or Apple. It helps other listeners find the show. There's another thing that I heard a lot of discussion of in that first week, and I know carried on through the second week, which is the question of one point five c That's the level of warming the world
has been trying to keep under. That's been sort of the target, the point we don't want to surpass. The feasibility of that figure has been in question for some time. There's one quote that caught my eye from Panama Special Representative for Climate Change one, Carlos Monterrey Gomez, and he said we needed to leave Baku with an agreement to
keep the multilateral system alive. We kept the system alive, But I think one point five is dead after this COP is one point five C a number we should still be talking about.
So this year is likely to be the first year where temperatures are going to be, on average more than one point five degrees celsius relative to pre industrial levels. Now that is not the parish target. The parish target is a long term average of staying above one point five degrees celsius. But scientists are clear that we are
likely to surpass that too. Now within the Paris Agreement, there is a chance that you could go about one point five degree celsius and then come back down by drawing down carbon dioxide from the atmosphere technically feasible but very expensive. So yes, as a target that we should not breach, one point five C is likely dead because we will breach it. But the long term target of actually bringing it back down to one point five C isn't dead. And that's the thing that we heard again
and again from island states at COP twenty nine. For them, one point five CE they call it a death sentence because sea levels will rise, their homes will be inundated. They won't have places to go to. They're going to end up without homes, and so they are not willing to move away from this target. This is the thing they will keep pushing on, and from the rest of the world's perspective, it still makes sense to try and avoid every point one degree celsius of warming that you can.
So one point five CREE is likely to remain as a rallying cry, and the world will need to try to do as much as possible to avoid the worst impacts.
COP kicked off just a couple of days after the US election, as we've talked about in a couple of past episodes, and in the first days we were in Baku, we had a chance to catch up with Indonesia's Special Presidential Envoy, Hashim Joyohadi Kusumo, and he had something interesting to say.
I'm a bit wary, frankly, because of the change of government in the United States. I was in Marrakesh, you know, in twenty sixteen. I remember what happened. I mean, I detect the same sort of atmosphere for voting. I hope we can work things out between the parties, but we have to be wary, and I think everybody in this conference is weary, I think.
And I think he was onto something, because we did see flickers of chaos. At one point Argentina pulled negotiators out of COP twenty nine, and there was a risk that Argentina might also quit the Paris Agreement, as Donald Trump has said the US will do so. But towards the second week things come down a little bit. Argentina said they are not going to quit the Paris Agreement. We had Russia come out and say that actually, the US shouldn't leave the Paris Agreement, a twist I did
not see coming. And we did get a deal done.
And that deal happened despite many veterans of COP like John Kerry in the United States, Shia Genoa in China not being present, to not have those experienced hands guiding the negotiations toward the end, the fact that we got a deal done is a big deal, and it shows that the US, as much as it's a big power in the world, it's only twelve percent of global emissions, and the rest of the world still cares about haak climate change and they do want to get on with the job.
So Trump's election had somewhat of a limited impact but I did feel the geopolitics of this conference was very heavy, pretty unescapable. Even in the run up to things, when we were reaching out to heads of state trying to figure out who we might talk to in Baku, we heard from many countries like, oh, sorry, our plans are in flux because there's an election on the horizon. We
heard that from Ireland, we heard that from Japan. This was a big election year around the world, a lot of turmoil, and we saw a lot of incumbents doing poorly, a populist message resonating, a right word shift in a lot of major governments. How did all of that show up in your mind in those two weeks in Baku.
Given climate is a decadal challenge, political swings are power for the course. We know that right word shifts have happened in the past and climate action has continued despite it, but you're right, this moment feels more strenuous than it has in recent years. We got a chance to speak to Sophie Hermann's who is the Climate Minister of the Netherlands, and it gave us a sense of what a place that has seen a right word shift can do on climate.
Because Sophie now represents a four party coalition. Two of those parties do not want to do anything on climate and to want to and they have to come to this grand compromise to try and figure out how they'll meet their legally mandated climate goals, sit within the European Union, which has very ambitious climate targets, and make them all work despite the political shift. Here's what Sophie had to say.
Well, in this coalition, we agreed that what we stated in our law at the twenty thirty target but also the twenty fifty targets, it's non negotiable. That's what we are going to do and what we have to achieve. So there's no discussion about it, and now we have the discussion of how to achieve it.
So the theme seems to be it's very messy, but on we go, and that messiness wasn't just about politics and elections, but also about several wars that continue even as these talks played out. It was striking to go visit the Russia Pavilion with its life size Motroit cadals, and then right around the corner was the Ukraine Pavilion, which also had a very elaborate showing with these biodegradable
walls covered with seeds. Both countries quite engaged in the process, even as they are also engaged in a war.
And it's not just Russia and Ukraine. We caught up with the climaton way of Israel. Gideon Behar and I asked him, how do you think about climate change when there is a war happening? And how do you compare the timelines on which these two crises have to be How are you going to agree with people you are at war with.
Well, you know, the climate crisis is impacting all of us and it's a danger for humanity at all. So we really have to come to a consensus. And Israel is here because Israel is part of the international community. Israel is a dedicated member trying to make its contribution to solve the climate crisis. And we are here, so we will be part of a consensus.
And we did get ideal, and we shouldn't take that for granted. The multilateral process is a delicate one and it is currently being put under a lot of pressure. But that's what makes it interesting to come to a cop where all these countries do show up and jostle over the fate of the planet over the next century.
There was a line in the piece that you filed with reporters John Ainger and Jender Louis and Alfred Song kind of stayed with me on this point, and it was this idea that even though there was a deal, and here's the line, the process of global climate cooperation will lurch forward from here under the weight of heavier existential questions. This was already a pretty heavy cup. How much heavier can I get?
Look covering climate change day in and day out, there's just no way to escape heavier existential questions. You know, humanity is likely to survive this period, but perhaps in a very poor state if it doesn't do much, and perhaps in a very good state if it does a lot. But the heavier questions here are quite real. We've talked
about so many of them. The right would turn to politics, wars happening, the creaking of the multilateral system, the rise of competition instead of cooperation, the inward turn of countries in a time when global crises that required global responses are growing. That's what makes this beat so dynamic, That's what makes the progress so interesting, because the forces against it are so strong and to me The question at the heart of this equation is whether we can all work together toward progress.
We've already been looking ahead to COP thirty. In our last episode, you spoke to Brazil's Andre Corrier di Lago, the Secretary for Climate, Energy and the Environment. Brazil's the next host. They are planning to hold the conference in Belem, the gateway to the Amazon, a place that, again like Baku, isn't necessarily used to big influx of visitors. He was very cheerful and candid about all of this. He said
Brazil wasn't going to try to hide its problems. Brazil was committed to leading by example and embracing some of those contradictions. Given how things ended in Baku, what can we expect in Vilm.
There are a lot of expectations being put on on COP thirty in Belem. One is that, given we are behind these new national climate plans that countries have to submit, have to be much more ambitious. With a deal on finance at Baku, that becomes a little easier because countries will have so called conditional climate plans where they say, if this money does come through as was promised, we'll be able to do so much more to cut emissions.
But the other thing about this finance deal is that although three hundred billion dollars were agreed to, the needs for foreign investments into developing countries is about one point three trillion dollars per year that was acknowledged in the final deal. And there's going to be a road to BELLM program that is going to work on figuring out how to increase the sum of climate finance from three
hundred billion to one point three trillion. What exactly are these innovative financial instruments that could be used us to make that happen. So Brazil already had a lot to do and now it's got more on its table. But it seems Brazil is really committed on making this BELLM COP a real success and they've already begun that job as part of this troika that was created between COP twenty eight, COP twenty nine and COP thirty and a
lot of people are very excited about what's to come. Actually, thank you, thank you, And just to add, all of this work is not work that we do alone. We had a big team from Bloombergreen on the ground in Baku, and all of our coverage from those two weeks is free to read. Please do go check out bloomberg dot com, Forward.
Slash Green everything you need to know about COP twenty nine and COP thirty.
Thank you for listening to Zero and now for the sound of the week. In the one free afternoon I had in Baku, I went to visit mud volcanoes, which leaves methane. But the most memorable thing was the ride to the volcanoes, which happened in a nineteen eighty seven Russian Lada four by four, a vehicle as old as I am and one that felt like went at rocket speed on unpaved roads while I sat behind, holding on
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