Climate Change Negotiations – UNFCCC, COP, Other Conventions and Protocols

New Collective Quantified Goal (NCQG) in Climate Financing


From UPSC perspective, the following things are important :

Prelims level: New Collective Quantified Goal (NCQG)

Mains level: Not Much

bonn climate

Central Idea

  • The New Collective Quantified Goal (NCQG) has emerged as a significant commitment in global climate financing at the recently-concluded Bonn climate conference in Germany.
  • The conference, which sets the stage for the upcoming Conference of Parties-28 (COP28) in Dubai, has exposed significant gaps in funding for climate action.

Conference of Parties (COP)

  • The Conference of Parties (COP) is a key international event where countries come together to address the urgent challenges posed by climate change.
  • It is the supreme decision-making body of the United Nations Framework Convention on Climate Change (UNFCCC).
  • The COP brings together representatives from various countries to assess progress, negotiate agreements, and establish international climate policies and commitments.
  • The first COP took place in 1995 in Berlin, Germany, following the adoption of the UNFCCC in 1992.
  • Since then, the COP has been held annually, with each event designated by a specific number (e.g., COP21, COP22) indicating the sequential order.


What is New Collective Quantified Goal (NCQG)?

  • The commitment of $100 billion per year till 2020 to developing nations by developed countries was set at the 2009 COP.
  • The cost estimates for addressing climate change indicate that billions, and possibly trillions, of dollars are required.
  • The 2015 Paris Climate Agreement emphasized the need for a NCQG for climate financing before 2025.
  • The NCGQ aims to account for the needs and priorities of developing nations and has been termed the “most important climate goal.”
  • It should reflect scientific evidence, respond to increased funding requirements for Loss and Damage, and involve developed countries increasing their commitments.

Need for NCQG

  • Developed countries provided $83.3 billion in 2020 out of the promised $100 billion per year.
  • However, an analysis by Oxfam suggests that these figures may be inflated by as much as 225% due to misleading and dishonest reporting.
  • The $100 billion target set in 2009 lacked clarity in terms of the definition and source of ‘climate finance.’

Challenges and Concerns

(A) Accessibility and Sustainability of Climate Finance

  • While the funds for climate finance have increased, they remain largely inaccessible to developing countries.
  • The majority of climate finance comes in the form of loans and equity, burdening developing nations with a debilitating debt crisis.
  • Only around 5% of climate finance is provided as grants, which severely limits the capacity of countries in need.

(B) Developed Countries’ Perspective

  • Developed countries argue that the NCQG should be seen as a collective goal for all countries.
  • This perspective places the burden of mitigation, adaptation, and loss and damage on developing countries.
  • Experts raise concerns that developing nations may struggle to bear the costs while also ensuring sustainable infrastructure development.
  • Developed countries advocate for mobilizing private-sector investments and loans as a critical component of climate finance.

Future roadmap

  • A deadline looms for countries to agree on the NCQG before 2024.
  • While there is no official figure yet, estimates suggest that transitioning to a low-carbon economy requires annual investments of $4 trillion to $6 trillion.
  • Some propose setting separate targets or sub-goals for focus areas like mitigation, adaptation, and loss and damage instead of a single aggregate figure.
  • The focus should be on scaling up concessional financing, halting debt creation, and transforming the NCQG into an equitable and people-led transition process.

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