Even as the deadlock continues on finance negotiations at the COP29 meeting in Azerbaijan’s Baku, a new study has reminded the developed countries that it was in their economic interest to agree to the demands from the developing countries for $1.3 trillion in climate finance every year.
The study by researchers at Cornell University’s Cornell Atkinson Centre for Sustainability showed that the developed countries stood to gain 2 to 15 times return on their money over a 10-year period if they only financed the entire mitigation requirements of developing nations. The $1.3 trillion per year for climate finance was not enough to meet the requirements of the developing countries, the study said, as only the mitigation requirements would add up to about $10.5 trillion between now and 2035, of which the developed nations would need to put in $2.8 trillion of public finance to mobilise the remaining through private sources.
But the developed countries could hope to get far greater economic returns over this period, it said. If they paid for the mitigation costs in developing countries, about $2.8 trillion until 2035, they could hope for returns in the range of $5 to $41 trillion.
“Providing such climate mitigation finance to developing countries is not only a moral obligation (under Paris Agreement) but is also in developed countries’ economic interest. It delivers them a net economic benefit of between 5.1 – 40 trillion dollars over 2025–2035, corresponding to an economic return of between 180.2 – 1457.2 per cent on their 2.8 trillion dollar climate mitigation investment,” the study said.
“It turns out that global benefits from avoided CO2 emissions resulting from developed country’s offering of climate mitigation finance to developing countries can be broken down into country-specific benefits (in the developed world)… the benefits to developed countries far exceed their costs of giving mitigation finance to developing countries,” it said.
