What is the New Collective Quantified Goal?

Source: The post is based on the article “What is the New Collective Quantified Goal?” published in The Hindu on 22ndJune 2023

What is the News?

The Sixth Technical Expert Dialogue (TED 6) of the ad hoc Work Programme on the New Collective Quantified Goal was held at the 58th Subsidiary Body Meetings in Bonn, Germany.

What is New Collective Quantified Goal(NCQG)?

A commitment of ‘$100 billion per year till 2020’ to developing nations from developed countries was a target set at the Conference of Parties (COP) in 2009.

But estimates since then show addressing climate change may cost billions and even trillions of dollars.

Therefore, the 2015 Paris Climate Agreement agreed on setting a New Collective Quantified Goal (NCGQ) for climate financing prior to 2025 — a reference point which accounts for the needs and priorities of developing nations.

The NCGQ thus pulls up the ceiling on commitment from developed countries. It is expected to be finalized by 2024.

It will replace the current climate finance goal of $100 billion annually from developed countries.

What is the need for a new Finance Goal?

As per the OECD report, out of the promised $100 billion per year, developed countries provided $83.3 billion in 2020.

According to Oxfam, these figures may be misleading and inflated by as much as 225% as there is too much dishonest and shady reporting.

Moreover, the $100 billion target set in 2009 was seen more as a political goal, since there was no effort to clarify the definition or source of ‘climate finance’.

The economic growth of developed countries has come at the cost of high carbon emissions, and thus they are obligated to shoulder greater responsibility.

Moreover, while the funds available for climate finance have quantitatively increased, they are inaccessible, privately sourced, delayed and not reaching countries in need.

A recent study by the Centre for Science and Environment (CSE) found roughly 5% of climate finance comes from grants; the rest through loans and equity which burden developing countries with a debilitating debt crisis.

Countries most in need of finances have to wait years to access money and pay interest at high rates, thus increasing their debt burden.

What do Developed Countries say about NCQG?

Developed countries argue that NCQG must be viewed as a “collective goal” for all developed and developing countries.

Experts worry this argument pushes the “net zero” pathways onto developing countries, which cannot feasibly pay for mitigation, adaptation, loss and damage, along with sustainably developing key elements of infrastructure.

What is the way forward suggested by experts on NCQG?

Countries are on a tight deadline to agree upon the NCQG ahead of 2024. There’s no official number yet, but a global transition to a low-carbon economy requires investments of at least $4 trillion to $6 trillion a year.

Experts argue that instead of identifying a single aggregate figure, the NCQG could also set separate targets (or sub-goals) for focus areas such as mitigation, adaptation and loss and damage.