Five Facts to Know: The Issues That Will Define COP28

COP28, the UN’s climate change conference, begins late November 2023 and will consider results of the first global stocktake (GST), which assesses how the global community has progressed against the objectives of the Paris Agreement. With the recent release of the first GST high-level synthesis report, it is now clear what exactly is at stake and what needs to be achieved to keep the world on track with the Paris Agreement. But even as the world contends with the multiplication of climate-induced extreme weather events, governments are struggling to balance climate action with growth prospects and energy security and are facing increased funding—if not climate—fatigue. In the lead up to the world’s climate conference, here are five facts to know about the issues that will define the outcomes of COP28:

1. The first global stocktake points toward a 2.6°c trajectory—with potentially catastrophic consequences

Article 14 of the Paris Agreement foresees that “Parties to this Agreement shall periodically take stock of the implementation of this Agreement to assess the collective progress…and undertake its first global stocktake in 2023.” COP28 in Dubai will consider the conclusions of that global stocktake. UNFCCC, the UN body to address climate change, already released its GST Synthesis Report earlier this month highlighting that despite progress, much more needs to be done to stay on track with the Paris Agreement—objective of “holding the increase in the global average temperature to well below 2°C above pre-industrial levels and pursuing efforts to limit the temperature increase to 1.5°C.” The report calls for “much more ambition in action” to reduce global greenhouse gas (GHG) emissions by 43% by 2030 and by 60% by 2035 compared to 2019 levels in order to reach net-zero emissions by 2050, as the IPCC—the scientific body advising the UNFCCC—called for in its sixth assessment synthesis report. The GST Synthesis Report points towards a 2.6°C trajectory—with potentially catastrophic consequences—at the current ambition level as reflected by the sum of domestic action plans under mandated nationally determined contributions (NDCs). This month’s New Delhi G20 Summit concluded with commitments to triple renewable energy capacity, but stopped short of stepping up mitigation objectives, a worrying signal from a group of countries that account for more than 80% of global GHG emissions.

2. Operationalizing the loss and damage fund is a sticking point for COP28 success

At COP27, approving a new Loss and Damage Fund for vulnerable countries was a precondition for developing countries to join the UNFCCC consensus. The existing real impact of accelerating climate change already affects food systems, biodiversity, infrastructure, and livelihoods, and so mobilizing funding now for this new fund has therefore become a major priority for developing countries. 

At the Africa Climate Summit in Nairobi this month, leaders “expressed concern that many African countries face disproportionate burdens and risks from climate change-related, unpredictable weather events and patterns.” In New York last week, on the margins of the UN General Assembly, leaders of the Alliance of Small Islands States (AOSIS) also underlined that “ongoing extreme weather and slow onset events emphasize to us all the critical needs to confront adverse climate impacts, and address loss and damage that is occurring and will continue.” 

Amid increasing “funding fatigue” among OECD countries, operationalization of the Loss and Damage Fund is likely to become a major sticking point for a successful conclusion of COP28.

3. Adaptation resources are inadequate and unequally distributed

Article 7 of the Paris Agreement established the Global Goal on Adaptation (GGA) of “enhancing adaptive capacity, strengthening resilience and reducing vulnerability to climate change.” At COP27 governments agreed on the way to move forward on the GGA, reaffirming that the GGA would contribute to reducing the risk of climate change impacts, the Adaptation Fund would have a central role to play in the pursuit of the GGA, and developed countries were called on to double adaptation finance.

At the intermediate 58th Subsidiaries Body meeting in Bonn (SB58) in June 2023, however—a meeting expected to prepare draft decisions for adoption at COP28—progress on achieving the GGA failed to materialize. This was particularly due to a G77+China group reluctance to set targets, while OECD countries supported a GGA framework focusing on “common and shared global adaptation priorities and modalities that national and subnational governments can choose to adopt in their adaptation planning.”

With the GGA meant to conclude at COP28 under the GST framework, the GST Synthesis Report already warned that most adaptation efforts were fragmented and unequally distributed among regions, leaving vulnerable countries particularly ill-equipped.

4. The developing world will require trillions—not billions—every single year to address climate change

COP15 in Copenhagen in 2009 called for an annual climate finance target of USD 100 billion—finally met in June 2023. The figures currently estimated for a climate transition are staggering: more than USD 2 trillion are needed each year in emerging and developing countries alone (excluding China) to tackle climate change and adapt to its impacts. Figures on tripling the deployment of renewables are estimated at USD 4 trillion per year by 2030 by the G20. It remains unclear, however, how to mobilize the trillions of dollars in public and private finance needed to operationalize the Loss and Damage fund (agreed upon at COP27 in Sharm el-Sheikh) and to meet the adaptation needs. The temptation is strong, therefore, to pass the buck from the UNFCCC process toward multilateral financing institutions.

Attention will indeed focus on the World Bank and International Monetary Fund (IMF) Annual Meetings on October 13–15. The World Bank is due to brush up its climate credentials under its new leadership and issue common guidelines to use concessional finance in addressing vulnerabilities, while the IMF report is to include climate vulnerability in debt sustainability assessments. More generally, it is expected that recommendations from the Paris Summit for a New Global Financing Pact (June 2023) will be further considered, including through the reallocation of at least 20% of member countries’ Special Drawing Rights (SDRs) as well assigning SDRs to regional development banks to enhance their firing power.

It is worth noting that on September 24 the China-led Asian Infrastructure Investment Bank also pledged to triple its own climate change balance sheet by 2030—a step widely seen as an answer to the World Bank’s climate action.

5. Calls to phase out—not down—unabated fossil fuels will drive debates

The recent Delhi G20 Summit revealed persistent disagreements around exiting fossil fuels, despite the GST indicating that it was essential to do so for unabated fossil fuels (that is, those without carbon capture and storage). The 2023 UN General Assembly also revealed divisions—including on the delay in phasing down unabated coal, particularly in Asia, and on peaking scenarios for global fossil fuel demand by the International Energy Agency. In parallel, a High Ambition Coalition Leader’s Statement signed by 17 world leaders—including France’s President Macron and Kenya’s President Ruto—was issued at the UN General Assembly calling for a “global phase out of fossil fuels.”

While the Glasgow Climate Pact will be remembered as concluding a summit during which last-minute wording on “the phasedown of unabated coal power” was introduced at the expense of “phaseout,” it remains to be seen if and how the treatment of fossil fuels—unabated or not—will find their way into any future COP “cover decision.”