Rising sea levels, tropical storms and droughts aren’t just destroying lives and ecosystems, they are also pushing lower-income countries further into crushing debt.
This year’s international climate talks – COP29 – should have been an opportunity to put an end to this injustice. It was a chance for the rich countries that are most responsible for the climate emergency to finally pay up for the damage they have caused. But, instead, lower-income countries have been left with broken and empty promises, forced to pick up the bill for a climate crisis that is not of their making.
What was at stake?
The annual climate talks had been billed as a ‘climate finance COP’. It was hoped governments would come to a meaningful agreement over the amount of money that should be made available to lower-income countries, to help them respond to and prepare for the climate crisis.
Climate justice groups and lower-income countries were calling for at least $1 trillion a year to be provided as grants, not loans, so climate vulnerable countries were no longer pushed into debt to cover the costs when disaster hits.
What happened?
You might have seen media reports saying a $1.3 trillion climate finance goal was agreed. This is an exaggeration – and an empty promise. Without clear commitments on how this money would be delivered, the announcement is meaningless.
In reality, rich countries have committed to help make $300bn available… in TEN years’ time! Lower-income countries need money now to deal with climate disasters that are devastating communities, but instead rich countries are kicking the can down the road. They don’t even have to provide these funds themselves if they don’t want – what’s counted as climate finance can come from a variety of sources, including the private sector.
What’s more, there is no guarantee that these funds will be provided as grants and not loans. Most climate finance is already provided as loans, and there is nothing stopping this continuing.
Why does this matter for debt?
Without enough climate finance, lower-income countries are footing the bill for a climate crisis that is not of their making. For many, this means having little choice but to borrow more to cover the costs of rebuilding when disaster hits.
During the conference, the president of Nigeria made a direct call for debt cancellation, while Pakistan’s top climate finance official highlighted the debt implications of unjust climate finance, stating that “the climate crisis is turning into a debt crisis”. We published a video with renowned climate activist, Vanessa Nakate, explaining how debt justice is critical to climate justice.
Right now, most climate finance to lower-income countries comes as loans, often with interest attached. This is adding to debt burdens, just at a time when debt levels for climate vulnerable countries are the highest they have been for 30 years.
In fact, many lower-income countries are currently spending five times more on debt payments than they are on addressing the climate emergency.
It’s not over.
Outrageously, the outcome of these talks will mean more debt for lower-income countries.
And as lower-income country representatives, climate activists and affected communities have said, the outcome does not deliver climate justice either. One thing is for sure though – they will keep fighting for justice, and we will be right beside them.