Traditional Conflicts and Dynamic Coali­tions at the World Climate Conference

First-ever Global Stocktake confirms urgency

The first-ever Global Stocktake (GST) was decisive for the outcome of COP28. The GST is to be performed every five years to review the collective level of ambition and imple­mentation in achieving the Paris goals in the areas of mitigation, adaptation and finance and to incentivize more ambitious commitments; thus, it is considered a cen­tral mechanism of the Paris Agreement. For this reason, the viability of the agreement itself, too, was on trial in Dubai. Owing to its relevance and thematic breadth, the text of the GST replaced the usual final dec­la­ration.

The stocktaking process began with a two-year technical phase that culminated in a synthesis report published in September 2023. The report warns that there are huge gaps in ambition and implementation in all areas. Even if the existing nationally deter­mined contributions (NDCs) were to be im­plemented, the global temperature would still rise by 2.4–2.6 degrees Celsius. The subsequent political phase of the stock­taking – the aim of which included draw­ing up recommendations on how the next round of NDCs could at least significantly reduce the existing gap with the Paris goals – was concluded in Dubai.

Just how concretely such recommenda­tions should be formulated had become a bone of contention in the run-up to the con­ference. The G77+China, a group of 134 countries classified as developing countries, saw the primary function of the GST as en­suring that industrialized countries, which historically have carried the main responsibility for climate change, are held accountable for their inadequate progress. For their part, industrialized nations called for a “for­ward-looking” stocktake – one that would at least urge the high-income emerging econo­mies, which are among today’s major emitters, to be more ambitious. Thus, almost inevitably, the discussion in Dubai on the conclusions to be drawn from the synthesis report became the stage for the traditional conflict between industrialized and developing countries over issues related to global justice and the interpretation of the principle of “common but differentiated responsibilities and respective capabilities” (CBDR-RC). Furthermore, some of the disputes over the GST played out in other negotiation tracks, such as the global goal on adaptation, and prevented more ambi­tious results being achieved in those areas.

Despite all these tensions, the parties did manage to agree on a wide range of recom­mendations. However, the deep rifts be­tween the various negotiating groups are easily recognizable in the final document. For example, the demands for the next round of NDCs, which are due in 2025, remained vague. While the parties re­affirmed the urgent need to accelerate climate protection in this “critical decade” and ensure the new climate targets are compatible with the 1.5 degrees Celsius target, the GST compromise merely en­courages the inclusion of all greenhouse gases and economic sectors in the NDCs for 2035 and 2040. In addition, trade policy tensions unexpectedly had an impact on the GST negotiations. At the centre of the dispute was the EU’s carbon border adjust­ment mechanism (CBAM), which some developing countries and the BASIC group (Brazil, South Africa, India, China) criticized as a “unilateral trade measure” that would jeopardize economic development outside the EU if there was no financial support or flexible design. Although the final docu­ment does not condemn unilateral trade measures in principle, the assertion that these should not be a means of “arbitrary or unjustified discrimination” reflects the enormous mistrust among many developing countries towards European climate policy.

The Loss and Damage Fund as a catalyst for success

Contrary to expectations, how to tackle the loss and damage caused by the consequences of climate change did not become a con­ten­tious issue. The establishment of a com­pen­satory fund for population groups threaten­ed by the climate crisis, which had been the source of much controversy for years, was decided at the opening session. The newly established fund immediately exceeded the minimum threshold thanks to financial pledges from the UAE and Germany of US$100 million each. In the days that fol­lowed, various countries pledged a total of US$770.6 million. Further, negotiations on the Santiago Network, which provides tech­nical support for loss and damage, were successfully concluded in Dubai. The loca­tion of the network’s secretariat within the institutional structure of the UN paves the way for work to begin promptly.

While the early operationalization of the Loss and Damage Fund was a diplomatic coup for the UAE – achieved in coordination with Germany – the future effectiveness of the fund remains in question. The fund has a broad thematic focus, covering everything from short-term extreme events to slow-onset and non-economic losses; but industrialized countries are not obliged to pay into it and no target amount has been set. The relatively small US contribution of US$17.5 million, which is contingent on the approval of Congress, came in for criti­cism. It is estimated that in total, the pledges – a large proportion of which is to be used for the institutional setting up of the fund – will cover just 0.2 per cent of the annual requirements of developing countries.

For many years, industrialized nations, above all the US, resisted demands for financial support from developing coun­tries, especially small island states. They were intent on avoiding any debate about their potential liability for climate damage due to their prominent role in historical emissions, which, however, the Paris Agree­ment excludes. As a result of the agreement reached at an early stage of the proceedings in Dubai, there was increased trust among the most vulnerable states – many of which belong to the HAC – in the multi­lateral process and controversy over histori­cal responsibility was prevented from spill­ing over into other negotiation tracks. More­over, the UAE became one of the first high-income emerging economy to partici­pate in climate financing. In what were clear references to China and the Gulf states, German representatives, in particular, had repeatedly called for such a devel­opment. As no other emerging country followed the Emirati example, the success remains symbolic for the time being. But in the context of setting the new collective quantified goal (NCQG) for climate financ­ing after 2025 later this year, the debate on expanding the traditional donor base could gain momentum.

Hardened fronts prevent ambitious adaptation outcome

Besides the fund for loss and damage, a key concern of those population groups acutely threatened by the climate crisis was the adop­tion of a framework for the global goal on adaptation (GGA). Adaptation to climate-related environmental change is extremely context-specific and improvements are dif­fi­cult to measure. The framework is intended to help assess progress in strengthening resilience and provide support for the most vulnerable countries and communities. It lists a number of categories such as health, agriculture and infrastructure, although the sub-targets remain vague and are not backed by quantifiable indicators – some­thing that is to be rectified over the next two years. Given the hardened fronts during the Dubai negotiations, the mere fact that there is agreement on the frame­work can be viewed positively; however, in its current form, that framework does not provide sufficient guidance. Despite the demands made by developing countries, the GGA has not been elevated to a perma­nent agenda item. Other negotiation tracks relevant to the topic of adaptation did not yield an outcome and were postponed.

As a priority of developing countries, adaptation has traditionally been closely linked to the issues of finance and global jus­tice. There is a huge gap between the amount of adaptation funding provided and what is required: it is predicted that the promise made by industrialized coun­tries to double the funds earmarked for this pur­pose to US$40 billion by 2025 compared with the 2019 level is neither achievable nor in proportion to the funds actually re­quir­ed, which, according to the UN Adap­ta­tion Gap Report, increase five- to tenfold each year. In contrast with mitigation projects, which tend to be profitable and attract private in­vest­ment, the profits to be made from adap­tation are indirect only. For this reason, adaptation projects are almost entirely depend­ent on public capital.

Unlike in other negotiation tracks, devel­oping and industrialized countries have not yet formed a viable coalition in the area of adaptation; as a result, old rifts have pre­vented an ambitious result from being achieved. The Dubai negotiations – just like the interim negotiations in Bonn – were strongly marked by the conflicts over CBRD-RC and the industrialized countries’ historical responsibility for climate change. The main bone of contention was the demand by the G77+China to include a spe­cific financing target in the framework, which the US, the EU member states and other industrialized countries refused. The latter pointed out that there was already a process for updating the target – namely, the negotiations on the NCQG. In the final text, the statements on international finan­cial support remained vague. Furthermore, to the frustration of vulnerable countries, the negotiations on adaptation were instru­mentalized for other issues. At times, members of the LMDC and the Arab group blocked the talks in order to impede pro­gress in the negotiations on the GST energy package. The criticism of this delaying tactic, which could be heard from devel­oping countries, among others, shows that there is also disagreement within the G77+China over adaptation.

Challenges for German climate foreign policy

German and European climate diplomacy contributed significantly to the results of COP28. Thanks to the skilful diplomatic efforts of both Germany and the EU ahead of the conference, the expansion target for renewable energies – which was officially presented for the first time as part of the Petersberg Dialogue in May 2023 – had already won the support of key players, above all, the UAE and the US. Germany’s contribution to the Loss and Damage Fund, closely coordinated with the UAE, generated positive overall momentum and paved the way for further commitments. The EU negotiating team helped maintain pressure on those opposed to a fossil fuel phase-out. Towards the end of the conference, German Foreign Minister Annalena Baerbock nego­tiated on behalf of the EU to reduce emis­sions. And despite criticism that Germany had not signed up to an HAC declaration in the run-up to the conference, the team led by Jennifer Morgan, State Secretary and Special Envoy for International Climate Action at the German Foreign Office, played a crucial role in the successful effort to form a coalition in favour of moving away from fossil fuels by building bridges between the various negotiating groups.

At the Dubai conference, the German government presented its long-awaited climate foreign policy strategy, which is intended to bundle the activities of minis­tries relevant for international climate policy and align them with common prior­ities. The central task of German climate foreign policy after COP28 should be to create the conditions for long-term and effective alliances against fossil fuel inter­ests. To this end, climate engagement out­side the COP process via bilateral and pluri­lateral partnerships is essential. During the coming year, such efforts should focus on the financing of renewable energies in devel­oping countries. Besides reaching agreement on a broader reform of the inter­national financial system, which is to be a priority of Brazil’s G20 Presidency, the suc­cess­ful conclusion of the negotiations on the NCQG at COP29 in Azerbaijan will be key.

On the day-to-day level, consistent co­ordination between the thematic experts of the respective line ministries and the diplo­matic capacity of the German Foreign Office (with its global network of embassies and representations) would further increase the effectiveness of Germany’s climate foreign policy. For example, the recent IPCC Ple­nary Session in Istanbul saw a well-coordi­nated push by the LMDCs around India, Saudi Arabia and China against aligning the next set of IPCC Working Group reports with the second GST in 2028. Diplomatic support in the run-up to the plenary session could have strengthened the negotiating position of the German delegation, repre­sented by the Federal Ministry of Education and Research. Going forward, Germany’s climate embassies could make a contribution through their standard diplomatic pre­paratory work by advocating for a more am­bitious timeline of IPCC reports in opposing countries ahead of the next round of nego­tiations.

The broad alliance in favour of moving away from fossil fuels that was formed in Dubai – and the room for manoeuvre pro­vided by it – will prove sustainable only if industrialized countries pursue ambitious domestic climate policies. The results of the GST must be swiftly implemented by the parties at the national level in such a way that the ambition and implementation gap is significantly reduced by 2030. The litmus test will be the updating of the NDCs, which all states must complete by 2025. For its part, the EU should assume a credible lead­er­ship role by presenting ambitious targets for 2035 and 2040 well ahead of COP30. A 90–95 per cent greenhouse gas emissions reduction target by 2040, as advised by the European Scientific Advisory Board on Cli­mate Change, could help encourage major emitters such as China and India to step up their efforts.

Germany’s tight budget situation did not have an immediate impact on the federal republic’s climate diplomacy in Dubai. But the national debates on financing, sector tar­gets and new natural-gas extraction projects abroad are under international scrutiny. Over the next few years, the EU must show diplomatic sensitivity when it introduces the CBAM; the concerns of partner coun­tries should be addressed constructively. Climate policy measures like the CBAM can be openly discussed on platforms such as the Climate Club, which officially began its work at COP28, in order to minimize trade policy tensions. A climate foreign policy that consistently integrates not only secu­rity, energy, trade and financial policy but also development cooperation can antici­pate and manage such challenges. To this end, it is imperative that German climate foreign policy and the Green Deal diplo­macy of the EU be interlocked, including outside multilateral negotiations.