Ben Abraham is a senior consultant at the Talanoa Institute and a former senior climate finance adviser at the New Zealand Ministry of Foreign Affairs and Trade.
COP30 must deliver a significant outcome on finance to meet its billing as an “implementation COP”. For whatever commitments Parties reach on mitigation, adaptation, or protecting nature, they will not come to pass if finance flows do not align with their implementation.
At COP29 in Baku, countries agreed a new collective goal on climate finance. By 2035, it aims to channel $300 billion a year in public climate support and $1.3 trillion in wider investment to developing nations. The announcement made headlines, but many countries in the Global South left disappointed, arguing the sums still fell far short of what is needed.
And they have a point. Estimates of climate investment needs in the Global South until 2030 are on the order of $5.1 trillion-$6.8 trillion. At a global level, the International Energy Agency estimates annual clean energy investment must reach $4 trillion – more than triple current levels – to achieve net zero emissions by mid-century. At the same time, governments spent $7 trillion on global fossil fuel subsidies in 2022 alone.
The imbalance is stark. While the finance flowing in the right direction is increasing, too much continues to support high-carbon activities, and too little reaches the communities most exposed to climate impacts. For example, only a tiny share (2.5%) of global climate finance flows reach sub-Saharan Africa, despite the region’s acute vulnerabilities.
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These figures illustrate the conclusion of the Intergovernmental Panel on Climate Change that while there is sufficient global capital to close the investment gap for meeting the goals of the Paris Agreement, urgent action is required to redirect it.
Fully delivering on the new climate finance goal agreed at COP29 will be critical to the success of the Paris Agreement and donor countries are due to make renewed climate finance commitments this year. But as the statistics show, this cannot be where the conversation on climate finance ends.
This is where Article 2.1c of the Paris Agreement comes in.
Aligning finance with global climate goals
The long-term goals of the Paris Agreement envision aligning global finance flows with climate action. Article 2.1c of the pact is the goal of “Making finance flows consistent with a pathway towards low greenhouse gas emissions and climate-resilient development.” It sits equally alongside the goals of limiting global temperature rise to 1.5 degrees (Article 2.1a) and adapting to climate change (Article 2.1b).
There has also already been action in the real economy towards this goal. Many major banks and investors have pledged to align their portfolios with net zero and, despite backlashes in some contexts, the majority are still committed to do so. More than 50 diverse jurisdictions are developing or using sustainable finance taxonomies, and the market for green and social bonds has expanded rapidly, reaching $6 trillion in 2025.
But valiant as these bottom-up efforts are, they are fighting an uphill battle. Without political support from the top they will continue to lack the speed and scale required.
Balance and integrity are also issues: finance flows for adaptation receive much less attention than for mitigation (measures that reduce emissions), developing countries remain on the periphery of many initiatives, and oversight of potential greenwashing is insufficient.
Meanwhile, what have the UN climate negotiations done to address global finance flows? The answer is, unfortunately, not much. But COP30 presents an opportunity to change this.
Sending political signals on green finance
Since COP 27 in Sharm el-Sheikh, a series of workshops on Article 2.1c has created space for technical exchanges but not yet produced decisions to drive real-world change. The final workshop in this series has just taken place in Rome, and leaders will decide how to take forward Article 2.1c when they gather in Belém in November.
At the Rome workshop, the need for the UN climate process to better support the realignment of finance flows was widely recognised. Otherwise, the rules and norms shaping these efforts will remain uncoordinated and left to other institutions where climate is not prioritised and decision-making is much less inclusive and transparent.
While no COP decision can magically make all finance go green, the annual summits can send powerful political signals and leverage the Paris Agreement architecture to facilitate action and accountability.
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For Article 2.1c, this could be done by establishing a framework for tracking progress towards aligning finance with climate goals, guiding policies to redirect investment, and ensuring developing countries can access the capital they need. The framework should also support balanced attention to both adaptation and mitigation.
Political backing for the implementation of Article 2.1c would support COP30’s response to the ambition gap, with the national climate plans submitted so far still way off bringing us on track to limit global warming to 1.5C.
The importance of a COP30 decision on Article 2.1c
Properly crafted, a decision on Article 2.1c could send a powerful signal that governments understand climate action is not just about having ambition, but also about aligning the financial system with those ambitions.
For developing countries, this could signal that finance flows will finally help turn plans on paper into projects that change lives. For markets, it could provide the certainty needed to unlock greater private investment. For citizens, it can restore faith in international climate cooperation by tackling the issue at its core.
Among all the decisions Belém could produce, a strong outcome on Article 2.1c could prove the most significant. If finance continues to support fossil fuels at today’s levels, the Paris Agreement will fail. If it is equitably redirected to clean energy and resilience, there is still a chance to deliver.
While authority for the full suite of actions needed to achieve this lies beyond the remit of the UN climate regime, there is an important role for the COP process to play. Its credibility in an era of implementation depends on it.
