Climate Finance Battle Reignites at COP30 Summit
The COP30 climate meeting in Belem, Brazil, which began on Monday, November 11, 2025, is poised for a major confrontation between developed and developing nations over climate finance issues that were supposedly resolved last year. The developing countries, led by India, have successfully placed a critical finance provision from the Paris Agreement on the provisional agenda, setting the stage for what promises to be a stormy two-week conference.
The heart of the conflict revolves around Article 9, paragraph 1 of the Paris Agreement, which clearly states that developed countries "shall provide financial resources" to assist developing nations with climate mitigation and adaptation efforts. Developing countries argue that this fundamental obligation was completely overlooked in the finance agreement finalized at last year's COP29 in Baku, Azerbaijan.
Unfinished Business from COP29
Last year's agreement in Baku focused exclusively on Article 9.3 of the Paris Agreement, which deals with the obligation of developed countries to "mobilize" financial resources. That agreement set a target for developed nations to mobilize at least US$300 billion every year from 2035, effectively tripling their current financial commitment.
However, developing countries maintain that the Paris Agreement establishes two distinct and equally important obligations: the provision of finance under Article 9.1 and the mobilization of climate finance under Article 9.3. These are related but independent commitments where one does not negate or take precedence over the other.
The crucial distinction lies in the nature of the funds. Article 9.1 implies the direct provision of public or government funds by developed countries, while Article 9.3 allows them to mobilize financial resources from private or other sources. Developing nations have consistently demanded that international climate finance should contain a significant component of public funds that are new, additional, predictable, and primarily in the form of grants or soft loans.
Growing Frustration Among Developing Nations
The $300 billion annual amount agreed upon in Baku came as a massive disappointment for developing countries, particularly since their demand for raising climate finance from the current $100 billion per year to $1.3 trillion annually had been completely ignored. India's delegation made an uncharacteristically angry statement in reaction to what they perceived as an inadequate commitment from developed nations.
The frustration boiled over at the mid-year climate conference in Bonn this past June, where developing countries disrupted talks for nearly two days specifically over the Article 9.1 obligation issue. This protest led to the decision to propose the matter as a formal agenda item for COP30.
Bolivia formally moved the proposal on behalf of the Like-Minded Developing Countries (LMDC) group, which includes India, resulting in the inclusion of Article 9.1 discussion in the provisional agenda that must be approved by consensus at the COP meetings.
Carbon Tax Controversy Adds to Tensions
The provisional agenda also features an item on "trade-restrictive unilateral measures," referring specifically to the Carbon Border Adjustment Mechanism (CBAM) – a form of carbon tax imposed by the European Union on imported goods. The CBAM system seeks to impose tariffs on imported products like steel or aluminum if their production involved a greater carbon footprint than standards required for EU manufacturers.
Developing countries have strongly objected to CBAM, arguing that it represents a restrictive trade practice disguised as climate regulation and violates international trade rules. This contentious issue had already surfaced at last year's meeting in Baku, where it stalled negotiations for two days and remains unresolved.
The approval of the provisional agenda itself could become a major point of contention, as developed countries are expected to strongly oppose the inclusion of Article 9.1 discussion. Recent COP meetings have seen agenda items triggering significant stand-offs, with some agendas only being approved in the second week of negotiations.
As the world watches the proceedings in Belem, the outcome of this finance battle will significantly impact global climate cooperation and determine whether developed and developing nations can find common ground on one of the most persistent sticking points in climate negotiations.
