The Global South’s Climate Aid Strategy is Flawed

Aashis Joshi

16 December 2024

On the last day of the COP29 summit held in Baku, Azerbaijan last month, rich countries agreed to a deal to finance climate action in the Global South. The announcement, however, was met with widespread dismay as rich countries pledged just $300 billion a year, far short of the $1.3 trillion that Global South representatives had demanded annually.

Such climate finance is intended as a mechanism for rich countries to help developing ones decarbonize and to compensate them for the losses and damages they suffer due to climate change impacts. However, the finance on offer consisted of private investments and loans from development banks rather than grants. This was unacceptable to many Global South countries that already redirect a large fraction of their annual budget away from social services, education, and healthcare to pay the interest on such loans. These financing schemes are little more than clever technocratic deceptions by the West to funnel their ill-gotten wealth back to themselves.

There is a legitimate moral case for grant funding given the historical and present-day context in which wealthy nations of the West and Global North have contributed the most to climate change while poorer nations of the Global South bear a disproportionate burden of its impacts. However, is it reasonable to expect substantial and sustained contributions from the former given geopolitical and climate realities?

The pittance that rich nations have pledged so far even as the world has experienced increasingly frequent and severe storms, droughts, floods, wildfires, and heatwaves in recent years should already be an indication. What is the likelihood that they will make meaningful contributions once climate change impacts start to impose greater burdens on their own economies? Even if these countries promise to do better over the coming years, we should expect their contributions to dry up. Climate finance and loss and damage funding won’t last long.

In light of this prospect, wouldn’t it be wiser for Global South nations to instead pursue action plans that will make us less reliant on the frankly improbable moral awakening of wealthy nations? Those that will help build self-sufficiency and resilience in our societies from within?

It is widely accepted that mitigating and adapting to climate change will require fundamental and widespread societal transformations. A study by the World Inequality Lab reveals that the differences between the carbon footprint of rich and poor people within countries are now even more significant than those between countries. Since the carbon footprint of people is highly correlated with their income and wealth, a good place to start would be to address economic inequalities within our own societies.

The kinds of recovery and resilience-building that climate finance from rich nations are supposed to facilitate could also be achieved by redistributing wealth within Global South nations. This would need to happen in tandem with ensuring equitable representation and participation in societal decision-making for the poor and marginalized members of our societies, who tend to be the most vulnerable to climate change impacts.

Of course this is going to be a great challenge, but the societal outcomes would likely be more meaningful and long-lasting. Inequities of class, caste, ethnicity, gender, and religion continue to plague many of our societies. By redressing them as a matter of priority we would not only reduce vulnerabilities but also enhance social cohesion and therefore the possibility for collective action to cope with climate change and halt ecological overshoot. Such an undertaking would empower Global South societies towards a greater degree of control our own destinies rather than leaving them contingent upon external actors and forces, thereby improving our capacity to achieve both near-term recovery and long-term resilience.

This may appear rather idealistic, but it is no more so than hoping for solidarity and goodwill from a callous and cynical reigning world order, especially under the specter of rising economic difficulties and geopolitical tensions due to accelerating climate change. Over the past year of the US-led West’s unrelenting support for Israel’s genocide in Palestine, it has become clear that rich Western nations intend to double down on imperialism and invest in advanced weapons and their military capabilities to control lands and resources at any cost. We must read the signs that the West has painted in the blood of the children, women, and men of Gaza.

Rather than ask for climate finance, Global South activists, scholars, and governments should demand wealthy nations to reduce their consumption of energy and material resources, which is the primary driver of climate change and ecological overshoot. Such degrowth of their economies is indeed a moral responsibility of wealthy nations, especially as demand for resources is accelerating to the extent that the global economy consumed almost as much materials in the six years between 2016 and 2021 as it did over the entire 20th century.

However, as they are not going to willingly fulfill this responsibility, we must help them reduce their overconsumption by cutting back on our economic ties with them. The nations of the Global North and West derive much of their wealth and power by exploiting Global South resources and labor. This drain is worth more than $10 trillion per year, amounting to $242 trillion over the period 1990-2015. For each $1 the Global South receives in aid from the North we lose $30 through unequal exchange. A far more judicious use of Global South resources would be to invest them in climate and ecological action ourselves—as well as mutual defense against the US-led West—rather than hoping they will trickle down to us in the form of climate finance from the West, especially in the form of onerous loans.

This proposed change of focus is not to detract from the efforts of activists and scholars whose work on climate finance and the loss and damage framework has inspired solidarity within the Global South and prompted a sense of accountability within climate action circles in Global North nations. Instead, it is about having the ambition and resolve to recognize and exercise our agency to transform our societal values and power structures within the Global South and beyond. In doing so we give ourselves the best chance of decolonizing ourselves and transitioning towards equitable societies that are best prepared to withstand the escalating losses and damages that climate and ecological breakdown will inevitably bring.