How did COP29 go for Nepal?

The 29th COP (COP29), held in Baku, Azerbaijan, brought together representatives from nearly 200 countries. The event focused heavily on climate finance, earning it the nickname ‘Finance COP’.

Negotiations at COP were conducted in groups, enabling participants to share perspectives, negotiate terms, and agree on common agendas. High-level sessions allowed the heads of delegations to address the assembly, presenting their country’s positions, priorities, and demands. While these speeches help amplify nations’ voices, the heart of COP lies in the negotiations and agreements.

Experts often warn against evaluating how a specific country fared at COP, as success is typically measured collectively rather than individually.

While it is difficult to assess how Nepal, as a country, specifically fared at COP29, the conference concluded with several decisions and outcomes relevant to Nepal.

First and foremost—financing. More than 80 countries, including members of the African Group, Barbados, Least Developed Countries (LDCs), and small island states, jointly demanded the needed additional financing beyond the $1.3trn already outlined for climate action. Experts estimate that $1.3trn is needed annually. These countries proposed a roadmap to the COP29 presidency to resolve discussions around the New Collective Quantified Goal (NCQG) for climate finance. This proposed target aims to enable climate action in emerging and developing nations post-2025, replacing the outdated $100bn annual goal set during COP15 in Copenhagen over a decade ago.

However, at the last moment on the final day of COP29, the presidency unveiled the final agreement. The deal sets an annual target of mobilizing $300bn for developing countries by 2035. Additionally, it establishes a long-term goal to scale up total climate finance flows to $1.3trn per year by 2035 which is rarely going to happen because the wealthy countries failed to meet the previous goal of $100bn on time. This decision sparked outrage among climate-vulnerable nations, who criticized it as inadequate given the urgent climate challenges they face.

Even the president of COP29 Mukhtar Babayev admitted the deal was imperfect and was insufficient to meet escalating needs. 

The group of LDCs expressed outrage and deep disappointment at the outcome of COP29. In a statement, they said, “Once again, the countries most responsible for the climate crisis have failed us. We leave Baku without an ambitious climate finance goal, without concrete plans to limit global temperature rise to 1.5°C, and without the comprehensive support desperately needed for adaptation and loss and damage. This is not just a failure; it is a betrayal.”

Nepal, as a member of the LDC group, echoed this sentiment. “The voice of LDCs is also of Nepal,” noted Nepali experts and government officials.

Manjeet Dhakal, a Nepali negotiator and Advisor to the Chair of the LDCs for the multilateral process under the United Nations Framework Convention on Climate Change (UNFCCC), acknowledged the mixed outcome. “While we did not achieve everything needed to fully respond to the climate crisis, the voices of the most vulnerable were heard. The work continues, and the fight against climate catastrophe goes on.”

He added, “We leave this COP with both pride and pain. Pride in the resilience of our bloc, as we fought valiantly for the survival of the most vulnerable, but pain that our hopes for true climate justice have not been met. On the positive side, securing $300bn annually is three times the previous $100bn target.”

Another significant decision at COP29 relevant to Nepal was the operationalization of market-based cooperative approaches (carbon trading) under Articles 6.2 and 6.4 of the Paris Agreement. After nearly a decade of stalled negotiations, the agreement finalized the rules for international carbon markets, enabling countries to trade carbon credits and collaborate on reducing emissions more cost-effectively.

The agreement’s two key elements include guidelines for country-to-country trading and the establishment of the Paris Agreement Trading Mechanism.

Maheshwar Dhakal, joint-secretary at the Ministry of Forests and Environment (MoFE), said COP29 has paved the way for countries to develop national policies and agendas on carbon trading. “It’s up to countries whether they want to pursue it through government-to-government (G2G) arrangements, government-to-private sector partnerships, or voluntary or competitive approaches.”

Dhakal acknowledged that Nepal, being relatively new to carbon trading, lacks extensive knowledge and experience in this area. “We should adopt a flexible approach in the initial phase and gradually become more competitive as we gain experience in the next phase. At least now, we no longer face the obstacle of international law hindering our progress,” he added.

The launch of the Baku Adaptation Roadmap and the Baku High-Level Dialogue on Adaptation—aimed at enhancing the implementation of the UAE Framework and establishing a clear path for the Indicators Work Program on the Global Goal on Adaptation (GGA) at COP30—is another significant development for Nepal. Dhakal highlights that some mountain-related issues were addressed regarding the GGA. “As further discussions on mountain agendas have been postponed to the next sessions, we cannot label this a failure, but neither do we have concrete achievements to show,” Dhakal said.

Loss and damage is another key area of interest for Nepal. At COP29, it was decided to ensure the full operationalization of the Loss and Damage Fund, a long-awaited development for climate-vulnerable countries. To date, total pledged financial support for the Fund exceeds $730m. It is expected that the Fund will begin financing projects starting in 2025. However, no further agreements were reached, and negotiations on the specifics were postponed to the next session.

“The calculation of the price of non-economic losses is challenging, and it cannot be done without capacity development. Unfortunately, Latin American and African countries had differing views on capacity development, preventing us from achieving a concrete outcome on this issue,” said Dhakal, who also serves as a board member of the Fund for Responding to Loss and Damage.

COP29 did nothing to implement the outcomes of the Global Stocktake Agreement, which called for phasing out fossil fuels and aligning climate pledges with the 1.5°C target. Parties failed to reach an agreement to include explicit commitments to transition away from fossil fuels, leaving this critical negotiation to be revisited at COP30.

According to Dhakal, climate action cannot progress without major carbon emitters phasing out fossil fuels and supporting vulnerable nations through climate finance for adaptation. “But we also need to take responsibility to protect ourselves. For example, the Thame flood was caused by a natural glacial lake outburst from Thyanbo, but the Kathmandu flood was the result of reckless and unplanned infrastructure development and our negligence,” he explained.

Manjeet Dhakal assessed the three major expectations from COP29. “For climate finance, I would rate it two out of 10. For mitigation, I would give zero because, regarding the Global Stocktake, we are still where we were before COP29—not a single step of progress. As for carbon trading, I would give full marks, as it has been fully operationalized. However, we had no issues with carbon trading earlier also, yet we are still not fully utilizing our potential in this area,” he said. 

Several agreements were signed by Nepal on the sidelines of COP29. These include the accreditation of the National Trust for Nature Conservation (NTNC) by the Adaptation Fund (AF) for five years, allowing NTNC to function as its National Implementing Entity (NIE). This accreditation grants NTNC direct access to the AF and enables it to develop and implement adaptation and resilience projects of up to $10m each. Additionally, an agreement was signed between the MoFE and the Swedish Energy Agency on emissions trading. Furthermore, MoFE and WWF Nepal launched two GEF-funded projects: Managing Watersheds for Enhanced Resilience of Communities to Climate Change in Nepal (MaWRiN), with a budget of $9m, and Building National Capacities of Nepal to Meet Requirements of the Enhanced Transparency Framework of the Paris Agreement (CBIT), with a budget of $1.65m.

However, Joint-secretary Dhakal stated that while Nepal entered into these agreements during COP29, they are not direct outcomes of the conference. “We would have signed these even if there had been no COP.” He added that Nepal’s key outcome from COP29 is the potential to receive three times the benefit in climate finance, the opportunity to extensively work on carbon trading, and the ability to focus on and enhance capacity development, drawing from the experience gained at large platforms like COP.

Experts also emphasized the importance of increasing Nepal’s qualitative and strategic participation, rather than focusing solely on quantity. The Nepali delegation to COP29 was led by President Ramchandra Paudel, marking the fifth time Nepal has been represented at the head of state or government level at the UN Climate Change Conference.

At these high-level conferences, heads of state or government deliver country statements during the leaders’ or high-level segments and participate in other high-level events. President Paudel addressed the World Leaders Climate Action Summit. “These statements are important as they reflect a country’s political stance on climate change and provide guidance for the ongoing negotiations,” said Manjeet Dhakal. “Nepal’s continued leadership at these global forums underscores its commitment to addressing climate change and highlights its evolving role—not only as a vulnerable country but also as a frontline leader in climate action.”

Minister for Forests and Environment Ain Bahadur Shahi was also actively engaged in various bilateral and multilateral meetings under the common agenda of ‘Protecting the Himalayas is Protecting the Earth.’

It is clear that Nepal is being heard on the global stage. For example, in May 2024, Nepal hosted the International Expert Dialogue on Mountains, People, and Climate Change, with Azerbaijan, the host of COP29, sending a representative to the event. Additionally, Nepal was invited to the pre-COP29 ministerial meeting for the first time in 12 years.