COP29 arrives at a pivotal moment as regions worldwide grapple with escalating climate impacts, high living costs, and, in South Africa, severe unemployment levels at 33.5% alongside low economic growth. These challenges are further exacerbated by geopolitical tensions, trade disputes, and growing divisions among Parties over issues such as carbon border taxes, particularly between developed and developing countries. For many nations, limited resources hinder decisive climate action, while developed countries have faltered on their financial commitments, instead attempting to reframe discussions around climate finance.

Priorities for Developing Nations

A primary concern for developing countries at COP29 is securing:

• Adequate, predictable, and large-scale support to implement climate actions and enable just transitions.
• Recognition of the right to development, including the necessary space to achieve these goals.

COP29 serves as a critical platform for advancing UNFCCC negotiations while creating opportunities for broader discussions about transforming the global financial architecture. Key reform areas include Multilateral Development Banks (MDBs) and International Financial Institutions (IFIs) to better support sustainable development through innovative solutions that benefit developing countries.

 Quality Finance: A New Collective Quantified Goal (NCQG)

The NCQG must be expanded and designed to meet the actual needs of developing countries across mitigation, adaptation, loss and damage, and just transition pathways. This new goal should increase financial resources that are adequate, predictable, and aligned with the needs of vulnerable nations.

While BUSA strongly supports the principle that developed economies must provide financial, technological, and capacity-building assistance, this support should avoid imposing undue financial burdens or conditions on developing countries. Critically, climate finance must not exacerbate current debt crises in developing countries.

Existing climate finance flows are insufficient and often reallocated from existing funds, unfairly transferring the cost of climate action to developing economies with limited fiscal capacity. Developed nations must increase their financial contributions and implement support mechanisms that do not escalate debt levels in vulnerable regions. Recent proposals for cross-border tax adjustments that target goods imported from developing countries to fund developed-country climate obligations are particularly concerning. From BUSA’s perspective, climate finance should be primarily grant-based, highly concessional, and free of conditions, prioritizing local value chain development. Such an approach would allow countries like South Africa to launch beneficial projects and attract private sector investments.

Adaptation costs in Africa are estimated to range from USD 259 to 407 billion by 2030, with an annual average need of USD 26 to 41 billion. A scaled-up, long-term financial goal is essential, based on the needs of developing countries and supported by a collectively negotiated roadmap.

Developed countries must meet their commitments under Article 9.1, including the $100 billion per annum target set in 2016. Failing to meet pre-2020 commitments has eroded trust among parties and in the multilateral process. Future support must be new and additional, avoiding the repurposing of existing funds. Developing countries should not resort to loans with burdensome conditions that limit their policy space and exacerbate debt crises.

Adaptation: A Priority for South Africa

BUSA supports global efforts to address adaptation gaps and backs the ongoing process to define a Global Goal on Adaptation (GGA). For South Africa, adaptation is a national priority, requiring substantial resources to build resilience and reduce vulnerability in the face of climate impacts.

The private sector, heavily impacted by climate risks such as extreme weather, also requires strengthened adaptive capacity. These measures are essential not only for industrial and supply chain resilience but also for the well-being of workers, communities, and ecosystems facing the brunt of climate change. South African businesses support the inclusion of indicators that measure the strengthening of adaptive capacity within the private sector in developing countries with significant physical climate risks.

Just Transition: Ensuring Social Equity

The ‘just’ component of the Just Transition has not yet received sufficient international attention. South Africa, a leader in Just Transition initiatives, is well-positioned to ensure alignment with national interests, development goals, and accessible finance. Flexibility is needed to support small, medium, and micro-enterprises (SMMEs) in this transition.

When leveraged effectively, the Just Transition offers a path to a net-zero future that promotes sustainability, inclusivity, and prosperity. Given South Africa’s priorities, particularly energy security, we emphasize the need for international partnerships providing both financial and non-financial support. A value-chain approach is crucial, considering affordability, market access, and meaningful participation from local businesses and SMMEs, to unlock investment and inclusive growth in green industries. Developing a skilled workforce, supported by a sound investment pathway, is also essential for the climate transition. Emphasizing skills development and training programs, especially for workers in traditionally hard-to-abate sectors, will ensure a more equitable transition.

Furthermore, BUSA expresses deep concern regarding unilateral measures taken by some developed-country parties, as these constitute discriminatory and unjust trade restrictions. Such mechanisms undermine collective efforts to pursue unique, nationally tailored just transitions by placing undue burdens on developing countries. We call on developed-country parties to reconsider these measures and suspend their implementation.

Nationally Determined Contributions (NDCs): A Balanced Approach

The private sector recognizes the importance of responsibly enhancing South Africa’s NDC ambition. This can be achieved by implementing the national emissions trajectory within the ranges specified in the NDC while refining just transition pathways. These efforts must be supported by clear financial flows and strategies that address socio-economic challenges. Increasing the ambition of the NDC must take into account national circumstances, including climate risks, energy security, and economic stability. Enhancing South Africa’s NDC should be approached cautiously, given the country’s development challenges and climate vulnerabilities. The lower bound of South Africa’s NDC range is recognised internationally as a fair and ambitious contribution, signalling our commitment to climate action despite domestic challenges.

Moreover, the NDC should highlight technology and capacity gaps, creating opportunities for private sector involvement in technology transfer and innovation from developed to developing countries. It should emphasize technology transfer and innovation, leveraging insights from developed nations to address technical capacity and financial resources for project preparation and de-risking innovative solutions.

Additionally, clear monitoring and tracking of NDC implementation progress relative to the Paris Agreement will help demonstrate South Africa’s achievements in mitigation, reinforcing the country’s role in global climate efforts.

Ends

Khulekani Mathe

Business Unity South Africa CEO Designate