Azerbaijan's COP29 climate finance fund gathers momentum With fossil fuel companies

Ahead of COP29, Azerbaijan is advancing its Climate Finance Action Fund (CFAF) with ongoing discussions about contributions from the fossil fuel sector.

Yalchin Rafiyev, Azerbaijan's Deputy Foreign Minister, COP29 Lead Negotiator shared updates on the initiative, Caliber.Az reports via local media.

Rafiyev revealed that negotiations are in progress with both Azerbaijani and international fossil fuel companies, including SOCAR and other private entities involved in oil, gas, and coal production. The specifics of the companies' contributions—whether they will be lump-sum payments or revenue-based—are yet to be finalized. The details are expected to be clearer as the climate summit approaches.

The CFAF, introduced on July 19 during the presentation of COP29 Presidency Action Plan in Baku, aims to gather an initial budget of $1 billion. The fund is designed to support developing countries and facilitate measures for reducing greenhouse gas emissions. It will focus on stimulating private sector engagement, funding research and development for climate change mitigation, and providing grants.

Rafiyev emphasized that the fund will reinvest its returns into new green projects and disaster relief efforts, ensuring a cycle of continuous support. Additionally, the COP29 chairmanship is negotiating with companies from Arab, European, and Asian countries, with ten firms already agreeing to sponsor the CFAF.

Azerbaijan is also launching the "Baku Initiative for Climate Finance, Investment and Trade Dialogue" (BICFIT) at COP29. This long-term dialogue platform will aim to connect finance, investment, and trade to support global climate action. Further initiatives include investments in human capital and the creation of the "Just Transition Investment Partnership to Develop Skills" to aid in climate change initiatives worldwide.

The 29th session of the Conference of the Parties (COP29) to the UN Framework Convention on Climate Change is scheduled to take place in Baku from November 11-22, 2024.