Editorial 1: COP29, climate finance and its optical illusion

Context

The scale and the quality of climate finance need to be raised, with sincere efforts being made to have a coherent climate finance architecture.

Introduction

Finance has been a major point of climate change negotiation since the launching of the United Nations-led climate change negotiations in 1991, producing the United Nations Framework Convention on Climate Change (UNFCCC) 1992. Article 4 (7) of the UNFCCC clearly says “that the extent to which the developing country Party will be fulfilling their climate action commitments is contingent on how much finance and technology they get from developed country Parties”.

 Paris Agreement and Financial Provisions

• The Paris Agreement retains, in Article 9(1), the provision relating to finance, binding the developed countries to mobilise finance for the developing countries.
• The sixth assessment report of the Intergovernmental Panel on Climate Change (IPCC) has described finance, capacity-building and a transfer of technology as critical enablers of climate action in developing countries in the backdrop of anthropogenic greenhouse gas emissions responsible for 1.1° Celsius of warming (above what it was in 1850-1900) in 2011-20.

 Falling short

• Developed Countries’ Commitment to Climate Finance (2009 Agreement): In pursuance of their responsibility, the developed countries agreed in 2009 that they would collectively mobilise $100 billion a year by 2020.
  • The $100 billion mark, met by the developed countries only in 2022, does not match the growing needs of climate finance corresponding to the developing countries’ nationally determined contributions (NDCs).
• Shortcomings of the $100 Billion target: Second, the mark has been considered in many reports to be well-short of estimated finance to fund the actions needed across different sectors to keep the average global temperature rise within 1.5° Celsius by the end of this century.
• The Role of COP 29 in setting New Climate Finance Goals: The 29th Conference of the Parties (COP 29) meeting at Baku, Azerbaijan, in November 2024, was meant for the Parties to the Paris Agreement to have a New Collective Quantified Goal on Climate Finance (NCQG),
  • replacing a $100 billion floor and laying a new floor taking into account the needs and the priorities of developing countries to tackle the climate crisis.
• Response to Developing Countries’ Demands for Increased Climate Finance: In response to persistent demand by all the major negotiating groups belonging to the developing south that the developed north mobilise $1.3 trillion by 2030, the developed north agreed to release only $300 billion per year by 2035.
  • The $300 billion mark ignores the estimation by the UNFCCC’s Standing Committee on Finance (SFC) relating to the annual financial needs of developing countries, which it derived from their NDCs.
  • As in the SFC’s estimation, the financial needs stand at between $455 billion-$584 billion.
  • Even these figures cover around half of the 5,760 costed and non-costed needs identified by 98 developing countries in their NDCs (Third Report of the Independent High-level Expert Group on Climate Finance, November, 2024).
• NCQG and Vulnerable Countries: The decision on the NCQG makes reference to the financial needs of those particularly vulnerable to the adverse effects of climate change such as the least developed countries (LDC) and small island developing states (SIDS).
  • But the NCQG does not make minimum allocation floors for the LDCs and SIDS.
• Demands from SIDS and LDCs: During the meeting, the Alliance of Small Island States demanded the allocation of $39 billion for SIDS while the LDC demanded at least $220 billion for them.
• Global Stocktake (GST) and its impact: It appears that the first-ever Global Stocktake (GST) in consonance with the Paris Agreement in 2023 also failed in influencing the cause of loss and damage concern in the NCQG.
  • In the GST estimation, economic costs are estimated to reach $447 billion-$894 billion per year by 2030.

India and the NCQG

• India’s Perspective on Climate Finance delivery: India’s perspective on the delivery of climate finance from the developed north to the developing south is derived from the equity frame expressed in the principle of common but differentiated responsibility and respective capability.
  • India joined the Montreal Protocol to protect the ozone layer from further depletion, which led to the setting up of a multilateral fund of $240 million, including an additional $80 million for use in India, China, and other eligible low-income Parties.
• India’s Position on COP29 Climate Finance: During COP29, India specified that the new floor should mobilise $1.3 trillion by 2030, of which at least $600 billion should come in the form of grants and concessional resources.
  • On other major agenda items, including the mitigation work programme, just transition work programme, and Global Stocktake (GST), India’s representative called for an adequate provisioning of finance and other means of implementation to fulfil them.
  • India’s submission of its NDC next year is contingent on a decision relating to finance (Earth Negotiations Bulletin—, November 22, 2024).
• India’s reaction to the NCQG adoption: India expressed its extreme disappointment on the adoption of the NCQG in its present form and shape, which was done without India’s consultation.
  • India raised serious objections against the COP29 presidency and the Secretariat for the way it was finalised, which is at the expense of trust, collaboration, and in contravention of the UNFCCC’s norm, on an issue created by the developed north but which affects developing countries more.
  • India outrightly rejected the NCQG.
  • India added that the NCQG expects the developing world to mobilise resources. In India’s view, the paltry sum will influence the ambition and the implementation of its NDC.

Conclusion: What the developed north must do

The pith and substance of the Paris Agreement are the NDCs. In expecting the developing south to bring out more ambitious NDCs relating to the mitigation of greenhouse gases and implementing the same effectively, it is equally important on the part of the developed north to raise their scale and quality of climate finance and also make sincere efforts in putting in place a coherent climate finance architecture. This will ensure adequate, directly accessible and affordable climate finance to the developing countries.

Editorial 2: The geopolitics of platform-publisher tussles

Context

Platforms facilitate publishers to reach a very large audience, and publishers offer platforms a stream of content to incessantly engage users.

 Introduction

Last month, The Australia Today’s coverage of External Affairs Minister S. Jaishankar’s visit was discussed less for its substance and more for being inaccessible on Facebook in Canada. Coming on the back of diplomatic tensions between India and Canada, were Mr. Jaishankar’s interview and joint press conference, covered in The Australia Today, inaccessible in Canada due to a nudge by the Trudeau government? Or was it part of Meta’s strategy to block news on social media platforms in Canada?

Canada’s Approach and Geopolitical Ramifications

• Some argue that this is a casualty of Canada’s approach to mitigate asymmetries between all-pervasive platforms, such as Facebook and Google, and news publishers, such as The Australia Today.
• The blackout has less to do with the politics of foreign policy and more to do with the politics of Meta’s corporate strategy.
• Mostly, it has to do with the geopolitical ramifications of developments in Canada’s media policy.

Symbiotic Relationship Between Platforms and Publishers

• Let’s start with the actors involved. Platforms facilitate publishers to reach a very large audience, and publishers offer platforms a stream of content to incessantly engage users.
• In this seemingly symbiotic relationship, only platforms know the true popularity of the news distributed to their users and therefore, the incremental advertising revenues trickling in from the content produced by publishers.
• Platforms are also known to change the metrics to gauge popularity and audience preference.
• These problems raise questions about transparency, accountability, and parity in the dealings between platforms and publishers.

Governing frenemies: Canada’s Online News Act (ONA) and Bargaining Framework

• In June 2023, Canada devised a bargaining framework for platforms to duly remunerate news outlets.
• The resultant Online News Act (ONA) sought to protect publishers from losing income that is justifiably due to them from Meta and Alphabet.
• These platforms are legally obliged to fashion commercial agreements with one or a group of publishers.
• If either party disagrees, a bargaining process ensues with the involvement of a mediator.
• If no agreement is reached despite this, each party can propose a final offer, and an arbitration panel is empowered to choose which offer becomes binding.

Comparison with Australia’s Bargaining Code

• Canada was the second country to move on this matter, after the Australian initiative of 2021, known as the ‘Bargaining Code’.
• While concerns over the financial health of local news websites led to the enactment of the ONA, the Bargaining Code has been criticised for legitimising a mechanism that safeguards the interests of giants in the news business.
• After initial opposition, Meta and Google negotiated deals with many, but not all, Australian news outlets.

 Google and Meta’s Responses to the ONA

• In Canada, Google complied with the ONA by agreeing to pay publishers and journalist associations.
• Meta adopted a contrary route: from August 2023, it foreclosed news offerings on its platforms, Facebook and Instagram, in Canada.
• However, web pages of journalists can still be accessed on both platforms.

 Meta’s Control Over News Websites

• Since the ONA does not define a news website, Meta decides which is a news site and which is an opinion or community site.
• For instance, Baaz, a Canada-based news outlet catering to the Punjabi and Sikh diaspora, was inaccessible for a while on Facebook and Instagram.
• After it switched to Substack, a subscription-based platform, and redefined itself as a ‘community page’, Baaz became visible on both platforms.

 Interrupting global flows

• Following the uproar over Mr. Jaishankar’s interview, Meta maintained that it blocks news in Canada, irrespective of its geographical origins.
• However, the editor of The Australia Today pointed out that prior to the interview, the content of the site was visible, suggesting that Meta restricted the site around the time the interview was posted.
• Such experiences render Meta vulnerable to criticism of selective compliance with the ONA.

Geopolitical Ramifications of National Media Policy

• The unavailability of the Jaishankar interview on Facebook in Canada also uncorks the geopolitical ramifications of national media policy.
• Regulations in Australia, Canada, and Indonesia have tackled the imbalances between platforms and publishers, as seen in their respective news markets.
• Consequently, these regulations vary in normative considerations, policy priorities, and institutional design.

Australia’s News Bargaining Incentive (NBI) Policy

• Recently, Australia disincentivised platforms that refrain from, or do not renew, agreements with publishers.
• Its News Bargaining Incentive (NBI) policy proposes to penalise platforms harvesting revenue of $250 million and more and failing to finalise agreements.
• This is to ensure, inter alia, that Meta does not replay its Canadian strategy in Australia, since earlier this year, it had announced plans to discontinue paying news outlets there.
• What is interesting is that the NBI also incentivises platforms by offsetting payments to publishers against some of their fiscal liabilities in Australia.

India’s Efforts to Tackle Publisher-Platform Asymmetries

• India has been tackling publisher-platform asymmetries since 2022, with the Competition Commission inquiring into the conduct of platforms, following pleas by news associations.
• It is unclear whether these efforts factor in the geopolitical dimensions of the matter.
• If the policy paralysis continues, India’s news outlets will continue to be devoid of fair shares of online advertising revenues, and vulnerable to the whims of the Alphabet-Meta duopoly.

Conclusion

Meanwhile, structural censorship, seen in the Jaishankar interview case, could recur. It will proliferate if Meta replicates its Canadian strategy in the U.K., South Africa, and Germany, where fair compensation regulations are being evolved. If so, interviews by Indian Ministers to news outlets in those countries will be inaccessible on Meta’s platforms there. Therefore, policy pundits must weigh in urgently on fair compensation.