COP28, Extreme Inequality, and the Incomplete Fight Against Climate Colonialism

Climate action requires acknowledging historical injustices and recognizing that climate change is largely driven by the elite in the Global North. Yet, extreme inequality and wealth concentration across countries stand at the crossroads of collective action to halt a climate breakdown. The solutions, therefore, must be aimed at reducing inequalities in addition to global emissions.

The United Nations (UN) Climate Change Conference, COP28, concluded with an agreement to “transition away from fossil fuels,” a development that several people, including US President Joe Biden and COP President (and head of the Abu Dhabi National Oil Company) Sultan al-Jaber,hailed as a “historic” moment.

But many others, including frontline communities, climate justice groups, and Indigenous peoples, criticized the deal as being unfair, inequitable, and no different than the status quo. For example, Anne Rasmussen, the Samoan representative and lead negotiator for the Alliance of Small Island States (AOSIS), pointed to the “litany of loopholes” that would only represent “an incremental advancement over business as usual” instead of the transformative change required.

What accounts for the varied perspectives? Inequality.

To explain the differences in opinion, there is a need to acknowledge the link between climate change and the current state of inequality globally. While it is no secret that a majority of high-income countries are responsible for the climate crisis, including the greatest share of greenhouse gas emissions (92 percent of excess global CO2 emissions), they have also failed to adequately address the problem, leaving low- and middle-income countries to bear the brunt of the consequences.

More than 91 percent of deaths caused by climate-related disasters in the past fifty years have occurred south of the equator. This will only worsen as heat stress deaths in the next ten years are expected to increase in low-income countries.

Meanwhile, elites in now higher-income nations were able to exploit the rest of the world for natural resources for economic gain. Not only did they exclude what are now considered developing countries from reaping any benefits, but they also consigned them to suffer from waste products generated from resource extraction.

At the core, the gap between expectations and outcomes and the discrepancy between the satisfaction of some and the frustration of others reflect the growing levels of inequality we live in today. As a group, low- and middle-income countries alike are grappling with providing their populations with basic necessities and working towards the same living standards as wealthier parts of the world. This, in turn, is hampering a collective response to the climate crisis.

Three critical manifestations of inequality must be addressed to make meaningful progress in transitioning to a clean, green, and equitable economy.

1. Reverse the global “trickle-up” of resources

Many in developing countries rightly strive to live better, more secure lives with standards of living comparable to the most developed countries. This will inevitably result in more carbon emissions and natural resource use as developing countries seek to provide for their populations. Therefore, developing countries have argued for a phase-out centered around equity, which they argue must be “fast, fair, funded, and forever.”

These arguments dovetail into the crucial debate on means of implementation in the Paris Agreement, which mandates each country to create and execute a nationally-determined contribution (NDC) encompassing mitigation, adaptation, and essential resources—be it financial, technological, or capacity-building—to alleviate climate change impacts. Most developed countries have not honored their legally-binding obligations under the Paris Agreement. Neither this historical responsibility nor a commitment to help developing countries tackle and adapt to the climate crisis was addressed in the global stocktake—a process that involved assessing progress made towards mitigating global warming. The first-ever stocktake concluded at COP28.

Indeed, despite the victory of creating the “Loss and Damage Fund” during COP27—a feat that was hard fought by civil society and activists for nearly 30 years—and despite finally becoming operationalized at COP28, it was met with wholly inconsequential contributions. In total, it has garnered pledges of USD 700 million, the equivalent of less than 0.2 percent (USD 400 billion a year) of the irreversible losses developing countries face from global heating yearly.

“The combined wealth of the 34 billionaires present at COP28, totaling USD 495.5 billion, is 682 times greater than the cumulative amount pledged so far by governments for the Loss and Damage Fund.”

This woefully inadequate response reflects the deep-rooted power imbalances that perpetuate global inequality. While wealthy nations have the resources to transition to clean energy and invest in climate resilience (though many choose not to), developing countries are often forced into unsustainable debt cycles to cope with the escalating costs of natural disasters and infrastructure damage.

Spending this year on debt service was 12.5 times higher than on climate adaptation and is expected to be 13.2 times higher in 2024. Furthermore, more than half (58 percent) of the climate finance allocated to heavily indebted countries was in the form of new debt. Perhaps even more concerning, lower-income countries, forced into debt to respond to the climate crisis, which they did not create, currently pay half of their external debt to banks, hedge funds and asset managers. These very institutions have not only invested in fossil fuels but have also reaped substantial profits from such investments.

While there is recognition that trillions of dollars will need to be raised, the decision text from COP28 has virtually no language on financing and fails to recognize the historic responsibility of the developed world. A transfer of money and technology from rich to poor(er) nations is especially vital at this juncture. It is needed for the development of clean and renewable energy (mitigation), the protection of at-risk communities against the impacts of extreme climate events (adaptation), and recovery efforts after climate-induced disasters hit (loss and damage).

2. The “rich and the rest:” Halt the wealth concentration and influence of the few

Narratives that divide the planet between the Global North and South risk masking the inequalities evident within countries, obscuring the true winners and losers within the current economic system. According to Oxfam’s new research, the five richest men have seen their fortunes more than double since 2020, while over the same period, five billion people have become poorer. It is not just the case that the wealth of a few billionaires is increasing but also that the number of billionaires, many of whom have made their fortunes from highly polluting industries, is on the rise. In fact, it is estimated that 125 billionaires have “an average of 14 percent of their investments in polluting industries.” Vast inequality and wealth concentration of this sort present a clear hindrance for individuals, communities, and countries to respond to the climate challenge.

The global one percent is responsible for more greenhouse gas emissions than the poorest 66 percent, or approximately five billion people on Earth. Meanwhile, it would take someone from the 99 percent 1,500 yearsto produce as much carbon as the top one percent in a year.

Large segments of the population in even wealthy countries struggle to make ends meet: for instance, 53 percent of the world population live on less than USD 10 a day, and a further nine percent live on less than USD 1.90 a day. Whether in Pakistan, Costa Rica, or Canada, many communities often face poverty, precarious employment, and exposure to hazardous working conditions and extreme weather events. The affluent minority remains shielded from these realities wherever they are in the world.

The interests of these “pollutocrats” starkly contrast with those of the rest of the population. And yet, they have the greatest presence at important negotiating tables. Fossil fuel lobbyists and elites gained unprecedented access to the negotiating rooms at COP28: a staggering 2,456 fossil fuel lobbyists attended COP28, outnumbering official Indigenous representatives by seven to one.

The number of fossil fuel lobbyists also far exceeded the combined representation of delegates from the ten most climate-vulnerable countries, including Somalia, the Solomon Islands, and Sudan. Even before the conference, many oil and gas companies had reached out to member countries, urging them to reject any agreement aimed at phasing out fossil fuels ahead of the negotiations. When international processes and national governments become beholden to those with excessive wealth, the chances of backroom deals that influence and shape rules and regulations without public consent or knowledge go up. This, again, is a death knell for effective climate action.

Under these circumstances, it is hardly surprising that the final deal made no mention of a fossil fuel phase-out, and, in fact, global carbon emissions from fossil fuels are at an all-time high.

3. Prevent a “cleaner but meaner” society: Invest in people, communities, and social protection

Deliberations at any future COP should not revolve around protecting the interests of those who have invested in fossil fuels. Instead, the focus should be on ensuring a fair and equitable distribution of the advantages stemming from the transition, aiming to improve the lives of those most susceptible to the impacts of climate change. Subsequently, we should progress towards determining the most effective means of directing financial resources to individuals and communities in the greatest need rather than catering to corporate interests.

A false dichotomy is often presented between policies to protect the climate on the one hand and growth and development on the other. In reality, new green industries present a key opportunity that could be worth USD 10.3 trillion to the global economy by 2050, equivalent to 5.2 percent of the global gross domestic product (GDP) that year. The hindrance to action lies not in a lack of resources but in a deficiency of political will and innovative thinking. However, without thoughtful policy design and clear intentions, green transition policies risk harming vulnerable populations, imposing an unjust burden on specific groups, and potentially consolidating even more wealth in the hands of a few.

Green transitions will inevitably cause disruptions disproportionately affecting workers in declining sectors and their communities, who often have the fewest resources to withstand repeated shocks. It is imperative to establish a well-communicated and carefully crafted transition plan that encompasses a range of social protection measures. These measures should include education, reskilling, and training programs aimed at empowering workers to thrive in green industries, to strengthening social safety nets to enhance the resilience of communities facing disruption. If fears are left unaddressed, they may escalate into anger, which could lead to a “greenlash” against well-intended policies or even social unrest.

Some countries have already begun this process: Germany’s Euro 2.5 billion Territorial Just Transition, for example, is expected to help four regions in the country transition to climate neutrality without leaving anyone behind. Climate action not only holds the potential to prevent backlash to impending changes but also to foster equitable and inclusive societies, rebuilding trust in the social contract between communities and the state.

Climate action must go hand in hand with tackling underlying inequalities

In conclusion, to achieve a truly just and equitable transition to a low-carbon economy, we must address the structural inequalities that underpin the climate crisis. This requires a significant increase in innovative climate financing and a comprehensive reform of the international financial architecture to ensure that vulnerable populations have equitable access to resources and support. It also demands that we prioritize the well-being of people and the implementation of a just transition in every country rather than focusing on the interests of the super-rich.

Only by dismantling the barriers that perpetuate global and local inequities, emphasizing our shared humanity, and empowering our sense of global solidarity can we build a more resilient and sustainable future for all and respond to the universal desire for a safe and secure life on a healthy planet.