Divergence and Convergence in Global Climate Finance: Post-COP28 Pathways for North-South Collaboration

Abstract

This research focuses on North-South cooperation in relation to the divergences and convergences of climate finance in the wake of COP28’s outcomes. This study draws important conclusions from the contrasts between developed and developing nations in the allocation of climate finance, examines the shortcomings of existing multilateral negotiating frameworks, and suggests new, innovative market instruments alongside traditional financing mechanisms. Climate finance globally has reached USD 1.3 trillion; however, there remains a marked imbalance in fund distribution by geography and sector. Developing countries are offered severely inadequate adaptation finance. There is also a stark divide in the approach taken by developed and developing countries towards climate finance—developed nations lean toward market and private sector-driven solutions, while developing countries focus on historical accountability and climate justice. Employing game-theoretic techniques, the paper puts forth a blended equitable/unequal assessment alongside a climate finance efficiency framework to construct an integrated evaluation proposal featuring blended finance, innovative risk-sharing mitigation instruments, and North-South cooperative climate financing frameworks. It is proposed in this study that to sustainably support climate funding goals, accessible yet effectively utilised cross-level fiscal allocation is required, illustrating a need for restructuring the climate finance framework.