How will the U.S. exit affect climate action?, Pg13

Key Highlights:

• President Trump signed a memorandum to withdraw the U.S. from the UN Framework Convention on Climate Change (FCCC) and the UN Intergovernmental Panel on Climate Change (IPCC).
• The U.S. is also in the process of exiting the Paris Agreement following an executive order issued on February 4, 2025.
• The U.S. exit could increase policy volatility, raising risk premiums for U.S. companies and exposing exporters to foreign climate-related trade measures.
• Developed countries mobilized $115.9 billion in climate finance in 2022, exceeding the $100 billion goal for the first time.
• Adaptation finance is lagging, with the UN Adaptation Gap Report 2025 estimating needs of $310-365 billion per year by 2035.
• At COP29 in 2024, governments agreed to a new collective quantified goal of at least $300 billion per year by 2035.

Detailed Insights:

• The U.S. withdrawal from the FCCC excludes it from the core framework of multilateral climate diplomacy, impacting participation in the reporting system for greenhouse gas emissions.
• Exiting the FCCC means the U.S. will not participate in Conference of the Parties (COP) negotiations, affecting its ability to shape rules for transparency, carbon markets, and financial architecture.
• The U.S. exit will reduce its influence over the Global Environment Facility and the Green Climate Fund, potentially leading to decreased contributions and affecting climate finance.
• The U.S. withdrawal from the IPCC could weaken its role in shaping scientific research on climate change, potentially reducing U.S. involvement in authoring climate reports.
• The U.S. decision weakens the expectation that other major players will adhere to shared climate rules, potentially hardening the positions of developing countries.
• Countries may become less willing to negotiate with the U.S. on issues like energy security and industrial policy due to concerns about the durability of U.S. commitments.

Key Concepts Involved:

• FCCC: The primary international treaty addressing climate change, aimed at stabilizing greenhouse gas concentrations in the atmosphere.
• IPCC: An intergovernmental body that assesses the science related to climate change, its impacts and potential future risks, and possible response options.
• Paris Agreement: An international agreement to combat climate change by limiting global warming to well below 2, preferably to 1.5 degrees Celsius, compared to pre-industrial levels.
• COP: The supreme decision-making body of the FCCC, where countries meet annually to assess progress in dealing with climate change.