The problem that the United Nations’ annual climate conference was meant to solve this year was, in one way, straightforward. To have any hope of meeting their commitments to holding global warming at bay, developing countries need at least $1 trillion a year in outside funding, according to economists’ assessments. Failure to meet those commitments will result in more chaotic climate outcomes globally. Everyone agrees on this.

And yet, after two weeks of grueling, demoralizing negotiations, the assembled 198 parties agreed to a deal that was, in the most generous terms, weak. The agreement committed to $300 billion a year, by 2035, in funding for climate action in developing countries—triple the current target but less than a third of that trillion-plus goal.

These negotiations have operated on the presumption that a significant chunk of this money would come from wealthy countries, because where else would it come from? A limited number of places—the U.S., Canada, Australia, New Zealand, Japan, Israel, and Europe—have been the source of 92 percent of excess carbon emissions since industrialization. The countries that are bearing the brunt of climate change largely didn’t emit the carbon causing it. And the wealthiest countries failed to make a financial commitment even close to what was needed. “They’re really finding ways to avoid their responsibility,” Nafkote Dabi, the climate-change-policy lead at Oxfam International, told me.

Even the climate financing that was agreed to is not just a cash handout. Previous agreements had promised $100 billion annually, a goal that the world claims to have finally managed to hit in 2022. But about 70 percent of that financing came in the form of loans. Much of the money in this agreement will likely be structured as debt too—and will add to a global debt crisis that the International Monetary Fund estimates has 35 countries in dire financial straits this year. Dabi described debt—both a country’s existing national debt and climate finance taking the form of new debt—as the elephant in the room at COP. Even as developing countries worried about their debt burden growing from funds promised at the conference, they worried that discussing debt forgiveness would derail the already fragile negotiations.

But both national debt and new climate debt stand in the way of COP’s stated goals. Towering national debts are stifling countries’ ability to invest in climate resilience: Some 3.3 billion people live in countries that spend more on servicing the interest payments on their debt than on education or health, let alone climate adaptation. And as climate change fuels hurricanes, droughts, and other disasters, the country must take on more debt to respond. African nations in particular are struggling. Last year, the chief economic adviser for Kenya’s president tweeted, “Salaries or default? Take your pick.” The country’s economy is collapsing under the weight of debt repayments. Kenya is also ricocheting between drought and flooding, and although climate funding might help build irrigation systems for drought-stricken farmers or finance renewable-energy infrastructure, it could also exacerbate the economic crisis if it arrives in the form of debt, adding to a burden that itself makes people that much less resilient to climate change’s challenges.

Pakistan is perhaps the clearest example of how debt and climate risk can send a country into a downward spiral. It is one of the countries most loaded with external debt, owing some $100 billion to mostly the Asian Development Bank, IMF and World Bank, and a handful of wealthy countries including China, Japan, and the United States. And disasters worsened by climate change only add to its hardship: In 2022, for instance, flood damage amounted to $30 billion in losses. Pakistan can never repay its debts, and natural disasters will push it to rack up more.

Dramatically lessening Pakistan’s debt would offer some recognition that the country is suffering under climate conditions it was not responsible for creating, and to which it will struggle to respond otherwise. Mark Brown, the prime minister of the Cook Islands, has called for countries on the front lines of climate change to have their national debts forgiven, and the president of Nigeria recently wrote that offering climate financing to African countries without restructuring their debts would be like “pedaling harder on a bicycle as its tires go flat.”

There is precedent for mass debt forgiveness: In the 1990s and early 2000s, the IMF led the Highly Indebted Poor Countries initiative to restructure debts. It managed to cut out up to 64 percent of the countries’ debts on average. Kevin Gallagher, the director of the Boston University Global Development Policy Center and an expert on climate finance, told me he’d like to see a new program like it, but one meant to wrangle the many private bondholders that have since entered the debt market. These companies, he says, tend to be reluctant to grant a country debt relief, despite charging extremely high interest rates meant to cover losses in the likely case the country defaults. “They’ve already priced it in,” he told me. Right now, China and other major debt holders are then also wary of offering debt relief, knowing the debtor country will likely use any financial breathing room to pay the private bond market.

China, which is the single biggest creditor of any country in the world, is actually a far more progressive lender than private bondholders, experts say. China can be reluctant to restructure countries’ debts when they’re at risk of default, but it also lends at much lower interest rates than private bondholders. And few other creditor countries have been willing to entertain cutting debts as part of a climate-resilience strategy either, according to Jason Braganza, a Kenyan economist and the executive director of the African Forum and Network on Debt and Development. If a major debt-restructuring initiative managed to get China, other creditor countries such as the U.S., private bond markets, and global-development banks to the table, that could alter the fate of the world: Although every one of the poorest indebted countries could default on its loans without having a huge impact on the global financial system, the financial strain of them defaulting—and tumbling into austerity—would drag down the global economy, Gallagher said. “If these countries can’t even afford to pay back their international debts, they certainly can’t invest in climate resilience, mitigation, and development.”

Debt forgiveness poses a similar challenge to the climate-finance question that COP failed so miserably to address: Solving either crisis would take collective will, and at COP, too few responsible entities were willing. And although COP could agree not to issue new climate finance in the form of debt, a multilateral agreement on debt forgiveness wouldn’t happen at COP, which doesn’t include nonstate actors.

Still, last week in Brazil, President Joe Biden called on G20 countries to swiftly provide debt relief to nations that need it, urging a faster debt-restructuring process. Many analysts say wealthy countries have an obvious interest in preventing default in the developing world: The impact of debt distress is not confined to the distressed country’s borders. Indebtedness breeds austerity, and if countries are unable to shield themselves from the effects of climate change and to transition away from fossil fuels, then that crisis deepens into an issue of global security. Emissions go up, as does displacement. If the world could think differently about debt, perhaps the next round of climate talks, scheduled for November 2025 in Brazil, could go differently too.

Failure to do so is not an option.

When delegates of the world gather in Baku, Azerbaijan, next week for the most important yearly meeting on climate change, their meetings will overlook a reeking lake, polluted by the oil fields on the other side. This city’s first oil reservoir was built on the lake’s shores in the 19th century; now nearly half of Azerbaijan’s GDP and more than 90 percent of its export revenue come from oil and gas. It is, in no uncertain terms, a petrostate.

Last year, too, the UN Conference of Parties (COP) meeting was a parade of oil-state wealth and interests. Held in the United Arab Emirates, the conference included thousands of oil and gas lobbyists; its president was an executive of the UAE’s national oil company. Baku’s COP president, Azerbaijan’s ecology and natural-resources minister, is also an ex-executive of its oil company.

Optimistically, handing influence over this conference to the UAE, and now Azerbaijan—states whose interests are, in many ways, opposed to its aim—means that leaders who depend on fossil fuels must face the costs of burning them. As host this year, Azerbaijan’s job will be to broker an agreement that secures billions—possibly trillions—of dollars from wealthy countries to help along the green transition in poorer countries. Developing nations need these funds to set ambitious climate goals, the next round of which are due in February 2025. A failed COP could set off a chain reaction of failure. The world is gambling that a country that’s shown a bare minimum of commitment to this entire process can keep us all on a path to staving off catastrophic warming.

Baku came to host COP by process of elimination. Hosting duties rotate among regions of the world; this year is Eastern Europe’s turn. Russia nixed the possibility of any European Union country, leaving only Armenia and Azerbaijan standing. Armenia retracted its bid after Azerbaijan agreed to release 32 Armenian service members from prison. (Armenia freed two Azerbaijani soldiers in exchange.)

In many ways, Azerbaijan is an extremely unlikely candidate. Joanna Depledge, a fellow at the University of Cambridge and an expert on international climate negotiations, has followed all 29 years of COP so far, and told me that Azerbaijan has “been pretty much off the radar since the beginning.” The country has hardly ever spoken during previous negotiations, and is not part of any of COP’s major political coalitions, she said. The Paris Agreement requires that, every five years, each country must lay out how it will reduce emissions in a Nationally Determined Contribution plan; Azerbaijan is “one of the very few countries whose second NDC was weaker than the first,” Depledge said. To Steve Pye, an energy-systems professor at University College London, having a petrostate host a climate meeting presents an unambiguous conflict of interest. The country has been clear that it’s looking to ramp up gas exports and has made “no indication” that it wants to move away from fossil-fuel dependency, he told me. That’s an awkward, even bizarre, stance for the entity in charge of facilitating delicate climate diplomacy to hold.

Still, in some ways, Azerbaijan “could be seen as an honest broker” in the finance negotiations, because it is neither a traditional donor country nor a recipient of the funds under negotiation, Depledge said. Azerbaijan, for its part, says it intends to “enable action” to deliver “deep, rapid and sustained emission reductions … while leaving no one behind.”

The whole point of COP is to bring diverse countries together, Depledge said; global climate diplomacy cannot move forward without petrostates on board. Last year’s COP, in Dubai, resulted in the first global agreement to transition away from fossil fuels, and was seen as a modest success. To run COP, Azerbaijan will be forced to reckon with global climate change directly; its team will have to listen to everyone, including the countries most ravaged by climate change today. That’s bound to have an impact, Depledge thinks. Ultimately, Azerbaijan will also need to adapt to a post-oil economy: The World Bank estimates that the country’s oil reserves will dwindle by mid-century. And, since being chosen to host, it has joined a major international pledge to limit methane emissions, as well as announced that its third NDC (unlike its previous one) will be aligned with the Paris Agreement’s goals—although it has yet to unveil the actual plan.  

COP also gives Azerbaijan a chance to burnish its image. After Armenia withdrew its hosting bid, Azerbaijan branded this a “peace COP,” proposing a worldwide cease-fire for the days before, during, and after the meeting. An army of bots have been deployed on X to praise Azerbaijan just ahead of the talks, The Washington Post reported. Ronald Grigor Suny, a professor emeritus of history at the University of Michigan who has written extensively about Azerbaijan, told me that he views the country’s hosting exercise as an elaborate propaganda campaign to sanitize the image of a fundamentally authoritarian and oil-committed nation—a place that last year conducted what many legal and human-rights scholars considered an ethnic-cleansing campaign in one of its Armenian enclaves. “This is a staging of an event to impress people by the normality, the acceptability, the modernity of this little state,” he said. But hope for any peace-related initiatives, including a peace deal with Armenia, is already dwindling. Climate and geopolitical experts have called the whole thing a cynical PR stunt, and Amnesty International reports that the country, which Azerbaijani human-rights defenders estimate holds hundreds of academics and activists in prison, has jailed more of its critics since the COP presidency was announced.

Azerbaijan will still need to broker a real climate deal by the end of the event for it to be declared a success. Failure would be deeply embarrassing and, more pressingly, dangerous for the planet. The world is on track for up to 3.1 degrees Celsius of warming by 2100, and total carbon-dioxide emissions in 2030 will be only 2.6 percent lower than in 2019 if countries’ current NDCs are followed, according to new analysis. Keeping to a 1.5 degree Celsius warming limit would require a lowering of 43 percent over the same time period, which many scientists now say is out of reach. Keeping warming below the far more catastrophic 2 degree limit now will take far faster and more decisive action than the slow COP process has historically produced.

Even if this COP ends in success, Pye, who has worked on the UN Environment Program’s Production Gap Report, notes that, without follow-through, what happens at the conference is merely lip service. Once the spotlight of COP was off it, the UAE, for instance, returned more or less to business as usual; this year, the state oil company increased its production capacity. Then again, the UAE is investing heavily in clean energy, too, following a maximalist approach of more of everything—much like the theory that President Joe Biden has followed in the United States, which recently became the world’s biggest oil producer and gas exporter even as Biden’s domestic policies, most notably the Inflation Reduction Act, have pushed the country toward key climate goals.

Perhaps more than Baku’s leadership, the outcomes of the U.S. election will set the tone for the upcoming COP. News of a second Trump presidency would likely neutralize any hope for a strong climate finance agreement in Baku. In 2016, news of Trump’s election arrived while that year’s COP was under way in Marrakech, to withering effect. America’s functional absence from climate negotiations marred proceedings for four years. Wherever COP is held, American willingness to negotiate in good faith has the power to make or break the climate deals. Put another way, it’s still possible to save the world, if we want to.