Caribbean Trade Law and Development

Tag: climate finance

  • Barbados’ Debt-for-Climate Resilience Swap: A Blueprint for Sustainable Development

    Barbados’ Debt-for-Climate Resilience Swap: A Blueprint for Sustainable Development

    Ainsley Brown (Guest contributor)

    Barbados has once again positioned itself as a global trailblazer, completing what it calls the world’s first debt-for-climate resilience swap, a groundbreaking financial arrangement that frees up USD$165 million for critical investments in water infrastructure, food security, and environmental protection. This bold move not only addresses urgent climate adaptation needs but also underscores Barbados’ commitment to sustainable development and ESG (Environment, Social, and Governance) principles.

    This initiative is a watershed moment for small island developing states (SIDS) and other climate-vulnerable nations facing the triple crises of high debt, climate change, and biodiversity loss. But what does this deal mean in the broader context of global sustainability, and can it serve as a template for other countries grappling with similar challenges?

    What Is a Debt-for-Climate Resilience Swap?

    In essence, a debt-for-climate resilience swap involves a country negotiating with its creditors to restructure or reduce its sovereign debt in exchange for commitments to invest in climate resilience or biodiversity conservation. In Barbados’ case, the funds will be channeled into:

    • Water infrastructure projects: Including the construction of a new South Coast Water Reclamation and Reuse Facility to more than double water availability by 2050.
    • Environmental protection: Investments in mangrove conservation and water restoration.
    • Agricultural resilience: Enhancing food security amidst rising climate pressures.

    This model allows governments to reallocate resources from debt servicing to vital climate adaptation measures. For creditors, it’s an opportunity to support global public goods like biodiversity conservation while safeguarding their financial interests.

    Why Debt Swaps Matter for SIDS and Climate-Vulnerable Countries

    Barbados’ Prime Minister Mia Mottley aptly describes this transaction as a model for other vulnerable states. Small island nations like Barbados are the “canaries in the coal mine” of climate change, grappling with rising sea levels, more frequent hurricanes, and dwindling freshwater resources.

    Water Scarcity in Barbados

    Barbados is one of the most water-scarce nations in the world. Climate change exacerbates this scarcity, threatening not just daily life but also economic activities like agriculture. The New South Coast Water Facility, financed through the swap, aims to alleviate these challenges by increasing water availability and reducing pollution in the Caribbean.

    The Debt Crisis

    Debt burdens severely limit the ability of developing nations to invest in climate resilience. According to the UN Conference on Trade and Development (UNCTAD), global sovereign debt reached a staggering USD$92 trillion in 2022. More than 50 of the poorest countries are on the brink of default, with some spending more on interest payments than on health or education.

    Barbados’ debt restructuring initiative is part of a broader effort to reduce its debt-to-GDP ratio from 105% to 60% by 2036.

    Global Examples and Lessons Learned

    Barbados is not alone in leveraging debt swaps to address climate challenges:

    • Belize: A 2021 debt-for-nature deal reduced its debt by 12% of GDP and unlocked USD$180 million in long-term conservation funding, helping protect the Western Hemisphere’s longest coral reef.
    • Ecuador: Converted USD$1.6 billion of debt into USD$12 million annually for Galápagos Islands conservation, under the world’s largest debt-for-nature deal.
    • Seychelles: Pioneered marine debt-for-nature swaps, safeguarding its ocean territory while alleviating fiscal pressures.

    These examples illustrate how debt swaps can provide fiscal relief, protect biodiversity, and attract new actors and financing mechanisms into the climate action space.

    The Bridgetown Initiative: Reimagining Global Finance

    Barbados’ efforts are closely tied to the Bridgetown Initiative, a global movement led by Prime Minister Mottley to reform the international financial architecture. Key proposals include:

    1. Redefining loan terms: Preventing nations from spiraling into debt crises after climate disasters.
    2. Mobilizing USD$1 trillion for climate resilience: Through development banks and discounted lending for vulnerable countries.
    3. Establishing a global reconstruction mechanism: Backed by private-sector investment to fund post-disaster recovery.

    The initiative recognizes that the current financial system, designed in a post-World War II era, is ill-equipped to address today’s challenges, including systemic inequality and climate change.

    Challenges and Limitations of Debt Swaps

    Despite their promise, debt-for-nature and debt-for-climate swaps are not panaceas. Critics highlight several challenges, which include:

    • Limited scale: While impactful, the financial relief from debt swaps is often small relative to the scale of global adaptation needs, estimated at USD$359 billion annually by the United Nations.
    • Complexity: These transactions require extensive negotiations, partnerships, and upfront financing, which can deter broader adoption.
    • Dependency on grants and private investment: Debt swaps cannot replace the need for concessional financing, grants, or private sector participation.

    A recent IMF report underscores that while debt swaps are valuable, they must complement—not replace—comprehensive debt restructuring and other financial tools.

    A Blueprint for the Future?

    Barbados’ leadership sets an example of how innovative finance can align debt management with sustainable development goals. The country’s latest debt swap, bolstered by guarantees from institutions like the European Investment Bank and Inter-American Development Bank, illustrates the power of partnerships. This approach also offers co-benefits, such as potential credit rating upgrades, as seen in Belize, which can lower borrowing costs and unlock further investment opportunities. For countries in the Global South, debt swaps could:

    • Enhance fiscal space: Freeing up resources for health, education, and climate action.
    • Attract international support: By demonstrating strong commitments to ESG principles.
    • Foster resilience: By addressing both immediate adaptation needs and long-term sustainability.

    Conclusion

    Barbados’ debt-for-climate resilience swap is not just a financial transaction; it’s a bold declaration that climate action and fiscal responsibility can—and must—go hand in hand. As more countries explore similar arrangements, the potential for scaling up global climate finance becomes evident. However, achieving transformative change requires systemic reform, including:

    1. Expanding access to concessional financing for vulnerable nations.
    1. Enhancing the efficiency and scope of global financial institutions.
    2. Prioritizing sustainable development in creditor-debtor negotiations.

    Barbados has provided a roadmap for others to follow. The question is no longer whether debt swaps are feasible but how quickly and effectively they can be scaled to meet the global challenges of our time. As Prime Minister Mottley aptly said, this is not just about Barbados—it’s about creating a future where “people and the planet” take precedence over profit and debt burdens. Let this serve as a call to action for governments, financial institutions, and global citizens to rally behind innovative solutions for a more sustainable world.

    By pioneering this debt-for-climate resilience swap, Barbados has turned an economic challenge into an opportunity for leadership. The world would do well to take notice—and to act.

    Ainsley Brown is a global expert in economic development and special economic zones, passionate about aligning finance with climate action to create resilient futures.

  • COP25 climate talks: What’s at stake?

    COP25 climate talks: What’s at stake?

    Alicia Nicholls

    Caribbean representatives will shortly join their international counterparts in Madrid, Spain, from December 2-13, 2019 for the 25th meeting of the Conference of the Parties – the decision making body of the United Nations Framework Convention on Climate Change (UNFCCC).

    Climate change is the greatest threat facing the planet, and for many low-lying small island developing States (SIDS), coastal cities and communities, it is an existential one.  In recognition of the climate crisis, leaders from over 190 countries signed the historic Paris Climate Change Agreement in 2015 at the end of COP21 in Paris. Inter alia, they agreed to the ambitious but important goal of keeping global average temperature increases to well below 2 degrees Celsius above pre-industrial levels and to pursue efforts towards a 1.5 degrees Celsius ceiling.

    To achieve this goal, the Agreement’s framers recognised that the world needed to reach global peaking of greenhouse gas (GHG) emissions as soon as possible.  However, with emissions still rising, countries’ levels of climate action and ambition remain too feeble to address the severity of the climate crisis. A significant increase in both at COP25 will be needed if the world is to avert the impending climate disaster.   

    World climate action/ambition still off-track

    The just released United Nations Environment Programme (UNEP) Emissions Gap Report 2019 showed that GHG emissions “continue on an upward trajectory and reached a record high of 55.3 GtCO2e in 2018”. The report found that G20 members, which account for 78 per cent of global GHG emissions, are collectively “on track to meet their limited 2020 Cancun Pledges”.  But, it noted that “seven countries are currently not on track to meet 2030 NDC commitments, and for a further three, it is not possible to say”. The report concluded that greater action by G20 members “will be essential for the global mitigation effort”.

    Making reference to the “large” emissions gap, the Emissions Gap Report further indicated that “in 2030, annual emissions need to be 15 GtCO2e lower than current unconditional Nationally Determined Contributions (NDCs) imply for the 2°C goal, and 32 GtCO2e lower for the 1.5°C goal”. This means the level of ambition in countries’ NDCs – their national commitments for reducing emissions and pursuing adaptation – remains too low to meet the Paris goal. As such, countries will need to agree to deeper emissions cuts in a shorter time frame.

    What will be discussed at COP25?  

    Even in its planning stages, COP25 has already faced and overcome two potential ‘crises’. Firstly, Chile assumed COP25 chairmanship after Brazil reneged on its offer to chair the event, shortly following the election of then incoming President Jair Bolsonaro. Secondly, weeks leading up to the event, Spain stepped in as the host nation after mass civil unrest caused the Chilean government to abandon hosting both the COP25 and an APEC trade summit. As such, the event will be chaired by Chile but held in Madrid. The President-designate of COP25 will be Her Excellency Carolina Schmidt of Chile.

    At COP24 in Poland last year, parties completed the majority of the implementation rules and guidelines of the Paris Agreement – the so called ‘Rulebook”. At COP25, they will continue deliberations to allow for the Agreement’s full operationalization. Key on the agenda to be resolved is establishing rules for implementing Article 6 of the Paris Agreement which pertains to market-based tools for limiting GHGs, such as international carbon markets.  Due to the sensitivity of this issue, the parties were unable to agree on ‘Article 6 rules’ at the COP24 and deferred the issue to COP25.

    Developing countries will, in particular, be concerned about climate finance critically needed for their mitigation and adaptation efforts. The parties at COP25 will also review the Warsaw International Mechanism for Loss and Damage associated with Climate Change Impacts.   

    Importantly, a goal of COP25 will be ramping up global climate ambition in advance of 2020 – when countries have committed to submitting their revised NDCs and their long-term low GHG emissions development strategies.

    On this note, it would not be lost on participants that the US, the highest producer of GHG emissions on a per capita basis, has formally withdrawn from the Paris Agreement. While the US’ withdrawal will not take effect until November 2020, the Trump Administration has in the interim been reversing environmental regulations, including those enacted under the former Obama Administration.

    To date, the US is the only country to have withdrawn from the Paris Agreement. Other major emitters such as China (the world’s largest producer of GHG emissions on an absolute basis), the EU and India have not followed suit. Indeed, incoming president of the EU executive Commission, Ursula von der Leyen, plans to make the EU “the world’s first climate-neutral continent” by 2050 and has promoted a European Green Deal.

    Although the Trump administration has been reversing federal level environmental regulations, several US states, cities and businesses have maintained their commitment to climate action under America’s Pledge Initiative. According to the America’s Pledge Initiative, these represent “65% of the US population and 68% of the economy”. While this is some comfort, the potential absence of the world’s second largest emitter from the Agreement is a political setback for ratcheting up climate action at a time when the stakes are ever higher.

    Stakes remain high

    The Intergovernmental Panel on Climate Change (IPCC) Special Report on Global Warming of 1.5°C published in 2018 found that human activity has already caused the earth to warm by 1 degree Celsius. Though a point five degree difference may sound negligible, the IPCC report found that even a 2 degree Celsius increase in warming could cause catastrophic impacts. The IPCC also more recently published two other special reports highlighting the real impact of climate change on land, and on the ocean and cryosphere.

    There has been a noticeable increase in the number of climate-related events and disasters internationally, be it droughts, flooding, record wild fires or faster than expected melting of the polar ice caps. These events have affected several countries around the world. But, it must be emphasized, while SIDS contribute the least to climate change (together accounting for less than 1% of global emissions), they are among the most negatively affected by the adverse impacts of climate change. Indeed, rising sea levels are already negatively affecting our fragile coastlines.

    The recent IDB assessment on the effects and impact of Hurricane Dorian in the Bahamas estimated damages at $2.5 billion, and losses at $717.3 million, with most of the damage confined to the Abaco Islands and to a lesser extent, Grand Bahama. According to the IDB report, there were 67 confirmed deaths and 282 missing persons as of 18 October 2019. This is by no means an isolated incident. As sea surface temperatures increase, scientists predict more intense hurricanes.  

    Climate change has already caused shifts in weather patterns with implications for food security and access to water. Besides the human impact, it also threatens the tourism, manufacturing and agriculture industries, which are the economic building blocks, to varying extents, of most of our Caribbean economies.   

    Debate in silos

    On another note, the debate on climate change and trade is still to a large extent occurring in silos. The Paris Agreement does not touch on trade, which is not only a contributor to climate change, but can and has been impacted by climate change. Similarly, trade officials are not among the negotiators at climate talks.

    However, the World Trade Organisation, the global regulator of international trade, has since April 2018 hosted three Natural Disasters and Trade symposia, and will on November 29 host its fourth. With financing from the Permanent Mission of Australia to Geneva, three research studies focused on the macro-economic impacts on disaster-affected countries and the trade issues arising in the disaster response, recovery and resilience-building. The country studies were Nepal, the Caribbean (Dominica and St. Lucia) and The Pacific (Fiji, Tonga and Vanuatu).

    Barbados’ co-hosting of the UNCTAD XV quadrennial conference in October next year is the perfect opportunity to keep climate action high on the trade and development agenda and to bring these two disciplines together.

    In conclusion

    Nearly four years after world leaders gathered at COP21 and negotiated and signed the historic Paris Agreement, levels of climate action and ambition do not match the severity of the impending climate crisis. Certainly, governments, businesses, households, and individuals all have their role to play in reducing their emissions footprint. But it is imperative for governments to set the policy tenor by enacting environmental legislation, and creating an enabling environment for the adoption of renewable energy and climate-friendly practices, products and services. With COP25 a mere week away, what the world needs right now is urgent and coordinated action to step up mitigation and adaptation efforts and accelerate the shift to a climate-friendly and resilient future.

    Alicia Nicholls, B.Sc., M.Sc., LL.B., is an international trade and development consultant with a keen interest in sustainable development, international law and trade. You can also read more of her commentaries and follow her on Twitter @LicyLaw.

    DISCLAIMER: All views expressed herein are her personal views and do not necessarily reflect the views of any institution or entity with which she may be affiliated from time to time.

  • COP21 Paris Agreement: A Partial but Important Victory for SIDS and the World but just the beginning

    Alicia Nicholls

    Some two decades in the making, delegates from 196 countries around the world made history today by voting to adopt the Paris Agreement to the United Nations Framework Convention on Climate Change (UNFCCC), an internationally binding framework for the post-2015 global climate agenda.

    Getting ten people in a room to agree on something is a challenge in itself, far less getting delegates from almost 200 countries with different interests, perspectives and levels of development to agree on an international strategy for tackling climate change. Going into the COP21 there was broad international consensus on the closing window for reversing the deadly course towards unsustainable high levels of global temperature increase and general recognition that while small island developing states (SIDS) contributed little to the problem of climate change, they are the ones which are already suffering the most devastating effects of climate change. However, drilling down into the key issues there were thorny areas of divergence which led to several compromises in the final text.

    My personal view, which I will argue in this article, is that while the Paris Agreement is by no means perfect, the fact that parties were able to actually achieve an agreement and its inclusion of many of the concerns which SIDS have advocated for even in compromise form in some cases, makes it a partial but important  first step for tackling what has been recognised as one of the greatest threats to our sustainable future.

    Long Term Temperature Increase Target of 1.5 degrees Celsius

    A major victory and negotiating point for SIDS through its campaign “1.5 to stay alive” was for commitment by parties to hold the increase in global average temperature to no more than 1.5 degrees Celsius above pre-industrial levels. In support of its negotiating position, SIDS relied on the Structured Expert Dialogue on the 2013-2015 Review of the long term global temperature goal which argued that the global consensus of limiting the increase in average global temperatures to 2 degrees Celsius was inadequate and would threaten the sustainability of both SIDS and low-lying coastal States. This was a sticking point in the negotiations. In the end at article 2(1)(a) the Paris Agreement parties agreed to a compromise position which aims to hold the increase in the global average temperature to well below 2 °C above pre-industrial levels and to pursue efforts to limit the temperature increase to 1.5 °C above pre-industrial levels. While this is not entirely what SIDS were hoping for it is a lot more ambitious than what most had expected.

    Recognition of Loss and Damage

    Another major issue for SIDS was for the agreement to establish an international mechanism to address loss and damage which is treated separately from adaptation. They relied again on the findings of the Structured Expert Dialogue on the 2013-2015 Review which showed that even in low emission scenarios SIDS will still experience substantial loss and damage. As such they argued for recognition by industrialised States of liability and compensation. The worst greenhouse gas emitters US, China and the EU countries were absolutely against any form of compensation or liability.

    Article 8 of the Paris Agreement is a mixed victory for SIDS in that parties recognize the importance of “averting, minimizing and addressing loss and damage associated with the adverse effects of climate change”. The Warsaw International Mechanism for Loss and Damage, established at COP19 in 2013, will be one of the mechanisms for facilitation and cooperation and may be enhanced or strengthened as determined by the Parties represents a compromise on the issue of loss and damage. However, in paragraph 52 of the preamble it includes that Article 8 “does not involve or provide a basis for any liability or compensation”. This is likely a compromise for those countries which opposed inclusion of any liability or compensation. While this is a weakness, it is likely this will not be the end of this issue and that SIDS will continue to push for this in the reviews.

    Climate Finance

    Even though developed States pledged to mobilise USD 100 billion dollars a year in financing for climate change, SIDS have continuously argued about the limited financial resources which have actually been made available to assist in their mitigation of, and adaptation to, climate change. In Article 9, developed country Parties agreed to scale up efforts to provide financial resources to assist developing country Parties with respect to both mitigation and adaptation and should continue to take the lead in mobilizing climate finance from a wide variety of sources, instruments and channels. Other Parties are encouraged to provide or continue to provide such support voluntarily. Developed countries are to report on support on a biennial basis. Other Parties  are to do so voluntarily. The Financial Mechanism of the Convention is to serve as the financial mechanism for the Paris Agreement.

    In paragraph 115 of the preamble, developed country Parties are to scale up their level of financial support with a goal of USD 100 billion annually by 2020 for mitigation and adaptation. Interestingly, this bit about the USD100 billion is included in the preamble to the Agreement and not as a binding provision within the text itself which has an impact on its enforceability. A stronger more robust provision would have been desired.

    Technology Transfer and Capacity-building support

    SIDS were insistent on the inclusion of adequate provisions for adaptation to assist them in their adaptation to climate change, including provisions on technology transfer and capacity-building support. Technology transfer is referenced both in the preamble and the actual text of the Paris Agreement. Article 10 of the Agreement requires parties to strengthen cooperative action on technology development and transfer. A Technology Mechanism and Technology Framework have been established under the Agreement to facilitate this, although the text does not detail how this technology transfer is to occur. Support, including financial support, is to be provided to developing country Parties for implementation. Article 11 of the Agreement itself does not speak to how capacity building is to take place but leaves it up the Conference of the Parties serving as the meeting of the Parties to the Paris Agreement to consider and adopt a decision on the initial institutional arrangements for capacity-building at its first session. It will be up to SIDS to keep pushing for further support for technology transfer and capacity-building support.

    Voluntary Greenhouse Gas Emission Reductions

    Though the parties recognise in the preamble that deep reductions in global emissions will be required in order to achieve the ultimate objective of the Convention and Article 4(4) of the main text requires developed country Parties to continue taking the lead by undertaking economy-wide absolute emission reduction targets, generally speaking the provisions on greenhouse gas emission reductions are voluntary, vague and crafted mostly in best endeavour language and not in the robust language climate activists and SIDS were hoping for.

    Under Article 4(1) parties are to aim to reach global peaking of greenhouse gas emissions “as soon as possible”. Each Party is to prepare, communicate and maintain successive nationally determined contributions that it intends to achieve (Article 4(2)), with the further conditions that there should be progression in each of its contributions and that they should reflect its highest possible ambition. These are to take into consideration each country’s national circumstances and on the principle of differentiated responsibilities.

    A mechanism to contribute to the mitigation of greenhouse gas emissions and support sustainable development has been established under the authority and guidance of the Conference of the Parties. However, it is unclear how this is to work. One positive point though is that a share of the proceeds from activities under the mechanism are to be used to cover administrative expenses and to assist developing country parties that are particularly vulnerable to the adverse effects of climate change to meet the costs of adaptation. Again, however, the specifics on how this will be done will have to be subsequently fleshed out.

    Stocktaking/Five Year Reviews

    SIDS were adamant that any agreement should include provisions for five-year review cycles of greenhouse gas emissions targets to assess the collective progress towards achieving the long term goal of a 1.5 degrees Celsius target with the first review to take place before 2020. The Conference of the Parties serving as the meeting of the Parties to the Paris Agreement agreed to five year reviews after 2023, but with inclusion of “unless otherwise decided”. Additionally, unlike the “before 2020” recommendation made, the parties agreed to a first global stocktake in 2023. Here again the Paris Agreement features a compromise but is a major win for small states as it allows for periodic reviews so adjustments can be made to ensure the goal of 1.5 degrees is reached.

    Legally Binding

    Much ado has been made about whether it would be a legally binding Agreement. This discussion was quite moot as Article 2(1)(a) of the Vienna Convention on the Law of Treaties defines a treaty as “an international agreement concluded between States in written form and governed by international law, whether embodied in a single instrument or in two or more related instruments and whatever its particular designation”, while Article 26 further provides that “every treaty in force is binding upon the parties to it and must be performed by them in good faith”. For domestic ratification reasons, the US position however is that it is not a treaty. Because of the concept of separation of powers, a treaty would require Congressional approval which, given the current composition of the US Congress and the strong oil and coal lobbies, is unlikely to receive congressional approval.

    Transparency

    Article 13 of the Paris Agreement establishes an “enhanced transparency framework for action and support with built-in flexibility which takes into account Parties’ different capacities”. The Transparency Framework established under the Agreement is to build on the transparency arrangements already established under the UNFCCC Convention and there is to be frameworks for transparency to action and transparency of support.Parties are to regularly provide information a national inventory report of anthropogenic emissions by sources and removals by sinks of greenhouse gases and information necessary to track progress made in implementing and achieving their nationally determined contribution under Article 4. However, it does not state how often is “regularly”. There are also reporting obligations in regards to financing and technology provided and received.

    The technical expert review provided for under Article 13 is to consist of a consideration of the Party’s support (as relevant), its implementation and achievement of its nationally determined contribution, identification of areas of improvement for the Party, and include a review of the consistency of the information with the modalities, procedures and guidelines referred to in paragraph 13 of the Article. The review is to pay particular attention to the respective national capabilities and circumstances of developing country Parties.

    Compliance and Enforcement

    The key issue is not whether it is a legally binding agreement but its enforcement of compliance. The greatest weakness of the Agreement is that many of its major provisions are drafted in hortatory ‘best endeavour” language as well as its enforceability and policing given its weak compliance mechanism. Article 14 establishes an expert-committee based mechanism to facilitate implementation of the agreement and compliance with its provisions. However, the fact that it is to be facilitative and “non-punitive” means it is not envisaged to be an enforcement mechanism which actually has “teeth” and would probably be little more than a “name and shame” mechanism. The actual modalities and procedures of this committee are to be decided by the Conference of the Parties meeting as the Parties to the Paris Agreement when they have their first session.

    Just the Beginning

    In light of the many compromises and vague language in many of provisions, the Agreement is by no means a perfect one and aspirational rather than binding in many of its key provisions. It is, however, a lot better than what it would have been had it not been for the strong defence by SIDS, through the Alliance of Small Island States (AOSIS), of their interests. In light of previous failures and two decades of often challenging climate change negotiations, the fact that we finally have an agreement, which though not perfect, balances interests in a way that is fair and incorporates most of SIDS concerns, is an important victory for SIDS and the world. It recognises the principle of differentiated responsibility and makes some mention of the special vulnerability of SIDS in various provisions. Another positive aspect is that Article 27 provides that no reservations may be made to the Agreement.

    The Paris Agreement represents a turning point towards a new post-2015 global plan for climate change adaptation and mitigation. The real test will be in its ratification and implementation. Pursuant to Article 21, at least 55 Parties to the Convention accounting in total for at least an estimated 55 percent of the total global greenhouse gas emissions, have to ratify the Agreement for it to come into force. The US will be a critical case to watch as if it is seen as a Treaty, which it indeed is, Congressional approval will be needed and such approval appears unlikely. No one wants a repeat of the Kyoto debacle.

    There is scepticism about whether the “1.5 degrees Celsius” target can actually be reached. Indeed, the INDC Synthesis report released by the UNFCCC Secretariat and which captured the overall impact of national climate plans covering 146 countries as of 1 October 2015, showed that the current INDCs have the capability of limiting the forecast temperature rise to only around 2.7 degrees Celsius by 2100, which still does not support the 2 or 1.5 targets. The review mechanism provides the opportunity to review national climate plans to bring them into this target. SIDS will need to continue their advocacy and use the review mechanisms provided for under the Agreement to continue to hold major emitters to account.

    While it is easy to bask in the euphoria of this historic agreement, the world cannot take this moment for granted by resting on its laurels. Now the real work on a low carbon economy begins.

    Alicia Nicholls, B.Sc., M.Sc., LL.B. is a trade and development consultant with a keen interest in sustainable development, international law and trade. You can also read more of her commentaries and follow her on Twitter @LicyLaw.