The billion-dollar gap | D+C - Development + Cooperation

New rules for carbon emissions trading 

Following some tough internal negotiations, the EU published its NDCs on 5 November 2025 – five days ahead of the UN Climate Conference. European Parliament and Greens parliamentary group member Michael Bloss is critical: at a press conference staged by the Heinrich Böll Foundation, he described the new rules for carbon emissions trading as the “latter-day selling of indulgences” and a “sham”. From 2031, up to five percent of European emissions reductions can come via international carbon credits – a system the MEP claims has proven susceptible to corruption and fraud in the past. 

Financial considerations are also behind the debate on carbon emissions trading: Europe is keen to find inexpensive ways of reaching its climate targets. Bloss fears that Europe will lose its credibility and by extension its leading role in international climate policy. 

Changes in the international system

China could then step into the breach. Regine Schönenberg, who works for the Heinrich Böll Foundation in Rio de Janeiro, says that the image China has in countries of the Global South is good. she adds that as the US increasingly backs out of the multilateral system to combat climate change, some observers are already talking of a “multilateralism of the Global South” – with China at its helm. 

Even this would hardly resolve the funding issue, however. China insists on its status as an “emerging market” and refuses to make any binding financial pledges. In this respect it’s very much akin to other upcoming nations whose economic development in large parts continues to rely heavily on fossil fuels. They are not the only ones to highlight the Global North’s historical responsibility: Henrique Froda from the Brazilian NGO alliance ABONG talks of the principle of “common but differentiated responsibilities”: since European and North American states historically generated the lion’s share of global carbon emissions, they still have a particular financial responsibility despite their contribution now being smaller. 

However, this argument leads to stalemate in practice, Froda goes on. After all, Europeans no longer have the deep pockets they once did. Many states are investing more in defence; some economies are faltering and the “vibe shift” in Western societies is transforming the public debate. The political scope for additional spending threatens to dwindle.