The deal in Cancún falls short of the comprehensive agreement that is the goal of UN climate talks, but it was nevertheless greeted by many governments as a milestone.
The deal, most agreed, helped to build trust between rich and poor countries and gave the troubled bilateral process a new lease of life.
The Mexican hosts of the conference were treated to a standing ovation for managing to put together a compromise text which was acceptable to all countries except Bolivia.
The agreement largely transcribes the Copenhagen Accord, adopted by some 140 countries after the December 2009 summit in the Danish capital, into a UN document. It officially recognises that the goal should be to halt global climate change to 2°C.
The text lists the emissions reduction pledges made so far and officially recognises them as part of the UN process.
No progress was made on agreeing higher targets that would be in line with what science requires, but the text urges developed countries to raise their ambitions in order to reduce their emissions by 25%-40% below 1990 levels by 2020.
The debate about what year to choose as the reference for emission reductions was put to rest as countries agreed to keep 1990 as the base year after 2012, when the Kyoto Protocol expires. But countries will also be allowed to state their targets as a percentage of another chosen year.
Green Fund and technology transfer
The parties also decided to set up a Green Fund to deliver $100 billion per year by 2020 to help poor countries fight climate change and adapt to its inevitable consequences. The fund will be governed by a board of 24 members, on which developed and developing countries will be equally represented.
In addition, a Technology Mechanism was established to help developing countries deploy technologies to cut emissions and adapt to climate change.
The talks also established an Adaptation Framework. A new Adaptation Committee was set up to help developing countries implement measures to deal with the effects of climate change.
In addition, some parameters for the process of boosting forest protection in developing countries were agreed. The text requests developing countries to draw up national strategies for forests and monitoring systems with funding and technology support from developed countries. Market mechanisms, however, were not addressed at this point.
However, some of the biggest battles, including the fate of the Kyoto Protocol, remain uncertain. Negotiators could not forge a consensus over a second commitment period for the Kyoto Protocol. Canada, Japan and Russia said they would not sign up to a continuation of Kyoto, which does not commit the US or large emerging economies like China and India to reducing their emissions.
Talks on the legal form of a post-Kyoto climate treaty will resume at the next UN climate summit in South Africa in December.