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COP27: Decision to Set up a Fund for Climate Catastrophes, No Other Progress

Besides the decision on loss and damage financing, the world made very little progress on other critical issues

Published
Climate Change
5 min read
COP27: Decision to Set up a Fund for Climate Catastrophes, No Other Progress
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  • Seen as a breakthrough in international climate negotiations, rich countries have finally agreed to establish a fund to pay vulnerable nations for loss and damage due to climate change at the UN climate summit in Egypt

  • Besides the decision on loss and damage financing, the world made very little progress on other critical issues at the annual conference, including a faster phase-down of all fossil fuels, and not just coal

  • The Egypt agreement also failed to make a reference to global greenhouse gas emissions peaking by 2025, which could become a sticky issue at the next climate summit to be held in Dubai

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After resisting it for years, the developed world finally caved in on the issue of loss and damage at the UN climate summit in Egypt, agreeing to the longstanding demand by vulnerable countries to establish a fund to pay for climate disasters that have been brought on by global warming.

All nations attending the annual climate conference decided “to establish new funding arrangements for assisting developing countries that are particularly vulnerable to the adverse effects of climate change in responding to loss and damage.”

After overshooting the Friday deadline, global negotiators, at the crack of dawn on Sunday, November 20, ultimately arrived at a consensus on the Egypt declaration. To be sure, despite the breakthrough on loss and damage, there was virtually no progress on other crucial aspects of action on climate change, particularly on climate finance for mitigation and adaptation and faster phase down of all fossil fuels.

While rich nations have finally agreed to create a fund for loss and damage, COP 27 made very little progress on other important issues such as a faster phase down of fossil fuel.

(Photo by IISD/ENB.)

“A mission 30 years in the making has been accomplished. Our negotiators have endured sleepless nights and endless days in an intense series of negotiations, but after the pain comes the progress,” said Molwyn Joseph of Antigua and Barbuda, chair of the Alliance of Small Island States that stand to lose their island homes to sea level rise.

“This outcome moves us forward,” Simon Stiell, executive secretary of the UN Framework Convention on Climate Change (UNFCCC), said at the conclusion of the two-week-long conference. “We have determined a way forward on a decades-long conversation on funding for loss and damage.”

“I welcome the decision to establish a loss and damage fund and to operationalise it in the coming period,” UN secretary general Antonio Guterres said in a statement at the conclusion of the 27th Conference of Parties (COP27) held in the town of Sharm El Sheikh. “Clearly, this will not be enough, but it is a much-needed political signal to rebuild broken trust.”

India’s environment minister, Bhupender Yadav, in his remarks at COP27, supported establishing a loss and damage fund which he said would benefit all vulnerable countries.

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Rebuilding Trust With Vulnerable Countries

Although many questions remained unanswered on the mechanism of the loss and damage fund, climate experts and activists welcomed the move.

“The creation of a loss and damage fund signals that it is now impossible for countries to claim an ethical climate stance without supporting this agenda,” said Navroz K. Dubash, a professor at the Centre for Policy Research, a think tank based in New Delhi, to media. “This is a tectonic normative shift.”

“With the creation of a new loss and damage fund, COP27 has sent a warning shot to polluters that they can no longer go scot-free with their climate destruction,” said Harjeet Singh, head of global political strategy at Climate Action Network International, a coalition of over 1,300 environmental NGOs in a press release.

The new fund will provide a lifeline to the poor whose homes are destroyed, farmers whose harvests are ruined, and islanders who are forced from their ancestral homes, according to a statement by Ani Dasgupta, President and CEO of Washington D.C.-based environmental think tank World Resources Institute. “This positive outcome from COP27 is an important step toward rebuilding trust with vulnerable countries,” Dasgupta said.

The details of the fund, however, need to be worked out. There will now be backroom haggling over how the loss and damage fund will work and how the money will flow into it from wealthy nations. The summit decision is analogous to saying that nations have decided to open a bank account, but there are no assurances yet that rich countries will deposit money into it.

Despite the progress on loss and damage, the Sharm el-Sheikh summit failed to call for a phase-down of all fossil fuels, not just coal. The position remains the same, as stated in the 2021 Glasgow climate pact. Raised as a diplomatic offensive, India received support from many countries, especially the European Union, for its call for an all-inclusive phase-down of fossil fuels. This could have put the spotlight on oil and gas-producing nations, and not just countries like India and China that rely overly on coal.

Experts said this failure could threaten gains made on loss and damage, as unabated use of fossil fuels will hasten the climate emergency that will further aggravate loss and damage.

A senior policy advisor at the International Institute of Sustainable Development, Shruti Sharma said that there was hope that all fossil fuels- coal, oil, and gas- would get included in a phase-down call as India has proposed. The failure of COP27 to strengthen the COP26 statement (on the phase-down of coal) is unfortunate, she added.

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Drastic Emission Cuts Required

It is now established that steep emission cuts are needed to get on track with Paris Agreement goals and keep the 1.5 degrees Celsius temperature limit within reach. The climate statement from Egypt, which called for low-carbon development, implying that there is no international prohibition on increasing the use of natural gas.

“We face a serious reckoning on 1.5 degrees Celsius. Not enough cuts in the North (developed world), not enough money to accelerate and understandable unwillingness to compromise development in the South (developing countries),” Dubash said. “Something has to give, and it might be 1.5 degrees.”

Vehicular traffic in Bengaluru. Steep emission cuts are necessary to stay on track with Paris Agreement goals and keep the 1.5 °C temperature limit within reach.

(Photo by Diptiprakashpalai/Wikimedia Commons.)

COP27 also failed to address other crucial topics, including the global objective for adaptation, the new collective quantified aim on climate finance, and mitigation-related ambitions.

Although emissions growth seems to be slowing, it is not enough to halt the pace of climate change, experts said. The planet is still on a path to a mean global temperature rise of almost 3 degrees by the end of the 21st century, according to the Intergovernmental Panel on Climate Change, the world’s largest body of climate experts.

The cost of inaction is far greater than climate action, said Stiell of UNFCCC. “Global emissions need to start a downward trajectory by 2025,” he said. The Egypt summit chose to remain silent on the issue, merely reiterating that it stands behind the goal of limiting warming to 1.5 °C without specifying any action. Amid the gloom and doom, there was some good news, but outside the summit. At a meeting of leaders of the G20 group of nations in Indonesia, the U.S. and China, the world’s two biggest emitters, agreed to resume discussions on climate change, which were suspended earlier this year. There has also been some more progress on energy transition in recent weeks, if not at the UN climate summit. Despite its shortcomings, COP27 managed to somewhat redeem itself by choosing to create a loss and damage fund. In order to ensure the new fund gets fully functioning and assists the most vulnerable individuals and communities bearing the brunt of the climate crisis, countries must now collaborate, Singh summed up.

(At The Quint, we are answerable only to our audience. Play an active role in shaping our journalism by becoming a member. Because the truth is worth it.)

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Topics:  Climate Change   Cop27 Summit 2022   COP27 

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