‘Loss and damage’ fund at Climate summit holds out real hope
The big takeaway from the international climate talks at Sharm el-Sheikh, Egypt COP27 was the agreement to set up a ‘loss and damage’ fund to help rebuild communities devastated by floods and climate change. This demand, which emerged last year at the climate summit in Glasgow, has been driven by poor nations, especially those with island and coastal communities threatened by floods and submergence. Barbados PM Mia Mottley and others have underlined that the rampant industrialisation of the rich, developed world has contributed the most to global warming; therefore, these nations must now pay for repairing the damage. This is a big step forward as the US and the European Union have long resisted any compensation that will be seen as ‘reparation’ for their unchecked development.
The final text does not seem to provide details on how the fund will be raised and disbursed. But it is a foot in the door. The principle of the polluter paying for climate damage has been initialled, and without doubt, the next round in Doha will give concrete character to the fund. On the other hand, the big disappointment for the developed nations was the failure to reach specific commitments to phasing out fossil fuels. While the general understanding remains that fossil fuels—oil, gas and coal—are primarily responsible for greenhouse emissions and global warming, resistance from China and Saudi Arabia, among others, blocked any time-bound commitments. The energy crisis caused by the Ukraine war has also changed the agenda.
Environment scientists have emphasised that global warming must peak by 2025 if we are to restrict the rise in temperatures to 1.5°C. The delay in phasing out fossil fuels will impact this adversely. Notwithstanding the setback, overall, it was a victory for Nature and for thousands of Pakistani farmers who lost everything to the recent floods, the ‘loss and damage’ fund holds out hopes for real compensation. So far, it has been crumbs: the European Union, for instance, pledged $126 million to a country that saw $40 billion worth of devastation. On the sidelines, there was an agreement to pay Indonesia $20 billion to help it transition from coal. Simultaneously, Brazil’s President-elect Luiz Lula da Silva promised at COP27 that he would end deforestation and restore the Amazon. These are real victories which lay the foundation for arresting climate change.