Push to top COP27 agenda with thorny compensation talks

Compensation for irreversible climate impacts should lead negotiations at this year’s UN climate summit, say advocates.

In the months following last year’s United Nations climate conference, developing countries have been hit by waves of extreme weather – floods, fires and drought have killed thousands, displaced millions and caused untold damage to food systems and economies.

The communities bearing the brunt of this climate chaos are least responsible for the emissions that are driving up global temperatures. And they say it is time that wealthy countries take responsibility.

Loss and damage – the irreversible harm caused by climate change, which cannot be adapted to or mitigated against – gained focus at Glasgow’s COP26 like never before. Leaders of least-developed and small island states are determined to continue their push for compensation at this year’s COP27.

“The time is well overdue to address the massive loss and damage from climate change suffered by people who did the least to cause it.”

Sameh Shoukry, Egypt’s foreign minister and COP27 president

“Developing and vulnerable countries are being pushed into deeper and deeper crises by food security, energy poverty, and the debt crisis, which are all underpinned by the colonial extractive legacy,” Sindra Sharma, global policy lead at Climate Action Network (CAN), tells SciDev.Net.

More than 400 non-government organisations signed an open letter from CAN – a network of 1,500 organisations in 130 countries – that calls on governments to put loss and damage finance on the agenda at COP27.

Loss and damage is on the provisional agenda, but advocates remain worried that world leaders will find new ways to prevent agreement on financial support for low- and middle-income countries on the climate frontlines. Wealthy countries blocked a proposal at COP26 for a loss and damage financing body, opting instead for a new “dialogue” to continue funding discussions, as they seek to avoid legal liability for historic emissions and related compensation claims.

Climate damage

The World Bank has estimated that Pakistan will need US$40 billion to recover from this year’s devastating floods, which displaced one third of the country’s population. The national poverty rate could increase by up to four percentage points, pushing between six and nine million people into poverty.

Between 2019 and 2020, around 90 per cent of climate finance went towards mitigation – typically used by rich countries to develop greener technologies – while just over 7 per cent went on adaptation – more frequently used by poorer nations to find ways to live with the changing climate, according to research by the Climate Policy Initiative, a non-profit analysis and advisory organisation.

Researchers from the Basque Centre for Climate Change, a non-profit research organisation attached to the University of the Basque Country, have estimated that developing countries will need up to US$580 billion a year by 2030 to cover the costs of loss and damage.

Zoha Shawoo, an associate scientist at the international non-profit Stockholm Environment Institute, told SciDev.Net that climate finance had major gaps, making it ineffective and unjust.

“To be in line with climate justice principles, finance for loss and damage needs to be made in a way that puts the needs of vulnerable and marginalised communities at the centre and gives them a lot of freedom and decision-making power over how the money is used to meet their needs,” Shawoo says.

The Alliance of Small Island Developing States has long advocated for a dedicated intergovernmental fund to help vulnerable countries recover from extreme climate disasters and long-term threats. Finance should be provided in the form of grants – rather than loans that will increase the debt burden of developing countries – and come in addition to any Official Development Assistance, emergency aid, or existing commitments to climate mitigation and adaptation finance, the CAN open letter adds.

Country pledges

Denmark’s government has pledged more than US$13 million to help developing countries cope with loss and damage, the country’s development minister Flemming Møller Mortensen announced on the sidelines of the UN General Assembly in September.

At COP26, the Scottish government also pledged around US$2.6 million to address loss and damage, with a similar pledge from the Belgian region of Wallonia.

Saleemul Huq, director of the International Centre for Climate Change and Development (ICCCAD), an environmental research institute, expects more countries to follow suit this year.

Egypt’s foreign minister and COP27 president, Sameh Shoukry, has said in a blog post that while loss and damage financing is “contentious”, a credible global climate agenda cannot be achieved without it.

“The time is well overdue to address the massive loss and damage from climate change suffered by people who did the least to cause it,” Shoukry wrote in the blog post published on 14 October.

Chile’s environment minister Maisa Rojas and Germany’s climate special envoy Jennifer Morgan have been tasked by Egypt with finding a way to include loss and damage on the summit’s official agenda.

Huq says that developing countries’ expectations will be high for Egypt’s leadership.

“As the incoming president of COP27, Egypt has a great role to play in ensuring a successful outcome on finance for loss and damage,” Huq told SciDev.Net. “We expect them to play that role.”

CAN’s Sharma, however, remains sceptical of claims from the most powerful countries – including the United States and the European Union, who rejected calls for a loss and damage mechanism at COP26 – that they are committed to addressing loss and damage this year.

She adds: “Egypt needs to bring the moral argument to a higher level and remind wealthy countries that their failure to act quickly on mitigation, to keep their promises about climate finance and the balance of adaptation finance in particular, has caused even more loss and damage.”

This article is part of our Spotlight on ‘Africa’s crisis COP’

This article was produced by SciDev.Net’s Global desk.