COP28 President-designate and Minister of Industry and Advanced Technology, Dr Sultan Al Jaber, welcomed an agreement reached in Abu Dhabi on Saturday, November 4, 2023, by a special UN committee, the fifth Transitional Committee Meeting on the Loss and Damage Fund.
The transitional committee agreed on several recommendations that will be considered by governments at COP28 which starts in Dubai in just a few weeks.
The loss and damage fund was established at COP27 last year but governments have struggled to adapt it with the extra round of talks in Abu Dhabi scheduled for this weekend after an agreement eluded negotiators in Egypt last month.
“This clear and strong recommendation to operationalise the loss and damage fund and funding arrangements paves the way for agreement at COP28,” said Dr Al Jaber.
“Billions of people, lives and livelihoods who are vulnerable to the effects of climate change depend upon the adoption of this recommended approach at COP28.”
The fund aims to help countries – particularly those most vulnerable – deal with the irreversible damage from climate change.
The committee recommended the World Bank administer the fund for an initial period, but some developing countries had viewed this proposal as potentially representing the interests of western countries.
The committee also urged developed countries to provide support to the fund, Reuters reported. It is understood that whether wealthy nations would be under strict obligations to contribute has not yet been resolved.
Jennifer Morgan, Germany’s climate envoy, said it was “great news” that an agreement had been signed off.
Writing on X, formerly Twitter, Ms Morgan said Germany “stands ready to fulfil its responsibility – we’re actively working towards contributing to the new fund and assessing options for more structural sources of financing and calls on all other countries able to contribute to do the same”.
Eamon Ryan, Ireland’s climate minister, highlighted that “not everyone will be happy but we can now sign off on it” at COP28 and set it up quickly.
The Association of Small Island States, which represents 39 small island and low-lying coastal developing states, said “it has been a long road to ensure we keep the … fund moving towards fruition – our work is far from done. Aosis will not rest until this fund adequately supports the victims of the climate crisis”.
Further debate about the issue is now expected at COP28.
But civil society operatives are unexcited over the development, claiming that the meeting concluded “amidst compromise and disappointment”.
Liane Schalatek, Associate Director, Heinrich Böll Foundation, Washington, said: “This is not the Loss & Damage Fund that we wanted; this is not the Loss & Damage Fund that vulnerable communities and people in developing countries already suffering from devastating losses and damage deserve. It lacks a strong commitment to human rights and does give insufficient guarantees that affected communities will directly benefit from and have a say in decision-making about its funding.
“The agreement that was gaveled lacks any indication of scale, further marches climate finance provision from obligation to voluntarism, with developed countries denying any historical responsibility and shirking commitments and settles the new fund institutionally with the World Bank as host, instead of providing new thinking and new structures through a standalone fund. This was not climate justice provided but naked power politics by developed countries, led by the US, at its worst. Now the real work begins to ensure that this fund is not an empty shell and is filled with ambition and capital.”
Harjeet Singh, Head of Global Political Strategy, Climate Action Network International, said: “It is a sombre day for climate justice, as rich countries turn their backs on vulnerable communities, allowing those who have contributed the least to the climate crisis to suffer its most severe consequences. The reluctance of wealthy nations to fulfill their financial responsibilities, in spite of historical obligations, has starkly revealed their true intentions and their indifference to the plight of the developing world.
“Rich countries, particularly the USA, have not only coerced developing nations into accepting the World Bank as the host of the Loss and Damage Fund but have also evaded their duty to lead in providing financial assistance to those communities and countries most in need of support to recover from the intensifying impacts of climate change.
“The current set of recommendations to operationalise the Loss and Damage Fund falls short of providing vulnerable communities with adequate assurance that their financial needs for coping with climate impacts and rebuilding their lives will be met.”
Rachel Cleetus, Policy Director, Climate and Energy Programme, Union of Concerned Scientists, said: “The final outcome reflects richer nations, including the United States, continuing to evade their primary responsibility to contribute to a climate Loss and Damage fund for low- and middle-income countries facing a devastating onslaught of extreme climate impacts. Wealthy nations also steamrolled developing countries into accepting a lopsided compromise to locate the fund at the World Bank, an institution with a donor-driven lending model and an undemocratic governance structure that raises serious concerns about its ability to host the Loss and Damage Fund.
“The deeply compromised outcome on Loss and Damage from this Transitional Committee meeting will have serious reverberations at COP28. The United States and other rich countries will have to dig deep to overcome the significant trust and ambition deficit they’ve created, so that COP28 can deliver climate action in line with the latest science that the world so desperately needs.”
Isatis M. Cintrón-Rodriguez, Director, Climate Trace PR, said: “The TC5 is a denial of climate justice. The agreement operationalises a fund that is not fit for purpose and doesn’t provide the necessary provisions to reach those in need. The indentation to evade historical responsibilities was evident. It was heartbreaking to see developing countries accepting a fund almost in tears. Developing countries have come to the table with a sense of urgency, given that their communities are in the fight for survival.
“This process has been an exploitation of vulnerable countries. Developed countries have taken advantage of the negotiation in good faith to impose, twist arms, and oppose the most basic principles that have been recognised in climate multilateralism. This fund falls short of the challenge of addressing loss and damage, it doesn’t have scale, financial obligations, shared governance with affected groups, or basic principles of climate justice and equity.”
Lien Vandamme, Senior Campaigner, Centre for International Environmental Law, said: “This process has been derailed by delay and denial tactics by the US & other rich historic polluters. It was never about justice, and this Loss and Damage Fund will not deliver it. The so-called interim arrangement under the World Bank risks ending up as a permanent hosting situation and will undermine the Fund’s ability to meet the needs and priorities of communities. There’s no obligation for rich historic polluters to pay, no indication of the scale of the Fund, no affected communities in the driver’s seat and – critically – no guidance that the Fund will operate consistent with human rights obligations.
“The massive time and energy that were put into fighting back against unjust proposals by developed countries distracted from the actual task at hand to design a Loss and Damage Fund that would provide effective remedy for communities suffering harms from the climate crisis. That the US finally could not even agree with the massively watered down text after cornering developing countries into accepting it, is a testimony to its lack of good faith effort to actually deliver an effective Fund.”