Historic ‘loss and damage’ fund adopted at COP27 climate summit

Countries at the United Nations COP27 climate summit in Egypt have adopted a final agreement that establishes a fund to help poor nations cope with the extreme weather events caused by global warming.

Following tense negotiations that ran through the night, the summit’s Egyptian presidency released a draft text of the overall agreement early on Sunday and also called a plenary session to push the document through as the final, overarching agreement for the UN summit.

Countries at the United Nations COP27 climate summit in Egypt have adopted a final agreement that establishes a fund to help poor nations cope with the extreme weather events caused by global warming.

Following tense negotiations that ran through the night, the summit’s Egyptian presidency released a draft text of the overall agreement early on Sunday and also called a plenary session to push the document through as the final, overarching agreement for the UN summit.

Collins Nzovu, Zambia’s minister of green economy and environment, said he was “excited, very, very excited”.

“Very exciting because for us, success in Egypt was going to be based on what we get from loss and damage,” he said.

“This positive outcome from COP27 is an important step toward rebuilding trust with vulnerable countries.”

According to the agreement, the fund would initially draw on contributions from developed countries and other private and public sources such as international financial institutions.

While major emerging economies such as China would not initially be required to contribute, that option remains on the table and will be negotiated over the coming years.

This is a key demand by the European Union and the United States, who argue that China and other large polluters currently classified as developing countries have the financial clout and responsibility to pay their share.

The fund would be largely aimed at the most vulnerable nations, though there would be room for middle-income countries that are severely battered by climate disasters to get aid.

Experts said the adoption of the fund was a reflection of what can be done when the poorest nations remain unified.

“I think this is huge to have governments coming together to actually work out at least the first step of … how to deal with the issue of loss and damage,” said Alex Scott, a climate diplomacy expert at the think-tank E3G.

But, like all climate financials, it is one thing to create a fund and another to get money flowing in and out, she said.

The developed world still has not kept its 2009 pledge to spend $100bn a year in other climate aid – designed to help poor nations develop green energy and adapt to future warming.

“In many ways, we’re talking about reparations,” said University of Maryland environmental health and justice professor Sacoby Wilson.

“It’s an appropriate term to use,” he said, because rich northern countries had received the benefits of fossil fuels, while the poorer global south nations were suffering the effects of climate change.

Some delegates meanwhile said the approved deal does not do enough to boost efforts to tackle the emissions that cause global warming.

It did not contain a reference requested by India and some other delegations to the phasing down use of “all fossil fuels”.

It instead called on countries to take steps toward “the phasedown of unabated coal power and phase-out of inefficient fossil fuel subsidies,” as agreed at the COP26 Glasgow summit.

The draft also included a reference to “low-emissions energy”, raising concern among some that it opened the door to the growing use of natural gas – a fossil fuel that leads to both carbon dioxide and methane emissions.

Norway’s Climate Minister Espen Barth Eide told reporters his team had hoped for a stronger agreement. “It does not break with Glasgow completely, but it doesn’t raise ambition at all,” he said.

“I think they had another focus. They were very focused on the fund,” he said.

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