COP27: Climate talks inch toward ‘loss and damage’ showdown

• Negotiators at COP27 in Sharm el-Sheikh braced for battle over how and when to deliver climate funding.
• The topic of “loss and damage” has emerged as a pivotal issue during UN talks.
• G77+China group of developing nations call for special funds to help deal with the costs of climate impacts.

Tuesday, negotiators at the COP27 climate conference in Egypt braced for an impending battle over how and when to deliver funding to developing nations afflicted by deadly and expensive climate impacts.

The topic of “loss and damage” has been inching its way toward the center of the worldwide climate agenda for decades, but it has just been formally placed on the negotiating table this year, as the battle lines between affluent polluting nations and vulnerable poor countries have hardened.

In a position paper, the G77+China group of over 130 developing nations asked for a special fund “to help developing countries in managing the expenses of addressing non-economic and economic loss and damage” resulting from extreme weather events and rising sea levels.

The necessity for such “loss and damage” money, which has emerged as a pivotal issue during the UN talks in Sharm el-Sheikh, is “urgent and immediate,” according to the main negotiating bloc.

For decades, countries least responsible for emissions that contribute to global warming — but hardest struck by storms, heatwaves, and droughts — have pressed affluent nations for funding.

In recent months, nations have been struck by a crescendo of natural disasters, including the August flooding that submerged a third of Pakistan and caused up to $40 billion in damage.

How much money would be placed into the fund, and where it would come from, were left unsaid, but the G77+China urged for the facility to be ready for approval before next year’s COP28 in Dubai.

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The United States and the European Union have dragged their steps, fearing that establishing a financial facility could subject them and other wealthy nations to indefinite compensation claims.

In its own “talking points” published on Tuesday, the EU underlined “the necessity and urgency” for loss and damaged money, adding that “existing finance methods are not able to cover all necessary activities.”

But rather than establishing a new facility in Sharm el-Sheikh, they advocate the beginning of a time-bound initiative to study a “mosaic of alternatives”.

The United States and the European Union have proposed that expanding existing channels for climate finance may be a more efficient strategy than establishing a new one.

In light of rich nations’ unfulfilled pledge to spend $100 billion per year beginning in 2020 to help developing nations green their economy and adjust to future repercussions, poor nations are leery of a new timeline.

“They’re afraid they are being taken for a ride,” said a senior negotiator working on the matter.

A third document released Tuesday, authored by two ministers from Germany and Chile tasked with shepherding talks on loss and damage funding, puts all the alternatives on the table.

It also refers to strategic wording that might become the basis of a compromise — a request for a two-year process to assess future “financing arrangements”, which may or may not involve a stand-alone facility.

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