World leaders participating in COP28, the UN’s Climate Change Conference, have agreed to put into practice the Loss and Damage Fund. Officially established at COP27 in 2022 after years-long discussions between developed and developing countries, the fund’s implementation a year later has been largely seen as “a hard-won victory” by developing countries that have already been badly hit by weather disasters triggered by climate change. However, the breakthrough was marred by the announcement that the initial funding would amount to just US$700 million, with experts estimating that climate-related loss and damage incurred by developing countries exceeds US$400 billion annually.
The COP28 host country, the United Arab Emirates, pledged US$100 million to the fund with Germany donating the same amount. France and Italy will each contribute over US$100m, the European Union committed US$245m and the UK will give US$75m. The US, the world’s second-largest polluter, committed just US$17.5m whereas Japan, which is among the top 5 biggest polluters, decided to allocate only US$10m.
Main polluters reluctant to contribute
According to Jassir Al-Asdy, an environmental activist, COP28 succeeded in establishing the foundation of the fund by gaining specific commitments from certain countries. However, it is evident that raising just US$30 billion in the initial phase is still a long way short of the funding required. Many countries, including China and Russia, which are among the major users of oil, pollutants of the environment, and responsible for high carbon emissions, are completely avoiding any commitment to contribute to this fund.
China, ranked as the world’s biggest polluter, will not commit to making a contribution, according to Al-Asdy. He contends that the negotiations with China since COP27 have fluctuated with China maintaining that 90% of the carbon present from the industrial revolution to 1950 came from the major industrialized countries whereas, until then, China had not been responsible for global warming. It also claimed that many of its citizens with low incomes resembled the social fabric of developing countries and therefore China did not fall into the ranks of those major countries that must pay the carbon emissions tax.
“I believe that industrialized countries will commit, but only minimally,” Al-Asdy, told DevelopmentAid. “They will not contribute significantly to the Loss and Damage Fund. The summit’s outcomes showed that they did not agree on a set period for abandoning oil or fossil energy, which may be a reason why these countries are not making big commitments.”
According to Al-Asdy, “pressuring major industrial countries to fulfill their logical commitments to the fund necessitates stricter measures, as well as solidarity from developing and more vulnerable countries.” A higher authority is required to oversee this fund, propose projects that correspond with the level of damage caused and direct funding towards weak and poor countries.
“Robust” framework needed to secure fund’s sustainability
Maysoun Al-Zoubi, an international water and water diplomacy expert, stressed to DevelopmentAid that the fund’s sustainability hinges on the commitment of contributing countries. This underscores the need for a robust framework to ensure that nations fulfill their commitments to address climate concerns. She emphasized that climate change is a global issue, with even wealthy and responsible countries susceptible to its consequences.
“The diversity of financing methods strengthens the Fund’s sustainability,” Al-Zoubi added.
Every country is compelled to implement adaptation or mitigation measures which incurs costs. Fair mechanisms that consider the conditions of vulnerable and poor nations will prevent any damaging consequences. The availability of soft loans helps wealthier sectors, particularly industrial and private sectors, to undertake the necessary adaptations or mitigations.
“The announced objective is general, not specific, and cannot be measured,” she noted. “What does this signify for the countries that have been most affected? Therefore, the other objectives must be precisely defined, and I anticipate they will be comprehensively crystallized at the next climate summit.”
She added, “I sincerely hope that representatives from the nations affected by these issues actively shape the goals, conditions, and processes to guarantee fair and adequate representation. The methods devised must be straightforward and efficient for swift implementation. Additionally, these nations should be provided with guidance on navigating the application process for financing from various climate programs as these programs should ideally complement each other.”
