Compensation or “loss and damage” financing is considered a fundamental issue of climate justice. The hot-button issue made history on Sunday at the start of the COP27 climate summit, officially being endorsed on the agenda for the first time. The decision to include loss and damage financing as an agenda item, proposed by Pakistan, was preceded by 48 hours of talks. Climate envoys gathered in Egypt’s Red Sea resort of Sharm el-Sheikh will now discuss a deal on a financial facility that would see rich nations provide cash for losses and damages to vulnerable countries. Pakistan’s Bilawal Bhutto Zardari told CNBC that it was a success that damage and loss financing was finally approved on the COP27 agenda, highlighting the role that developing countries played in building consensus on this issue. He now hopes that the international community can find a way to collectively address loss and damage funding. “We discovered firsthand through the devastating, apocalyptic flooding we experienced earlier this year, and are still dealing with the aftermath of that, that … an event of this scale [does] we don’t have any international financial mechanism available to be able to deal with a tragedy of this scale,” Zardari told CNBC on Tuesday. Months of incessant rain in Pakistan have submerged vast swaths of the South Asian nation, displacing millions as floods swept away homes, transport, crops and livestock. Zardari estimated the total damage at an “astronomical” amount of $30 billion. Zardari said Pakistan was “aware” of the difficult economic environment, citing the effects of the coronavirus pandemic and Russia’s war in Ukraine, but added that “this has really become a compound tragedy” for the country. The disaster highlights the disparity between those most affected by the effects of a warming planet and those who bear the greatest historical responsibility for the climate crisis. “We cannot deny that there are no losses and damages. I mean I had a third of my country under water which will prove otherwise, but I don’t want to mention it as a kind of responsibility or compensation,” Zardari said, referring to a reluctance by rich countries to accept responsibility for loss and damage; “This is not going to stop in Pakistan,” he warned. “The next country to be hit should have something available to deal with the loss and damage.”
“Not a very constructive agenda”
Rich countries have long opposed the creation of a fund to deal with loss and damage, and many policymakers fear that accepting responsibility could trigger a wave of lawsuits from countries on the front lines of the climate emergency. US climate envoy John Kerry has previously stated that the US will not be prepared to compensate countries for the losses and damages they have suffered as a result of the climate emergency. However, in an apparent softening of that stance, Kerry has since said Washington will not “impede” talks on casualties and damage at COP27. US climate envoy John Kerry said Washington would not “block” talks on casualties and damage in Sharm el-Sheikh. Bloomberg | Bloomberg | Getty Images “Loss and damage is important, but it’s not a very constructive agenda,” Johan Rockström, director of the Potsdam Institute for Climate Impact Research and one of the world’s leading Earth scientists, told CNBC in Sharm el-Sheikh. “It risks driving a deep divide between North and South and could bring these negotiations to a halt when what the world needs most is to move away from dangerous climate change,” Rockstrom said. “And now we are on a path that undoubtedly leads us to destruction.” A series of major UN reports published in recent weeks have provided a grim assessment of how close the planet is to irreversible climate collapse, warning that there is no “credible pathway” to limiting global warming to the critical temperature threshold of 1, 5 degrees Celsius. “We know the task before us,” said Harjeet Singh, head of global policy strategy at the Climate Action Network, which includes more than 1,500 civil society groups. “We should also understand the responsibility we have here as part of these UN negotiations because what we do or don’t do has an impact on people who are already suffering. We are talking about the reality outside these conference walls,” Singh said. CNBC. Months of incessant rain in Pakistan have submerged vast swaths of the South Asian nation. Asif Hassan | Afp | Getty Images Asked if there was a risk that the push for loss and damage funding would lead to a collapse of the COP27 talks, Singh replied: “What I say to that is that loss and damage has not been on the table for the last 30 years and look what has happened ». “The loss and damage is a report card of inactivity for the last 30 years. And the loss and damage tells us that there is a consequence now,” Singh said. “If we had talked about loss and damage in 1992, that if they’re not mitigated, you’re going to have to pay for loss and damage, you’d have got it right at the start.”
Finance is the key to making it all happen
Former UN climate chief Patricia Espinosa, meanwhile, told CNBC that climate finance “is the key to making everything happen.” “It’s been the case for several conferences, but now that we’re entering an application era, this is the area that will make the difference.” Espinoza said she was particularly concerned that a $100 billion climate finance pledge by rich countries in 2009 to help low-income nations mitigate and adapt to the climate emergency had not yet been met. “It’s at the center of some mistrust that we’re seeing, so I come with a lot of concern about that,” Espinoza said. “There is a very clear need to find the money and I don’t see it. However, what I hope can happen is that we can actually start to have a very serious and well-informed discussion about loss and damage funding,” she he added.
