WASHINGTON – The decision Sunday by nations around the world to establish a fund to help poor countries hit hard by a warming planet was one of the most significant since UN climate talks began 30 years ago, the Associated Press reported.
It was an unequivocal confirmation that poor countries, with limited resources, are being most impacted by extreme weather events like floods, heat waves and storms and, at least at some level, industrialized nations that have done the most to contribute to climate change have a responsibility to help.
While government leaders, environmentalists and activists celebrated plans for such a fund, there are many outstanding questions, ranging from how it will work to long-term repercussions. Here is a look at the development of the idea of “loss and damage,” the term it’s given in climate negotiations, and what we know about the fund.
In the early 1990s, the Alliance of Small Island States, a group of low-lying coastal and small island countries, began calling for the establishment of a loss and damage fund as the United Nations was creating a framework to deal with climate change on an international level.
Since then, the idea has always been a part of annual UN climate summits. However, it was often talked about on the margins of negotiations, something developing nations and activists would push for while many rich nations used their weight to squash the idea. For the first time, at this year’s COP27 it was included in the agenda and became the centerpiece of discussions.
The fund will initially draw on contributions from developed countries and other private and public sources, such as international financial institutions, with an option for other major economies to join down the line.
The final text points to “identifying and expanding sources of funding,” something the EU, the US and others had pushed for during negotiations, suggesting that nations that are both high-polluting and considered developing under the criteria, should also pay into the fund.
During the talks, China said money for the new fund should come from developed countries, not them. But there’s precedence for China to voluntarily pay into climate funds, if the US does too.
When the Obama administration pledged $3 billion to the Green Climate Fund in 2014, China also paid $3.1 billion for the fund.
The deal says the fund will assist “developing countries that are particularly vulnerable to the adverse effects of climate change,” though there will be room for middle-income countries that are severely affected by climate disasters to also get paid.
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