Funding climate change-induced losses and damage

UN moves to set-up Fund for poor and developing countries

Kampala, Uganda | RONALD MUSOKE | The United Nations has established a transitional committee to begin work on operationalizing a new fund whose purpose is to respond to climate change-related losses and damage in poor and developing countries like Uganda.

The inaugural transitional committee meeting took place in Luxor, Egypt, from March 27-29 and was focused on ironing out and adopting its workplan. The decision to establish a dedicated fund to assist developing countries respond to economic and non-economic losses and damages associated with climate change was reached at last year’s UN Climate Change Conference COP27 in Sharm el Sheikh, Egypt.

The transitional committee is due to work out how the fund will operate, who will pay, who will benefit, and how it will be governed and make recommendations ahead of the next round of UN climate talks in the United Arab Emirates this November.

“You are here not just to construct a fund, but to create something much bigger: a lifeline for vulnerable people and places,” said Simon Stiell, the UN Climate Change executive secretary. Stiel told the committee to approach their work in a way that is creative, collaborative, and constructive, “so that we can respond to the mandate and rise up to the challenge that is before us.”

According to a statement published on April 3 by the United Nations Convention on Climate Change (UNFCCC), the meeting concluded with the adoption of a workplan towards COP28 which is scheduled for Nov.30 Dec.12 in the United Arab Emirates.

The workplan sets out key substantive and procedural milestones and steps to be taken towards the delivery of recommendations to COP28. It includes dates for upcoming workshops and meetings of the transitional committee, including a fourth meeting, which the Committee has agreed to add to its schedule of work in 2023. According to the plan, the Committee will focus on all elements of its mandated recommendations at each gathering, gradually moving towards a consensus outcome a month or so before COP28.

The Luxor meeting came a week after the UN’s Intergovernmental Panel on Climate Change (IPCC) the United Nations body tasked with assessing the science related to climate change issued a synthesis report on March 20. The IPCC again warned of calamities that developing countries must prepare for should the current trends of global warming continue.

“Mainstreaming effective and equitable climate action will not only reduce losses and damages for nature and people, it will also provide wider benefits,” said Hoesung Lee, the IPCC Chair, “This Synthesis Report underscores the urgency of taking more ambitious action and shows that, if we act now, we can still secure a liveable sustainable future for all.”

Africa, the IPCC report noted, is paying an intolerable price for the impacts of climate change. It says: “Prioritizing equity, climate justice, social justice, inclusion and just transition processes can enable adaptation and ambitious mitigation actions and climate-resilient development.”

Losses and damages

The report, approved during a week-long session in Interlaken, Switzerland, brought into sharp focus the losses and damages countries are already experiencing and will continue into the future, hitting the most vulnerable people and ecosystems especially hard. Taking the right action now could result in the transformational change essential for a sustainable, equitable world.

“Climate justice is crucial because those who have contributed least to climate change are being disproportionately affected,” said Aditi Mukherji, one of the 93 authors of the Synthesis Report, the closing chapter of the Panel’s sixth assessment.

In 2021, more than 30 million people were displaced by climate-related disasters. In Africa, 52 million people 4% of the population have suffered either drought or floods over the past two years, according to the latest State and Trends in Adaptation in Africa 2022 report.

The report noted that the drought in the Horn of Africa, now in its fifth year, is worse than the conditions that led to famine in 2011. Close to 23 million people are currently highly food insecure in Ethiopia, Kenya and Somalia.

Former United Nations Secretary-General Ban Ki-moon and Patrick Verkooijen; the CEO of the Global Centre on Adaptation, said they expect the fund not to be empty by the time the next UN climate summit convenes in the U.A.E in November this year.

International finance for reducing emissions and adapting to climate risks in the developing world has repeatedly fallen far short of the US$100 billion annual target set by the rich countries 14 years ago.

The little money that the developing countries have tried to receive has often arrived with red tape. As a result, many; including Uganda, have had to shelve their climate response programmes waiting for the rich countries to fulfill their pledges.

Uganda is one of the most vulnerable countries to climate change, according to the Notre Dame Global Adaptation Index report 2021 which listed it as the 12th most vulnerable state in the world. In response, the government has come up with a costed strategy for implementing its climate change commitments.

The total cost hovers in the region of US$28.1 billion over the next seven years to implement its climate change programmes but the Ugandan government says it can only afford to raise US$ 4.1 billion domestically. This means that Uganda hopes to raise the remaining balance from international climate financing mechanisms.

Transitional Committee’s work plan

The transitional committee formed to enable the operationalisation of the new funding arrangements comprises 24 members, including 10 from developed countries and the rest from developing countries. Richard Sherman from South Africa and Outi Honkatukia from Finland are its co-chairs.

The transitional committee will be assisted by a technical support unit. The unit consists of staff seconded from UN agencies, international financial institutions, multilateral development banks, and the operating entities of the financial mechanism. Secondments have been received from the Adaptation Fund, the UN Office for Disaster Risk Reduction, the Global Environment Facility, the Green Climate Fund, the United Nations Multilateral Fund for the Implementation of the Montreal Protocol, the World Bank, and the UN Environment Programme, among others.

The workplan reflects the large volume of work ahead to fulfill the mandate in the months ahead. Regular intersessional work, including monthly calls, will also take place to advance the work.

However, for Harjeet Singh, the head of Global Political Strategy at Climate Action Network International, a global network of over 1900 civil society groups in 130 countries, although the UN has taken the initiative, the proposed new fund remains “a shell.”

Singh who is a veteran climate campaigner said while the steps to implement the COP27 decisions have been agreed, the pace is of serious concern.

“Rich countries must go beyond their usual approach of blocking and delaying progression on loss and damage finance and play a constructive role in setting up the Fund that responds with the speed and scale to meet the needs of most vulnerable communities.”

“More needs to be done to structurally enhance our participation. This is going to be a hectic year, folks. Lots to do and the time is not on our side,” he added.

Singh’s sentiments are shared by Ban Ki-moon and Verkooijen who recently urged the rich countries to honour its pledges on climate finance and investment.

In Africa, people are already living with some of the worst effects of climate change—a problem they did not cause and are powerless to stop, Ki-moon and Verkooijen noted in their Op-ed recently published by Thomson Reuters Foundation.

“It’s the rich world’s accumulated greenhouse gas emissions that are inflicting devastating droughts or torrential floods across vast swathes of the continent. It’s here where hunger is on the rise and decades of economic and social progress have been thrown into reverse. Worse, African countries are having to borrow more, and get deeper into debt, to recover after climate disasters. How is this fair?”

According to some experts, African countries face seeing their GDP growth rate fall by up to 64% by the end of the century, even if the world succeeds in limiting global heating to 1.5°C. The economic cost of climate disasters in developing countries is projected to reach as much as US$ 580bn a year by 2030.

Investing in a more resilient future

Ban Ki-moon and Verkooijen said Africa does not want aid or emergency relief funds. “It wants to invest in a climate-resilient future.

“It needs funding to rebuild roads, bridges and buildings so they can withstand frequent flooding and storms. It needs to invest in R&D to develop new crop strains that can withstand prolonged droughts. It needs to give farmers access to climate data services, and much else besides.”

“Climate adaptation needs to be built in so that communities not only build back after a natural disaster, but also build back better. The key is to be able to do this quickly and at scale, because right now the world’s poorest and most climate-vulnerable nations are at risk of falling into a destructive debt and climate-disaster trap.”

“Doing so will not only restore the fractured trust between climate-vulnerable regions and the rich world; it will also be the surest way to achieve climate justice and build a more stable global order.”