Countries moved a step closer on Saturday to getting a fund off the ground to help poor states damaged by climate disasters, despite reservations from developing nations and the United States.
The deal to create a “Loss and Damage Fund” was hailed as a breakthrough for developing countries’ negotiators at United Nations climate talks in Egypt last year, overcoming years of resistance from wealthy nations.
It was Pakistan, being the co-host of the COP27 held last year at Sharm el Sheikh in Egypt, that had led the successful efforts for creating the fund amid the resistance and objections raised by the rich countries.
The member nations of the United Nations Framework Convention on Climate Change (UNFCCC) decided “to establish new funding arrangements for assisting developing countries that are particularly vulnerable to the adverse effects of climate change, in responding to loss and damage”.
Pakistan was selected as the COP27 co-host after it faced unprecedented devastation caused by the floods earlier that year during the monsoon season, as the country along with others in the region are experiencing climate change-induced extreme weather events at an alarming rate.
But in the past 11 months, governments have struggled to reach consensus on the details of the fund, such as who will pay and where the fund will be located.
A special UN committee tasked with implementing the fund met for a fifth time in Abu Dhabi this week – following a deadlock in Egypt last month – to finalise recommendations that will be put to governments when they meet for the annual climate summit COP28 in Dubai in less than four weeks’ time.
The goal is to get the fund up and running by 2024. The committee, representing a geographically diverse group of countries, resolved to recommend the World Bank serve as trustee and host of the fund – a tension point that has fuelled divisions between developed and developing nations.
Housing a fund at the World Bank, whose presidents are appointed by the US, would give donor countries outsized influence over the fund and result in high fees for recipient countries, developing countries have argued.
To get all countries on board, it was agreed the World Bank would serve as interim trustee and host of the fund for a four-year period.
