EXPLAINER: How will the UN climate deal on loss and damage work?

SHARM el-SHEIKH, Egypt (AP) — The decision Sunday by nations around the world to establish a fund to help poor countries hardest hit by global warming was one of the most significant since climate talks began in the UN 30 years ago.

It was unequivocal confirmation that poor countries, with limited resources, bear the brunt of extreme weather events such as floods, heat waves and storms and, at least on some level, industrialized nations that have done the most to contribute to climate change. They have a responsibility to help.

While government leaders, environmentalists and activists have welcomed the plans for such a fund, many questions remain, ranging from how it will work to its long-term implications. Here’s a look at the development of the idea of ​​”loss and damage,” the term given to it in the climate negotiations, and what we know about the background.

HISTORY

In the early 1990s, the Alliance of Small Island States, a group of low-lying small island and coastal countries, began calling for the establishment of a loss and damage fund, as the United Nations was creating a framework for comprehensively address climate change. international level.

Since then, the idea has always been a part of the UN’s annual climate summits. Yet it was often talked about on the sidelines of negotiations, something developing nations and activists would push for, while many rich nations used their weight to crush the idea. For the first time in this year’s COP27 was put on the agenda and became the focus of the discussions.

WHO WILL FUND IT?

Initially, the fund will draw on contributions from developed countries and other public and private sources, such as international financial institutions, with the option for other major economies to join later.

the final text it aims to “identify and expand sources of funding”, something that the EU, US. and others had lobbied during the negotiations, suggesting that nations that are highly polluting and considered developing according to the criteria should also contribute to the fund.

During the talks, China said that the money for the new fund should come from developed countries, not them. But there is a priority for China to voluntarily pay into climate funds, if the United States does as well.

When the Obama administration pledged $3 billion to the Green Climate Fund in 2014, China also paid $3.1 billion for the fund.

More details about who pays will be decided by a committee that plans to launch the fund within a year.

WHO WILL RECEIVE THE MONEY?

The agreement says the fund will help “developing countries that are particularly vulnerable to the adverse effects of climate change”, although there will be room for middle-income countries that are severely affected by climate disasters to also receive payments.

Pakistan, which was devastated by floods that submerged a third of the countryo Cuba, recently hit by Hurricane Iancould be eligible.

You will need to figure out how the loss and damage fund will fit in with “other institutions, agencies that are doing humanitarian work, helping people rebuild, dealing with migration and refugee crises, dealing with food security, water security “, said. David Waskow, international climate director at the World Resources Institute.

Those details will also be worked out by the committee next year.

REBUILDING TRUST

Beyond financial aid, the creation of the fund is seen as a big step forward, but how it ultimately looks will depend in part on how quickly it can be set up.

In Sunday’s closing session, Antigua’s Lia Nicholson said the transition committee must be established immediately and given clear mandates.

“This loss and damage fund must become the lifeboat we need it to be,” he said.

There is a credibility gap due to broken promises in the past.

In 2009, wealthy nations agreed to provide $100 billion a year to help developing countries transition to green energy systems and adapt to climate change. However, to date, that initiative has never been fully funded.

REPERCUSSIONS

One of the main reasons rich nations long opposed such a loss and damage fund was fear that it would open itself up to long-term liability. Despite the approval, that concern is still at stake, as evidence of how negotiators ensured that the fund’s language did not say “liability” and that contributions were voluntary.

Despite those warnings, the establishment of such a fund could have repercussions, both legal and symbolic, in climate circles and beyond. For example, several Pacific island nations have been lobbying for the International Court of Justice to consider climate change. They argue that international law must be strengthened to protect their rights should their land be engulfed by rising sea levels. The establishment of a loss and damage fund could reinforce those arguments.

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Associated Press writers Frank Jordans and Seth Borenstein contributed to this report.

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Associated Press climate and environmental coverage is supported by several private foundations. See more about AP’s climate initiative here. The AP is solely responsible for all content.

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