A delegate arranges a display outside the United Kingdom pavilion at the Dubai's Expo City, during the United Nations Climate Change Conference in Dubai, United Arab Emirates, December 4, 2023.
Credit: Reuters Photo
The first major decision taken by the ongoing Conference of Parties (CoP28) at Dubai was to officially launch the Loss and Damage (L&D) fund to help vulnerable countries cope with the impact of climate change. The proposal for the fund is three decades-old and has gone through many changes. At CoP27 in Egypt, it was announced that it would be launched. The details were ironed out in many meetings held later, and a few days ago, there was agreement on some key details. But some crucial issues still remain to be worked out. While it is welcome that it was approved on the first day of the meet, there are apprehensions that the issues that remain to be settled will remain so. That would mean that many countries that need to get aid from the fund would not get it or may not get in time or as much as they need.
According to the present agreement, the World Bank will oversee the fund for a period of four years, charging a significant overhead fee for it. The funds will include those from advanced nations such as the US, the UK and the EU, as well as some developing countries like the UAE. The commitments are not big and the method and scale of replenishment is not clear. The committed funds total just $450 million when the need is for many billions. Developing countries were not happy with the World Bank managing the fund but finally they reached a compromise. They have also pointed out that developed countries have missed their 2020 deadline to mobilise a promised $100 billion, which was itself inadequate, in climate finance. The contributions to the Loss and Damage fund are voluntary and countries have been invited to make them.
Developing countries have to struggle a lot to ensure that the fund is adequately financed to meet the needs of those countries which suffer because of extreme weather events caused by climate change. These include floods, tropical cyclones, heat waves and other phenomena which impact agriculture, community life, etc. At present, there is no accepted system to evaluate the loss and damage either, apart from the problem about sourcing and replenishing funds. A UN official hoped that the World Bank will act in a fair and equitable manner so that
the fund won’t fall into the control of a few countries. While the requirements for the use of the fund and the demands on it are increasing every day, the actual situation is that the fund exists only nominally now. While a baby step has been taken, there is the need for giant strides to make it useful.