The Fund, located within the World Bank for the next four years as an interim arrangement, will be meant for supporting developing countries, particularly the most vulnerable ones, impacted by climate change.
Contribution to the fund will be on a ‘voluntary’ basis – the point insisted to be in the final decision by the rich nations who did not want it to be ‘mandatory’. The text states that the developed countries, considered historically responsible for climate change, are “invited” to make contributions even as the developing countries, including India, China and others, too can contribute.It has been agreed that the fund should have “at least” $100 billion a year in the Fund by 2030. The developing countries had, however, been pitching for a minimum $400 billion per annum.
The UAE made a first move by contributing $100 million to the fund. The other countries announced their respective contributions include Germany ($100 0million), the UK (£40 million for the Fund and £20 million for other arrangements), Japan ($10 million) and the US ($17.5 million).All the countries together announced a contribution of $450 million to the Fund on the first day.
Calling it a “positive signal of momentum from COP28” on the first day itself, environment minister Bhupender Yadav said it’s a “landmark decision” on operationalisation of the Fund that was adopted in the opening plenary of the UN climate conference. He said, “India strongly supports the decision to operationalise the Loss and Damage Fund.”
All developing countries that are particularly vulnerable to the adverse effects of climate change are eligible to directly access resources from the Fund, but it’ll earmark a minimum percentage allocation for Least Developed Countries and Small island developing nations.
“This Fund will support billions of people, lives and livelihoods that are particularly vulnerable to the effects of climate change…It proves, the world can unite, can act, and can deliver. Over the next two weeks this Presidency will work with Parties (countries) to now deliver the highest-ambition response to the global stocktake (GST), ” said COP28 president Sultan Al Jaber after gavelling the first major milestone of the UAE presidency.
The countries on Thursday, in fact, agreed on recommendations of the UN transitional committee that was formed to suggest ways and means to operationalise the fund. The Fund was first agreed upon during COP27, held in Sharm el-Sheikh, Egypt last year, and now becomes operational following the agreement reached by countries over the recommendations by the committee that held its final meeting in Abu Dhabi early this month.
“This is a hard fought historic agreement.It shows recognition that climate loss and damage is not a distant risk but part of the lived reality of almost half of the world’s population and that money is needed to reconstruct and rehabilitate if we are not to let the climate crisis reverse decades of development in mere moments,” said Avinash Persaud, developing country negotiator and special climate envoy to Barbados.
“Amid the historic decision to operationalise the Loss and Damage Fund within a year of its establishment, addressing underlying concerns becomes critical. On one hand, rich countries have pushed for the World Bank to host this Fund under the guise of ensuring a speedy response. Conversely, they have attempted to dilute their financial obligations and resisted defining a clear finance mobilisation scale. The absence of a defined replenishment cycle raises serious questions about the Fund’s long-term sustainability. Therefore, a robust system, particularly integrated with the Global Stocktake process and the new climate finance goal, is needed to ensure that COP28 results in a meaningful outcome,” said Harjeet Singh, head of global political strategy at Climate Action Network International.
Singh, who has been advocating for the Fund for years, said, “The responsibility now lies with affluent nations to meet their financial obligations in a manner proportionate to their role in the climate crisis, which has been primarily driven by decades of unrestrained fossil fuel consumption and a lack of adequate climate finance delivered to the Global South.”
The COP28, witnessing highest ever participation of stakeholders in the history of conference of parties (COP), was on Thursday kicked off with a hope to successfully conclude the GST of climate actions taken by all the countries so far and make a clear roadmap to triple global renewable energy capacity by 2030, besides mobilising required climate finance. The GST will become the basis of a new set of climate action targets which are to be submitted by countries by 2025.
The UAE will host three high-level events focused on GST, covering mitigation, adaptation, and the means of implementation of various climate actions, at the two-day WCAS which has been called during the first week of COP28 to give a political momentum to the annual climate conference at a time when the world is quite divided on the issue of Israel-Palestine conflict in Gaza.
After addressing the Summit, Prime Minister Modi will participate in three special events including on climate finance, Green Credit initiative and LeadIT (leadership for industry transition). “COP28 will also provide an opportunity to review progress made under the Paris Agreement, and chart a path for future courses on climate action,” said Modi in his departure statement ahead of his visit to UAE. He said, “It is important that efforts of the developing world be supported with adequate climate financing and technology transfer. They must have access to equitable carbon and development space to achieve sustainable development. India has walked the talk when it comes to climate action. Our achievements in different sectors like renewable energy, energy efficiency, afforestation, energy conservation, Mission LiFE are testament to the commitment of our people towards mother Earth.”