COP27: Payment for ‘loss and damage’ finds way in last minute climate deal


With the issue of ‘loss and damages’ taking the front seat at the COP27 summit, it posed a great difficulty for scores of negotiators to reach a common ground for this year’s climate deal. Delegates from developed and developing nations went head to head over the language of the draft trying to find a text that will satisfy almost 200 nations.

A historic last-minute agreement was reached to compensate poorer countries for the harm caused by global warming caused by the developed world. The proposal directs to create a new fund for the cost of climate disasters in the year to come.

The deal appeared close to collapse on Saturday morning with threat from EU climate chief Frans Timmermans to walk out of the negotiations. At the summit, he has been a driving force behind efforts to advance through a grand bargain that would trade a tougher stance on emissions for the promise of loss and damage compensation.

“The EU is united in our ambition to move forward and build on what we agreed in Glasgow,” Timmermans said, flanked by a group of European energy ministers. “Our message to partners is clear: We cannot accept that 1.5C dies here and today.”

Negotiators worked to craft language that would satisfy European demands for more aggressive climate change mitigation as evening negotiations continued. However, delegates reported that a number of nations, including Saudi Arabia, Brazil, and China, were fighting to weaken the text.

The addition of a line that guarantees funds will only go to the most vulnerable countries, like small island states and least developed countries, represented the breakthrough on ‘loss and damage’. The text also makes a reference to other nations, like China, possibly helping to solve the issue.

The latest draft of the text did not include the European demand that global emissions peak by 2025 or a commitment to phase out all fossil fuels, but work was still being done to find language that could allay European concerns.

The latest text, according to the UK, an important ally of the EU on climate change, “threatens to take climate action backward from Glasgow,” suggesting that mitigation progress must be made before Europe can sign the agreement.

“The text right now does not go beyond Glasgow and it doesn’t even take us to Glasgow,” said Alok Sharma, the UK’s lead negotiator, who was president of last year’s COP in the Scottish city.

Still, the deal on loss damage pleased African delegations, which had set securing promises on compensation before the summit started. 

Ephraim Mwepya Shitima, the chairman of the African Group of Negotiators said, “It is a victory, not only for Africa, but for developing nations. We will be going back smiling.”

South Africa’s environment minister, Barbara Creecy, said the payments could become significant in time.

“Loss and damage can potentially take an enormous amount of funding. The purpose of allowing another year so that further sources of funding and financing can be identified,” Creecy said in an interview.

(With inputs from Bloomberg)

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