COP27: Is a step forward on climate justice worth the price of zero progress at emission reductions?

Early in the morning, exhausted negotiators in Sharm el-Sheikh finally reached a compromise agreement at COP27. So is this a successful ending to the annual climate conference? Will the richer countries compensate the poor for their losses and damages in the past decades? And what does this mean for our future climate on this rapidly warming planet?

As so often in multilateral diplomacy, the result is a mix of the satisfactory and the imperfect in a painfully slow process that should have dealt already decades ago with the alarming existential challenge of climate change. Yet, with all its flaws, COP27 made a small step in the right direction. And when so much is at stake, each small step is essential. But, unfortunately, the climate doesn’t sympathize with the challenges of finding a multilateral agreement on one issue; it relentlessly keeps heating our oceans and atmosphere. So more progress to stay below 1.5C is urgently needed.

Loss and damage

The most eye-catching decision was the establishment of a loss and damage fund. The UN secretary-general, Antonio Guterres, summarized it correctly: “Clearly, this will not be enough, but it is a much-needed political signal to rebuild broken trust. The voices of those on the frontlines of the climate crisis must be heard.”

The compromise agreement will, in the future, be referred to as a milestone in climate negotiations since it overcame decades of US and European reluctance to agree on the principle that wealthier countries contribute to compensating vulnerable nations for the harm caused by climate change.

I remember from the days I was more closely involved in climate policy how firm the western opposition to this idea was, often referring to the risk of rising future obligations. Although I realized it would be costly, I never understood the reasoning against the principle. I assume each of these negotiators arguing against compensation for damage caused wouldn’t wait a second to sue a driver who would damage their car. For years I have called for more climate justice, most recently in this interview on TRT World Television.

The term “Loss and Damage” looks like a phrase from the small print on your insurance policy, which is indeed what it looks like. It refers to expenses previously incurred due to weather extremes or impacts brought on by climate change, such as rising sea levels. The novelty in last night’s agreement is not the climate financing from rich countries to poorer countries. Although each year less has been paid than was promised, substantial funding has gone toward projects that reduce carbon dioxide emissions to slow global warming. About a third of it has been allocated to initiatives that assist communities in adapting to its effects.

Funding for loss and damage was until COP27 only very recently starting. It differs from the previous financing since it covers the damage and economic losses caused by climate change. Only a handful of countries, the EU, Denmark, Belgium, Germany, and Scotland, have contributed symbolic sums to cover loss and damage.

Waiting for thirty years

Poor nations that have experienced colossal climate change impacts have been calling for compensation since the agreement on the UN Climate Treaty (UNFCCC) in 1992. The devastating floods in Pakistan this summer, which killed about 1,700 people with estimated damages of $40 billion, served as a powerful reminder to all delegations in Sharm el-Sheikh how much is at stake.

Another indication of what’s at stake is provided in a report that 55 vulnerable nations presented last June. It estimated the total cost of climate-related losses over the past two decades to be $525 billion, or about 20% of their combined GDP. Some studies predict that by 2030, these losses might reach $580 billion yearly.

These vulnerable nations claim that wealthy countries should foot the bill because they were primarily responsible for climate change through historical greenhouse gas emissions. The European Union and the United States have, until recently, rejected this argument. But the EU changed its position during the COP27 negotiations and said it would support a fund under certain conditions. One of these is that China, which the UN still deems a developing nation even though it has by now the second-largest economy in the world, contributes to it. In the year until the next COP, countries will have to negotiate the details of loss and damage funding, like where the money should come from and how to decide which countries are eligible to receive loss and damage compensation.

But where is the progress on emissions?

However vital this decision may be, we should never lose sight of the fundamental challenge to stop climate change. When a house is on fire, issues like insurance, future rebuilding, the ‘whodunit’ question, or alternative housing for the residents are all critical. But the house will burn down to the ground if the fire is not extinguished. We have many climate action priorities, and stopping the greenhouse gas production that causes it should always be a top priority.

Unfortunately, that’s where COP27 didn’t deliver. Beyond loss and damage, the final agreement was a glaring letdown for those hoping to ramp up the goals of last year’s Glasgow accord. The pledge to phase down unabated coal emissions was not expanded to encompass all fossil fuels in the declaration, and there was no mention of the peaking of global greenhouse gas emissions in 2025.

The European Commission’s climate director Frans Timmermans had offered a grand bargain on loss and damage in exchange for greater carbon ambition. But, unfortunately, it looks like the deal didn’t work out in the negotiations where some countries even wanted to scrap the 1.5C Paris target and tried to get rid of the Glasgow requirement that nations update their emission targets annually.

Homework for COP28

Every COP sends the delegations back home with homework for the next one. This time it’s not different, and much attention will go to the loss and damage fund. Next year, when the 1.5C target of Paris will get uncomfortably close to our rapidly warming planet, the COP will meet the United Arab Emirates in November 2023. An oil-producing state with one of the highest carbon footprints in the world. This year, the number of delegates with links to fossil fuels at COP27 was 25% higher than the year before. More than 600 people at the talks in Egypt are linked to fossil fuels, more than the combined delegations from the ten most climate-impacted countries. They know Abu Dhabi well and may come in an even stronger force next year.

Oh, and since one reader asked: I was asked to join COP27 but declined since I try to fly less, it seemed the best contribution I could give to the COP was just staying at home. I wonder if any of these 600 oil representatives ever took a second to think about that option.

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