CLIMATE ADAPTABILITY: LOSS AND DAMAGE FUNDS

INTRODUCTION

As a crucial first step towards achieving climate justice, Greenpeace applauded the COP27 agreement to create a Loss and Damage Finance Fund, while cautioning against politicising same.[1] According to Yeb Sao, Executive Director of Greenpeace Southeast Asia and leader of the organization's delegation at the COP, the establishment of a Loss and Damage Finance Fund heralds a new era in climate justice.[2] Governments have officially launched a long-overdue novel fund that will provide critical assistance to communities and countries that are already suffering the effects of the escalating climate crisis.[3] Yeb Sao further mentioned that Greenpeace must ensure that the nations and businesses most accountable for the climate disaster should contribute the most, before moving on to discussions on the Fund's specifics.[4] Furthermore, he noted the key point that poor nations and communities who are vulnerable to the effects of climate change will need new and additional funding for both adaptation and mitigation in addition to loss and damage and further stated that developed nations must fulfill their current commitment of $100 billion annually to help low-income nations implement carbon-reduction measures and strengthen their ability to withstand the effects of climate change.[5] There must also be a follow-through on promises to at least increase the amount of funding for adaptation.[6]

CLIMATE ADAPTABILITY: LOSS AND DAMAGE FINANCE FUND

There is no agreed-upon definition of loss and damage within the UN Framework Convention on Climate Change (UNFCCC), and the terms signify various meanings to different parties. Nonetheless, loss and damage can be broadly regarded as the negative effects of climate change that occurs irrespective of, or without, mitigation and adaptation.[7] Loss and damage are frequently divided into economic and non-economic categories. Negative impacts that have a premium are considered as economic loss and damage. Examples of these include the cost of rebuilding infrastructure damaged by a flood or the money lost from crops destroyed by drought.[8] Non-economic loss and damage are negative effects that are impossible or difficult to put a price on. These include trauma brought on by tropical cyclones, community loss brought on by mass migration, or biodiversity loss.[9]

Climate adaptation methods are needed to stop these scenarios and reduce the effects of climate change.[10] Rather than attempting to slow or stop climate change, adaptive solutions focus on adapting to the effects while minimizing further negative impacts, as opposed to mitigation strategies that aim to halt climate change by utilising measures that reduce the Greenhouse gases that are emitted into the atmosphere.[11] The emphasis on adopting proactive measures and developing climate adaptation techniques has grown significantly, as people become more aware of climate change and the accompanying threats.[12] The ultimate objective is to establish protection for populations and ecosystems: this ought to increase climatic adaptability.[13]

Some adaptive measures against climate change include adopting landscape design, buildings and infrastructure that contribute little to no emissions, developing action plans for climate emergencies, etc.?All of these and more will require funds that most developing/vulnerable countries to climate change do not possess. To help developing nations respond to loss and damage, the ground-breaking decision to create new financial arrangements and a dedicated fund was made at COP27; accompanied by the decision to constitute a "transitional committee" to advise on how to operationalize the new financial arrangements and the fund at COP28.[14] It has been suggested that the committee should provide proposals against COP28, to operationalize the financial arrangement which will serve as a crucial framework for the disbursement and mobilisation of the funds.[15]

Additionally, the parties agreed to establish institutional arrangements, modalities, structures, governance, and terms of reference for the fund, define the components of new funding arrangements, identify, and increase funding sources, and ensure that new funding arrangements are coordinated with and complement existing arrangements[16]. The parties reached an agreement on the institutional framework for the Santiago Network for Loss and Damage, which will be implemented to provide technical aid to developing nations that are particularly susceptible to the negative consequences of climate change.[17] ?

LOSS AND DAMAGE CONSIDERATIONS

For many developing nations, raising money to deal with loss and damage as a climate change adaptation measure is a top priority, based on the UN climate negotiations. Although the issue has acquired more political traction recently, it is still divisive and complicated[18]. The Loss and Damage Finance Agenda needs to move forward to satisfy the needs of impacted populations and to rebuild confidence between developed and poor nations in climate negotiations.[19] Developing and developed nations alike may experience increased security because of improving the global response to loss and damage.[20]

The challenging aspect of the loss and damage fund is the need for organisation and financing. For institutional mechanisms and governance to be clarified, and new financing sources found and developed, the following factors put forward by United Nations Development Programme should be considered:[21]

·??????Quantification: The amount of loss and damage that each country will incur is the first thing to be determined. Will funds evaluate annualized losses, aggregated losses over a certain baseline, or accumulated damages?[22]?

·??????Assessment: How will loss and damage be quantified and qualitatively assessed? How should accounting for irreparable damages be handled? How will the loss of national and local ecosystems, or the loss of Indigenous cultural heritage be evaluated?

·??????Countries must be helped to monitor and explicitly define attribution. Given that the effects of climate change are already being witnessed across landscapes, what baselines will be agreed upon for attribution of loss and damage?

·??????Payment tracking: A fund requires management and capitalization. Once the mechanics of the fund have been established, it is necessary to examine the necessity of an impact monitoring system and evaluate and verify allocations to make sure monies are allocated to initiatives that advance social, economic, and environmental conditions.

?CONCLUSION

Climate justice has entered a new era with the creation of the Loss and Damage Finance Fund. Governments have officially launched a long-overdue novel fund to provide critical assistance to communities and countries already suffering the effects of the escalating climate disaster. Existing climate funds should be studied for lessons on how to direct private capital towards low-carbon investments and a variety of funding mechanisms must be added to the fund to provide appropriate support to nations dealing with the most severe effects of climate change.

[1] COP27 Loss and Damage Fund a down payment on climate justice: Greenpeace, available at https://dailynewsegypt.com/2022/11/22/cop27-loss-and-damage-fund-a-down-payment-on-climate-justice-greenpeace/

[2] Ibid

[3] Ibid

[4] Ibid

[5] Ibid

[6] Ibid

[7] https://www.un.org/en/climatechange/adelle-thomas-loss-and-damage

[8] Ibid

[9] Ibid

[10] https://www.studysmarter.co.uk/explanations/geography/energy-security/adaptation-strategies/

[11] Ibid

[12] Ibid

[13] Ibid

[14]COP27 Reaches Breakthrough Agreement on New “Loss and Damage” Fund for Vulnerable Countries, available at https://unfccc.int/news/cop27-reaches-breakthrough-agreement-on-new-loss-and-damage-fund-for-vulnerable-countries

[15] Addressing loss and damage finance: It’s more than money, available at https://www.thedailystar.net/opinion/views/news/addressing-loss-and-damage-finance-its-more-money-3177411

[16] Ibid

[17] COP27 Reaches Breakthrough Agreement on New “Loss and Damage” Fund for Vulnerable Countries, available at https://unfccc.int/news/cop27-reaches-breakthrough-agreement-on-new-loss-and-damage-fund-for-vulnerable-countries

[18] Loss and Damage finance in the climate negotiations, Available at https://www.chathamhouse.org/2022/11/loss-and-damage-finance-climate-negotiations

[19] Ibid

[20] Ibid

[21] https://www.undp.org/blog/what-new-loss-and-damage-fund-needs-success

[22] Ibid