“Loss and damage” at COP27

Pakistan has a simple message for the world: “What happens in Pakistan doesn’t stay in Pakistan.”

The slogan has become a defining statement at COP27, where Pakistan is the poster child of “loss and damage”— a hot button issue that essentially says wealthy countries should compensate for climate damage caused by their emissions.

This year’s devastating floods in Pakistan have been directly tied to global warming and violent snow melts. Like many developing countries, Pakistan thinks the industrialized world should pay for some of the damages, and Western countries are open to that idea—to a limit. They fear limitless liabilities.

Germany’s Olaf Scholz came to Sharm el-Sheikh to is promote a “global shield” to protect poor nations, and offered €170 million to help build it. Britain’s new prime minister, Rishi Sunak, arrived at the desert town Monday in shirt sleeves and took a different tack, focusing on investment more than compensation. Britain, the U.S. and European Union are promoting a new concept, the Just Energy Transition Partnership, to help coal-burning countries invest in renewable power.

It’s all part of a broader agenda here to pressure the West to step up overall financial commitments to developing countries—a perennial failure. In 2009, at the Copenhagen COP, wealthy countries committed US$100 billion a year in climate finance by 2020—but continue to run about 20% short.

A highlight of Monday’s session was a surprise visit to the Pakistan pavilion by UN Secretary General Antonio Guterres, who travelled to the flood-ravaged country before COP and promised the its suffering would not be forgotten after. The pavilion was Guterres’ first stop, with Prime Minster Shebhaz Sharif at his side, after the Secretary General gave a blistering opening address and said the world is “losing” the climate fight.

He singled out the U.S. and China for not doing enough. That may not change any time soon. Joe Biden is expected to speak here on Friday—the question is who he‘ll be speaking for. Today’s midterm elections may declare him a lame duck president.

China is another challenge. Xi Jinping is not at COP27, nor is there much of a Chinese presence. One reason is China’s general retreat from the global stage, as Xi repositions his regime at home. Another factor is the possible liability that China could face from its emissions, which are growing.

The world’s two biggest economies—and biggest emitters—know the climate finance agenda won’t move without them. Nor will there be much progress on reparations.

As COP27 picks up speed, the political heat on them will only grow.