COP27: Countries commit fund to curb climate impact in vulnerable communities

• W’Bank designs new funding strategy for lowering emissions
• 4m Nigerians to benefit from UK’s £95m grants

More countries at COP27 have announced support for developing countries through direct finance to cope with unavoidable, devastating impacts of climate crisis.

Austria, yesterday, pledged $50 million for climate ‘loss and damage’, just hours after Scotland’s First Minister pledged an additional £5 million.

This means five European countries: Austria, Scotland, Belgium, Denmark and Germany have committed to fund the loss and damage finance mechanism.

The countries have committed various amounts of loss and damage funding, breaking ranks with other rich nations that have resisted such payments for fear of spiraling liabilities for their outsized contribution to causing climate change.

Germany, however, plans to make funding available based on its Global Shield Against Climate Risks insurance scheme. While there may be space for insurance for some climate costs, loss and damage needs sustainable funding from reliable sources.

Among other issues, high premiums can create large gaps in coverage, with studies finding that, overall, poorer countries benefit less.

Loss and damage is the irreversible climate-related devastation that cannot be mitigated or adapted to. Dealing with it is pushing developing countries into ever-greater debt and their economies to the brink of collapse.

The African Development Bank reported in September that the continent is losing between five per cent and 15 per cent of its growth in gross domestic product per capita each year because of climate change.

Last year, at COP26 in Glasgow, UK, low and middle-income countries jointly proposed a Loss and Damage Finance Facility. Wealthy countries rejected this, and instead offered a three-year ‘dialogue’.

The Chair of the Least Developed Countries’ Group on Climate Change, Madeleine Diouf Sarr, had called on governments to establish a loss-and-damage fund for developing countries during COP27. Research estimates that $290 billion to $580 billion per year will be needed by 2030.

“Those most responsible for global warming also have the greatest capacity to take action. Although the world’s richest 10 per cent of people cause 50 per cent of emissions, they also claim 52 per cent of the world’s wealth; the poorest 50 per cent contribute around 10 per cent of global emissions and receive about eight per cent of global income,” she said.

The most widely supported threshold for adequate loss and damage finance stands at around $1.3 trillion per year – a threshold announced last year at COP26 in Glasgow. There is clearly a huge gap between the promised funds and what is required to ensure that the most vulnerable communities around the world get the support they deserve to manage the climate crisis.

Global Campaigns Director at 350.org, Agnes Hall, said: “We welcome the pledges from Austria and Scotland to fund the most vulnerable nations’ responses to unavoidable climate impacts. As Europeans, we have a historic responsibility to provide support and solidarity.

“The deep inequalities between nations, and the vast difference between the carbon emissions of countries in Europe and North America and countries in Africa, Asia and South America, have their foundations in a long history of unfair treatment. However, to right those wrongs, European nations need to do much more in Sharm El-Sheikh and beyond.

“Confidence has already been undermined in the governments of the wealthiest countries – they have already failed to fulfill a promise of $100 billion climate finance per year to help poorer nations adapt to a rapidly changing climate. So, there is a lot of ground to make up, to restore trust. It is time to acknowledge the mistakes of the past and act with common decency/humanity.

“ To start this, more European nations need to step up with concrete financial commitments for Loss and Damage, and the EU bloc needs to ensure that the faulty mechanisms and processes for delivering finance under this umbrella are fixed over the next two weeks, and establish a Loss and Damage Response Fund,” she said.

MEANWHILE, the World Bank has unveiled a new initiative tagged, ‘Scaling Climate Action by Lowering Emissions’ (SCALE) partnership, aimed at providing grants for verifiable emissions reductions and expanding funding sources for global public goods.

This came as about four million Nigerians are slated to benefit from the United Kingdom’s new Propcom+, which will help over four million Nigerians, including two million women, to increase productivity and adapt to the effects of climate change, while at the same time reducing emissions.

The Bretton Wood institution said the new multi-partner initiative will pool funding from the global community – including donor countries, the private sector and foundations – for scalable pathways to greenhouse gas emission reduction.

Unveiling the initiative at COP27, the President of the World Bank Group, David Malpass, said: “Climate finance needs major new mechanisms that pool funding from the global community to accomplish actual reductions in greenhouse gas emissions across the developing world.

“SCALE offers a key non-fragmented avenue for the global community to take action on climate change. The verifiable emission reductions created by SCALE and similar mechanisms will also be an important step toward building effective carbon credit markets.”

SCALE will deploy Results-Based Climate Finance where countries receive grant payments for achieving pre-agreed, verifiable results, drawing on 20 years of World Bank Group experience in this area.

It will further support countries to build a track record of generating emission reductions from impactful programmes and policies they can apply toward their national emission reduction targets.

ALSO, UK Foreign Secretary, James Cleverly, announced a new UK support worth over £100 million to developing countries to deal with climate change.

This new £95 million Propcom+ programme is set to help address key barriers to sustainable agricultural development in Nigeria.

A statement by the embassy of the UK in Abuja, yesterday, said: “It will support the development of climate-resilient agricultural policies, actions, and investments that deliver nutrition, increase productivity, adapt and build resilience while reducing emissions, and protect and restore natural ecosystems, for example, through the adoption and scaling of practices, such as heat and flood-tolerant crop varieties and integrated soil fertility management.”

The programme intends to work with Nigeria’s vibrant private sector on agriculture to also tackle some of the country’s underlying drivers of conflict and insecurity.

Cleverly explained: “The Glasgow Climate Pact gave the world the tools to limit the rise in global temperature to 1.5 degrees and build a secure and sustainable future. Now is the time for all countries to step up their action on climate change and deliver the tangible change needed. The UK will continue to play a leading role in this mission. The funding we have announced will support countries, which are facing the devastating impact of climate change, to adapt effectively.”

On his part, the UK Deputy High Commissioner in Lagos, Nigeria, Ben Llewellyn-Jones said: “Tackling climate change and biodiversity loss is a key UK international priority and we remain committed to supporting inclusive and climate resilient growth in Nigeria through the Propcom+ programme, which will build on successes and lessons from previous engagement and deliver on adaptation and resilience, and on nature for climate and people.”