Funding assistance for climate economic disasters is on the cards as South Africa’s Minister of Forestry, Fisheries and the Environment, Barbara Creecy, yesterday welcomed the operationalisation of the Loss and Damage Fund – a historic milestone in the multilateral climate negotiations.
South Africa has lost billions of rand over the past few years as the country has been ravaged by floods in Durban, KwaZulu-Natal, with Cape Town recently the latest casualty.
COP28 president Dr Sultan Al Jaber at the weekend announced the successful conclusion of a significant UN Framework Convention on Climate Change (UNFCCC) meeting related to the implementation of the Loss and Damage Fund.
Once up and running, the fund will provide particularly vulnerable countries, many at extreme risk from climate change, with funding to support recovery from the impacts of climate change in response to economic and non-economic loss and damage associated with those harmful effects, including extreme weather events and slow-onset events.
The agreement on the recommendation comes only weeks ahead of the 28th Conference of the Parties of the UNFCCC in Dubai.
Creecy noted that developing countries, Africa in particular, had borne the brunt of the adverse effects of climate change and had not received the required multilateral support to face the climate challenge, including for addressing loss and damage.
The projected economic cost for loss and damage by 2030 alone has been estimated to be between $290 billion and $580bn (R11 trillion) in developing countries alone. By 2050 the economic cost for loss and damage in developing countries is estimated to be between $1 trillion to $1.8 trillion.
The delivery on the Sharm El-Sheik COP27 decision to operationalise a new fund for loss and damage in the context of the scale and increasing severity of loss and damage impacts in the near-term scenario of temperature increase to 1.5 degrees or above. Loss and damage is generally defined as the impacts of climate change which are not avoided by mitigation, adaptation and other measures, such as disaster risk management.
The new Loss and Damage Fund will have a board, balanced between developed and developing countries, and will take its guidance from the parties to the UNFCCC and Paris Agreement.
“The final approval of this agreement at COP28 presents the international community with a critical global solidarity moment to ensure the fund is capitalised at a scale necessary to respond to the costs and impacts already borne by developing countries,” Creecy said.
“South Africa urges the COP28 presidency to launch a process for the initial core capitalisation from developed countries supplemented by financial inputs from a variety of other sources in line with the principle of common but differentiated responsibilities. It must also engage with all other relevant actors to support aligning their efforts to leverage the impact of the fund in addressing loss and damage,” the minister added.
The announcement comes as the UN warned yesterday that plans to expand oil, gas and coal production by major fossil fuel countries would push the world far beyond the Paris deal’s 1.5C global warming limit, Reuters reported.
Most of the world’s leading producers of fossil fuels have pledged to achieve “net-zero” emissions by mid-century – a target that should align with the Paris Agreement’s aims to limit global warming to well below 2ºC since the pre-industrial era, and preferably a safer 1.5C.
But the annual United Nations Environment Programme (UNEP) Production Gap report makes it clear that the production plans of the top 20 producing countries – including the US, China, Russia, Australia and COP28 host United Arab Emirates – are heading in the opposite direction.
Overall it found that governments’ plans would produce 110% more fossil fuels in 2030 than would be consistent with limiting warming to 1.5C, and 69% more than would be consistent with 2C.
“Governments’ plans to expand fossil fuel production are undermining the energy transition needed to achieve net-zero emissions, throwing humanity's future into question,” said Inger Andersen, UNEP’s executive director.
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