The agenda sets a 2024 deadline to deliver a plan on loss and damage, but does not mention any dedicated facility for finance.

COP27: Loss and damage on final agenda, but dedicated funding facility still a distant dream for Global South

After long discussions, loss and damage has finally made it to the COP27 agenda, but there’s still a long way to go, say experts

COP27 started with a delay as discussions on the agenda overran into Sunday morning, with delegates disagreeing on the inclusion of loss and damage. The 20-point official agenda has now been finalised and includes loss and damage for the first time.

Aniruddha Dasgupta, president and CEO, World Resources Institute (WRI), said, “We applaud the Egyptian presidency for accelerating this discussion to start the climate negotiations in Sharm El-Sheikh on the right foot. It is encouraging that countries agreed to a verbal statement that notes this process will reach a conclusive decision on funding arrangements within two years. Now, negotiators need to set clear markers to ensure this process moves quickly, ideally concluding by next year given the urgency of the crisis.” 

The agenda sets a 2024 deadline to deliver a plan on loss and damage, but does not mention any dedicated facility for finance. It avoids any discussion on compensation & liability. 

“We need to see the loss and damage funding facility agreed here in Egypt with the funding arrangements then worked out over the next two years. As things stand, we will have no facility and no assurances that negotiations over the next two years will result in a facility. Without that, there’s no way we can say this summit will deliver for the world’s vulnerable people.  In order to be a success, this ‘African COP’ needs to ensure the interests of the world’s poorest and most vulnerable people are met.  Without a clear path forward on loss and damage here in Egypt it will not do that,” said Mohamed Adow, director, Power Shift Africa.

A new loss & damage fund by 2024 is the “bare minimum”, according to the 39-strong Alliance of Small Island States. But there will be more roadblocks ahead. The US, for example, has suggested it could back loss and damage support, but only if China also came on board, the changes of which are highly unlikely. 

Expressing his doubts, RR Rashmi, distinguished fellow, The Energy and Resources Institute (TERI) said, “The inclusion of the loss and damage issue in the COP as an item on the agenda is welcome, but this is clearly linked to the outcomes in CMA [Conference of the Parties serving as the meeting of the Parties to the Paris Agreement]. In CMA, the discussion will only focus on the Warsaw mechanism, not the financing facility or the window. So one has to keep one’s fingers crossed on whether this will actually result in an ambitious outcome.”

Other developments: Carbon removal, rainforests and food systems

The debate will continue at COP27 on what counts as emissions removal in the new body created under Article 6 (6.4) to set the rules for the new carbon market. The latest version of the text lacks detail, especially on definitions around the longevity of a removal. These details are crucial because offsets keep getting tossed around as a way of enticing private finance to the climate action table. 

The UN Economic Commission for Africa (UNCA) and Sustainable Energy for All are looking to push for private finance for African energy. African ministers are likely to discuss this on Tuesday. Heading the African Energy Chamber—which has teamed up with UNCA for the plan—is NJ Ayuk, who has previously stated that Africa’s message to the world should be, “drill, baby, drill”

The Koronivia Dialogue will be the main forum to discuss food systems and action. But parties failed to come to a consensus on the text to discuss. The Koronivia Joint Work on Agriculture (KJWA) focuses on agriculture’s potential to tackle climate change. This is an important piece of the climate puzzle because food systems represent 30% of GHG emissions. The Dialogue’s mandate ends this year, so there has to be some concrete direction set for it at COP27, or a large chunk of emissions will remain unscrutinised.

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