Victims of flooding from monsoon rains carry belongings salvaged from their flooded home in the Dadu district of Sindh Province, Pakistan (Fareed Khan/AP)
(Picture: AP)Before the conference in Egypt had even officially begun, COP27 delegates found themselves arguing late into the night over one issue on Saturday – “loss and damage”.
The phrase refers to the cost, both economic and physical, that developing countries are facing from the extreme impacts of climate change. Many of the countries and communities that have contributed least to greenhouse gases heating the planet are the ones suffering the most – and are least equipped to cope with the death and destruction.
After a year where extreme rainfall left a third of Pakistan under water, and 37 million people facing drought-induced starvation in the Horn of Africa, developing countries are asking for wealthier nations to help them pay for the harm caused.
With Egypt hosting this year’s UN climate conference, it’s not surprising that loss and damage will take centre stage.
But what does loss and damage mean, and why is it so controversial?
What does ‘loss and damage’ mean?
In climate-change terms, “loss and damage” refers to the irreversible costs already being incurred from climate-fuelled extreme weather events and natural disasters, such as hurricanes, droughts, wildfires, and melting glaciers.
It is about holding the biggest fossil-fuel polluters – who are also the wealthiest countries – accountable for the damage and destruction already being experienced in poorer countries. It is also about securing climate finance for mitigation and adaptation, to help these nations prepare for further disruption.
Rich countries, including the US, Canada, Japan, and much of western Europe, account for just 12 per cent of the global population today but are responsible for 50 per cent of all the planet-warming greenhouse gases released from fossil fuels and industry over the past 170 years.
Over that time, the planet has heated up by roughly 1.1 degrees Celsius, fueling stronger and deadlier heatwaves, floods, droughts, and wildfires. Poorer, vulnerable countries have asked richer nations to provide more money to help adapt to these hazards.
Climate-change funding so far has focused on cutting carbon emissions in an effort to curb climate change, while about a third of it has gone towards projects to help communities with future impacts.
Loss and damage funding would be different – it would be about compensating costs that countries can’t avoid or adapt to.
There is no agreement yet over what should count as “loss and damage” in climate disasters. Economic costs could include livelihoods, houses, territory, and farmland which are irreversibly lost. Harder-to-value losses could also include loss of lives, cultural sites, identity, sovereignty, and human dignity.
Why is it so important?
The debate around loss and damage is a question inherently of equity – why should countries that have done little to cause global warming be responsible for the damage resulting from the emissions of wealthy countries?
At this year’s UN general assembly, the UN chief, António Guterres, described loss and damage as a “fundamental question of climate justice, international solidarity, and trust” – adding that “polluters must pay” because “vulnerable countries need meaningful action”.
It has been a long-standing point of negotiation at UN climate conferences, held nearly every year since 1995, but there has been little progress towards including a financial mechanism for these payments in international climate agreements.
Developing countries need five to 10 times more international adaptation finance than wealthier countries are providing, according to the UN Environment Program’s Adaptation Gap Report.
Because the definitions of loss and damage are broad, it’s hard to calculate exactly how much money loss and damage would entail. One frequently cited study estimated that developing countries could suffer $290 billion to $580 billion in annual climate damages by 2030, even after efforts to adapt. That could rise to $1.7 trillion by 2050.
Why is it so contentious?
The loss and damage debate has been contentious within international climate negotiations because of questions of fairness and equity, and proving historical responsibility for climate change.
Unsurprisingly, developed countries have been pushing back against the idea of loss and damage since it emerged in the early 1990s.
At COP26 in Glasgow last November, Scotland’s first minister, Nicola Sturgeon, promised £2m as a one-off loss and damage payment, apparently hoping that other rich countries might follow suit. They did not.
But the pressure for them to do so is increasing. Last month, ministers from a negotiating alliance of 46 countries, known as the Least Developed Countries, called the creation of a financial mechanism for loss and damage a “fundamental priority” for COP27.
Some wealthy countries also say China, currently the world’s largest emitter, as well as fossil-fuel exporters like Qatar and Saudi Arabia, should contribute. This could lead to major disputes, as these countries have not traditionally been held responsible for climate aid.
Even if nations agree, at least in principle, to create a loss and damage fund, they will have to wade through difficult issues: Who deserves help and how much? And how do you guarantee money is spent in ways to benefit people who most need it?
