This is a watershed year for loss and damage, but will we grasp the opportunities?

Ongoing Conference of the Parties (COP) negotiations on the loss and damage fund offer hope, but the fund will not deliver on its promise if it is hamstrung or restricted, argues Practical Action’s Colin McQuistan.

We have seen temperature records broken in Thailand and Bangladesh. I have spoken with people in both countries and what struck me in our conversations was the unexpected nature of this heat. Clearly, climate change is with us and manifesting in more intense and unexpected ways.

The UN Intergovernmental Panel on Climate Change’s sixth assessment report catalogues for the first time the losses and damages that are occurring as a result of our collective failure to mitigate greenhouse gas emissions, and the total inadequacy of efforts to adapt to the resulting climate change. But the idea of loss and damage is not new.

The history of loss and damage in climate negotiations

Loss and damage were first introduced to the UN climate negotiations around 1991 when Vanuatu – on behalf of the Alliance of Small Island States – proposed creating an insurance scheme for countries likely to be impacted by rising sea levels. Sadly, this initiative was unsuccessful, as early climate negotiations were dominated by emissions mitigation to the exclusion of both adaptation and loss and damage. However, a gradual reckoning of the slow progress being made, and the realisation that climate extreme events were hitting harder and more frequently, provided the long overdue wakeup call that was needed.

The watershed moment came at COP19 in Warsaw in 2013. Typhoon Haiyan (also known as Super Typhoon Yolanda) was wreaking havoc on the people and economy of Tacloban in the Philippines, and this finally convinced the negotiators that action was required. That year, the COP established the Warsaw International Mechanism to address loss and damage associated with the impacts of climate change. The mechanism had three functions. The first was to enhance knowledge and understanding of risk management approaches to loss and damage. The second was to strengthen coordination between countries, and the third was to enhance action and support for countries experiencing climate-related loss and damage. But despite some progress on the first two functions, the third function stalled, especially in relation to financial support.

The awakening at COP25

After COP19 there was plenty of talk but little progress on loss and damage. It took six years of hard work from campaigners and a few dedicated climate justice-orientated negotiators to highlight the lack of progress and mobilise a change. Their hard work coincided with gathering global evidence of climate disasters. Combined, it led to a leap forward.

In 2019, at COP25 in Madrid, the negotiations agreed to establish the Santiago Network on Loss and Damage, a mechanism to connect developing countries with providers of technical assistance to avert, minimise and address loss and damage. This has great potential, but we must learn from the mistakes of the Green Climate Fund (GCF) and ensure that local community organisations and local experts, those who understand the local context and local solutions, are prioritised to deliver this technical assistance. Under the GCF, local organisations have struggled with accreditation, been unable to meet certain financial and governance requirements and lack the skills to write proposals. If the Santiago Network is to work, these barriers must be overcome and an inclusive approach to delivering technical assistance must be unlocked.

The loss and damage fund

The momentum on loss and damage was maintained after Madrid, despite a global pandemic. At COP26 in Glasgow in 2021, although a motion to establish a loss and damage fund sadly failed at the eleventh hour, the compromise agreement to talk about loss and damage finance under the Glasgow Dialogue placed a spotlight on the sincerity of the global community to deliver. Sadly, the resulting dialogue, held in June 2022, repeated previous work and failed to make real progress. But this provided the incentive and additional momentum for negotiators and civil society to push for a breakthrough agreement on a new loss and damage fund at COP27 in Sharm El Sheikh.

What and where next?

The loss and damage fund has raised expectations that could overshadow the shape of climate diplomacy for the year ahead, but we must put this into perspective. While recognising that finance for loss and damage is urgently required, COP28 must ensure that this fund is delivered while maintaining progress on the other threads of the negotiations, such as mitigation, adaptation and climate finance.

To make progress on the loss and damage fund a major challenge will be where this new and additional money comes from. But this won’t be the first hurdle for negotiators to navigate. Rather, the initial challenge will be separating the loss and damage fund from the wider, largely inadequate, funding landscape for global development. We know what incremental and business-as-usual success will look like. It will secure additional millions for the humanitarian system and for disaster risk reduction. This is much needed and will help, but it will not address loss and damage. This approach will not fundamentally change the way we do development and thus will not address the underlying and interlinked drivers of vulnerability and climate impacts.

To tackle the climate emergency, we need a transformation of the global system at a scale and pace that is scary. Many might say this is impossible, but for future generations, we have to find a way. The ongoing negotiations of the loss and damage fund offer hope, but not if it is hamstrung or restricted, and limited to a few tweaks of the global development finance architecture, rather than the whole scale and wide-ranging reforms that are desperately needed. To address loss and damage we will need to unlock billions if not trillions. This will require us to stretch our imaginations and grasp the impossible.