The South needs new loss and damage funds, not rebadged climate finance, aid

You are currently viewing The South needs new loss and damage funds, not rebadged climate finance, aid
  • Post author:
  • Post category:News

Statement on new loss and damage finance pledges of NZ, Austria, and Ireland

Sharm El-Sheikh, November 10 – On November 9, New Zealand announced a USD 12 million pledge to deal with the impact of loss and damage caused by climate change. The country has joined Ireland and Austria which have all committed between USD 5 to USD 50 million to help developing countries recover from extreme weather events and address the impacts from slow onset climatic processes.

These pledges underscore that the fight for loss and damage finance is gaining political momentum and that developed country governments can no longer sweep their accountability under the rug. A cursory glance at these pledges, however, reveals that these are not new and additional but merely rebadged from developed countries’ existing climate finance commitments.

New Zealand’s USD 12 million loss and damage pledge comes from a portion of the USD 1.3 billion in climate finance that the government already announced in Glasgow in 2021. Similarly, Ireland’s USD 10 million pledge for loss and damage will be from the country’s existing support for climate adaptation and mitigation in developing countries. The amount will also be going towards the “Global Shield” initiative which will see Ireland subsidising Northern-owned insurance corporations and the frontline communities paying insurance premiums.

Austria’s loss and damage pledge also requires closer scrutiny. A recent civil society study shows that only around half of the Austrian government’s total climate finance for 2011 to 2018 was additional to the amount it contributed in 2009, the year of the COP15 climate finance commitment. Of the total, 33% are non-concessional money.

Dividing up already inadequate levels of support for climate action means further delaying the adaptive capacity of climate-vulnerable communities and sectors. Rebadging official aid as loss and damage finance will further fragment and shrink the already paltry resources going towards economic development and welfare of developing countries.

Recent estimates show that the loss and damage in developing countries alone will cost between USD 290 billion and 580 billion annually by 2030. Given the scale and scope of needs, new and additional climate finance for loss and damage is critical and developed countries must contribute their fair share.

Developed countries must demonstrate their commitment by supporting the call for a dedicated loss and damage finance facility at COP27. This will help ensure sustained, predictable, grants-based assistance to those most affected by the overlapping climate, economic, and ecological crises.

The delivery of new and additional loss and damage finance could make or break COP27. Failure to act is not only a grave injustice. It will rob frontline communities of their most basic human rights, including the right to development and decent livelihoods for themselves and future generations. ###

Reference: Ivan Enrile, IBON International Climate Justice Programme Manager +639615005895