As ever, the annual climate summit of the Conference of the Parties (COP) has centered on a few and highly conflictual issues. Most notably, loss and damage, and the financing of such, is for the first time included in the formal negotiations and highly advocated by low-income countries. Moving onto the final week of COP27, observers report that negotiations are moving ahead too slowly and too little, and that several knots need to be untied.
This year’s COP meeting in Sharm-El Sheikh in Egypt started per usual with heads of states convening for the World Leaders Summit. Joe Biden, encouraged by the midterm election results which soothed worries of US climate policy drawbacks, announced a new plan to cut methane emissions and supported the “Early Warnings for All Action Plan” drafted by the World Meteorological Organization. The plan aims at establishing warning signals for extreme weather and climate-related events, especially for the most vulnerable countries. French President Emmanuel Macron strongly emphasized the need for climate justice considerations in his speech and that “loss and damage” righteously should be discussed during the coming two weeks.
Abd al-Fattah al-Sisi, President of this year’s host country Egypt, has named this the “Implementation Summit”. He urged all parties to center their efforts towards implementing the rules agreed upon last year in COP26 in Glasgow.
Leading up to the summit, discussions were expected to concern financing and the previously precluded concept of “loss and damage”, as well as clean energy developments and climate adaptation. As expected, both formal negotiations and informal discussions have centered around these issues.
Money talks
Financing has been a cornerstone and stumbling block in the climate negotiations since the Paris Agreement in 2015. The failure to deliver the annual $100 billion by 2020, agreed upon in Copenhagen 2009, has come into light as poorer countries are increasingly devastated by extreme climate catastrophes. Such as the one in Pakistan earlier this year, leaving over 20 million people in need of humanitarian aid. The World Bank headed by president Malpass – who have been accused of climate denialism by former Vice President Al Gore – has come under increasing fire for insufficient climate financing as well as continued financial support to fossil fuel projects.
A partial success concerning climate finance from the first week was the tentative support for the “Bridgetown Agenda”, proposed by Prime Minister of Barbados Mia Mottley. The agenda seeks to reform the international financial system to ensure financial flows to low-income countries. It received support from French President Emmanuel Macron, with Germany and the UK tentatively supporting the idea. The Bretton Woods financial system managed by the World Bank and IMF is, according to Mottley, insufficiently structured to allow poorer countries to adapt to increasing climate-induced extreme weather events. With poorer countries being charged with substantially higher interest rates than the rich, Mottley argued that poorer countries should receive concessional lending, but also that discussions must include oil and gas companies, which in recent months have seen unprecedented windfall profits. “How do companies make $200 billion in profits in the last three months and do not expect to contribute $0.10 on every $1 of profit to a loss and damage fund?” she said. Success of the Bridgetown Agenda does, however, rely heavily on the support of the G7 countries who historically been reluctant to adopt concessional lending and debt cancellation policies.
US Climate Envoy John Kerry announced a plan to marshal investments in renewables in developing countries through a framework for carbon credits. The plan, dubbed the “Energy Transition Accelerator”, would allow private companies to gain carbon credits by investing in projects in developing countries. The initiative has not landed well amongst developing countries. Critics argue that another voluntary carbon market will neither instigate necessary deep emission reductions in richer countries nor ensure any additional funding – that would happen anyway – to clean energy developments.
Rich countries criticized for preventing loss and damage mechanism
The most contentious – but previously precluded from formal COP negotiations – issue is the financing of loss and damage arising from climate change calamities. Although discussions within the UNFCCC have been ongoing since COP19 with the establishment of the “Warsaw International Mechanism for Loss and Damage”, strengthened at COP25 with the Santiago Network and with the Glasgow Dialogue at COP26, progress has been slow. Securing hands-on financing is not expected in Egypt, but emphasis is directed towards settling on the mechanisms of such funding. One week into the negotiations, however, a few countries have pledged to provide loss and damage money. Scotland broke the ice, followed by Denmark, Germany, Belgium Austria and New Zealand. More countries are expected to follow suit and pledge to the loss and damage fund in the second week of the summit, but sums are still far from adequate. Concerning the loss and damage mechanism, progress is even slower. Rich countries, especially the G7, have been accused of distracting from establishing a mechanism by proposing the alternative Global Shield insurance scheme, aimed at establishing a protection scheme to account for climate catastrophes. This has not landed well amongst poorer countries. It is perceived as a way of circumventing the loud calls for a loss and damage mechanism. The Global Shield insurance scheme does not include slow onset events brought about by climate change and includes only a fraction of countries in need of loss and damage money.
Demonstrations and fossil fuel delegates
A worry leading up to the summit in Egypt has concerned the role of civil society groups and activists. The Egyptian regime, with a record of human rights abuses and mass imprisonment of civil society actors, have come under critical scrutiny and commentators have warned of regressive restrictions. The currently imprisoned Egyptian human rights advocate Alaa Abd el-Fattah has become a figurehead of demonstrations and campaigns. Although attempts to raise human rights issues have been made and demonstrations have taken place, civil society organizations have been largely smothered.
If civil society action has been much curtailed during the first week, the oil and gas industry has not. With over 600 oil and gas representatives participating at the meeting, according to official registration lists, they outnumber all delegations from African countries.
What to expect from the final week of negotiations
Moving onto the second week, informal discussions will center around a few topics that traditionally fall outside the scope of the COP summits, beginning with water scarcity and gender issues on Monday. On Tuesday, attention will be directed towards the role of civil society. Discussions on Wednesday will raise to the fore biodiversity issues, paving way for the UN Biodiversity (COP15) starting on 7 December in Canada, ending with “solutions day” on Thursday where prospects for novel solutions such as Carbon Capture and Storage (CCS) and hydrogen centers on stage.
Turning to the formal negotiations, government ministers have replaced government leaders in the pursuit of untying the knots from the first week. The most pressing issue being the loss and damage funding, and whether the funding mechanism or the insurance scheme proposed by the G7 countries will prevail. How these negotiations end will much likely define whether COP27 will be seen as a step forward or not, especially concerning the contested issue of accountability.
A conference draft of formal agreements is expected on Wednesday, but a final draft is not expected until the end of the week. As last year’s COP focused on keeping the 1.5C target alive, a year later, that ambition looks even bleaker. In the run-up to the negotiations several reports concluded that the target is slipping away. That it is politically unfeasible to keep the 1.5C target alive and that there is “no longer any credible pathway” to achieving it. The last-minute calamities and weakened commitments in Glasgow made Alok Sharma, President of COP27, tearfully claim that the 1.5C target was, albeit barely, kept alive. Egypt’s COP27 President Sameh Shoukry will face a similar task.