Deadlock on L&D Funding: Developed Countries Paying Lip Service to Climate Action

The fourth meeting of the Transition Committee for the operationalisation of the Loss and Damage Fund ended in Aswan, Egypt with no clear resolutions on key issues especially where the Loss and Damage Fund( agreed to in COP27, at Sharm el-Sheikh) would be domiciled. From 17-20 October, 2023, developed countries led by the United States of America held their ground, insisting that the must have total control over this fund, which they say is being established for developing countries.

Many experts including Harjeet Singh, the Head of Global and Political Strategy of the Climate Action Network (CAN) saw this resolution as a complete disappointment.

This insistence by the U.S and her allies is nothing short of an attempt to exert control over developing countries. By trying so hard to force developing countries to accept that the Loss and Damage Fund must be domiciled within the World Bank— an institution long seen by developing countries as serving the interests of developed countries— developed countries led by the United States and Switzerland have once again showed that for them, climate action is not about justice and corrections of the mistakes of the past, but more about them exercising powers over anything and everything in the world.

Historically, emissions by developed countries created the climate crisis. Furthermore, those emissions were used by developed countries to boost their technological progress giving them an advantage when it comes to control and access to finance and technologies needed to cut down emissions. Having exploited the common resources of the entire world to get to this point, it is only a fair that they should support poor countries who are bearing the impact of the climate crisis to grow in a more sustainable way.

Nonetheless, these countries have continuously refused to make the basic compromises required to build trust in the international process and encourage developing countries to pursue low-carbon development. First, they failed to meet the $100bn annual support agreed to in 2009 to assist developing countries by 2020, next they tried to pass off high interest loans as part of the effort to meet the $100 billion pledge. And Now, this bull-headed decision to have control of the Loss and Damage Fund with the usual conditions to make sure that access becomes extremely difficult for those who need adds salt into the wounds of developing countries.

Let us be clear, the funding expected from rich countries either as part of the Green Climate Fund, Adaptation Fund, or the Loss and Damage Fund, should not be viewed as charity. Instead, they are essentially tokens from massive profits made by developing countries from destroying the earth. It is as simple as that. While the language of compensation is not explicitly used in the UNFCCC texts, that is essentially what it is, and the fact that poor countries agreed to expunge compensation language from the text is already enough demonstration of compromise and good will by the Global South.

Confronted with the stark reality of climate change, and constantly reminded by developed countries that they must take action to address climate change, developing countries have since committed to follow the low-carbon development path hoping that those who destroyed the earth would at least live up to their own words and provide the agreed financial support necessary to encourage mitigation and adaptation efforts, and also support for Loss and Damage. Yet, all poor countries continue to get are warm words and empty promises.

It is instructive that as soon as the Ukraine-Russian war hit, and energy became a problem in Europe, developing countries that had been told by rich countries to divest from fossil fuel and make net zero transition plans watched as Europe made a dash for gas in Africa and had coal-powered energy industries were reactivated in Germany!

The Loss and Damage Fund therefore presented a clear opportunity for developed countries to, for once, build trust and defer to what works for those whom the fund is being set up for. But as usual, they have re-emphasized that for them, it is only about what benefits them, and not what is best for the long-term good of the world.