COP27: NGOs question plan to compensate developing countries for climate change impacts

Germany, together with the V20, a group of 58 developing countries that are among the most affected by climate change, has announced the creation of the “‘Global Shield’ against climate risk” on Monday on the occasion of COP27. For now, it consists of 210 million euros to help the poorest countries cope with climate catastrophes, but environmental NGOs were skeptical of an initiative they consider insufficient.

In the midst of COP27, which runs until November 18 in Sharm el-Sheikh, Egypt, the German Presidency announced the creation of a “‘Global Shield’ against climate risk.” The initiative was unveiled together with the V20 network – the 58 states most vulnerable to climate change.

The issue of “loss and damage”, the climate effects that are already wreaking havoc in different parts of the planet and that will not be reversed, is a main theme of this summit. The meeting is expected that rich countries will commit to economically compensate developing countries for climate impacts, since historically they are the ones that have made the most greenhouse gas emissions.

For now, the plan presented by Germany consists of a budget of 210 million euros (170 million euros announced by Berlin and 40 million from other countries) and will initially benefit a first group of countries, including Bangladesh, Costa Rica, Fiji, Ghana, Pakistan, the Philippines and Senegal.

The stated aim is to compensate for the “weaknesses of the financial protection structures” of the most vulnerable countries through “pre-organised financing” that can be disbursed before or just after a climate catastrophe.

The ‘Shield’ will finance insurance schemes against damage to crops, buildings or business interruption and will be tailored to the needs of each country. “It can be adaptive social protection systems” or “immediate financial support to a government to rebuild a bridge or a school,” explained German Cooperation and Development Minister Svenja Schulze.

The senior official said at a press conference that it is only “the seed,” because “more money will be needed” to cover the needs.

Damages estimated at $525 billion

From Bangladesh, the special climate envoy and Minister of Foreign Affairs, Abdul Momen, recalled that vulnerable countries, although they represent about 20% of the world’s population, are only guilty of 5% of global greenhouse gas emissions. He urged members of the G7 and the European Union to “mobilize additional resources” through the ‘Shield’.

According to the V20, the damage caused by climate impacts on the economies of its members would reach 525,000 million dollars from the year 2000.

Ken Ofori-Atta, Ghana’s Minister of Economy and President of the V20, stressed the need for a “Marshall Plan for the climate crisis” as “the situation will get worse.” According to the UN, the international climate commitments of recent years are “far away” from the goal of the Paris Agreement, adopted in 2015, to limit global warming to 1.5ºC above pre-industrial levels.

“It’s not a question of who pays for the losses and damages, because we, the V20, are already paying for it,” the minister said. The poorest countries are being particularly affected by the climate crisis and have fewer resources to cope with the disasters caused.

“We are paying in good lost opportunities, in less productivity, in the affection to business interactions, to lifestyles, in lives lost …”, explained the director of the Ghana Environmental Protection Agency, Henry Kwabena Kokofu.

“The fate of the most vulnerable is the fate of the whole world,” he warned. Recently, the United States and Europe have also been more affected by droughts, fires or floods.

An initiative criticized

Svenja Schulze said that the ‘Global Shield’ is not “a kind of tactic to avoid formal negotiation on loss and damage” in the framework of COP27, but “only the beginning”. However, environmental NGOs fear it could be a distraction in the process of creating an exclusive fund for loss and damage, as requested by vulnerable countries.

The current budget of €210 million is far from approaching the $100 billion a year from 2020 pledged by developed countries in Copenhagen in 2009 to help developing countries tackle climate change.

“Subsidized insurance and the social protection elements of the Global Shield may be a part of the response to loss and damage suffered by people on the frontline, but it is not a solution at the scale we need,” the Climate Action Network said in a statement.

Environmental organizations also criticized that only some countries such as Germany, Belgium, Ireland, Denmark or France committed to participate in this financial shield.

From Greenpeace, the head of the international delegation at COP27, Yeb Saño, stated for his part that “to deal with the continuous catastrophic losses and damages of climate impacts that are occurring around the world you need more than a security shield, you need a sword in the form of a financing mechanism for loss and damage.”

These summits are generally criticized by climate experts who denounce few commitments and little action in the face of the reality of the climate crisis. On Monday, COP27 President and Egyptian Foreign Minister Sameh Soukri acknowledged that there is little progress in the negotiations and that there is still “work ahead to obtain results.” “We have to change gears and complement the technical discussions with others of political commitments,” the minister said.

Source: France24