COP28: Day one sees deal on loss and damage fund

A funding mechanism aimed at assisting those countries particularly vulnerable to the effects of climate change was activated on the first day of the UN Climate Change Conference in Dubai, in a positive sign for climate negotiations.

COP28 President Sultan al-Jaber said he was hopeful this would pave the way for more climate change reparations.

UAE, the host country for COP28, along with Germany, both pledged $100 million for this "loss and damage" fund, which was first agreed at the COP27 event, held in Sharm el-Sheikh, Egypt, in November 2022.

"What was promised in Sharm el-Sheikh, has already be delivered in Dubai," said Jaber in a statement. "The speed at which the world came together, to get this fund operationalized within one year since parties agreed to it in Sharm el-Sheikh is unprecedented."

A transitional committee was formed at COP27, which was to make recommendations regarding the structure of this mechanism. But progress on this fund had been slow due in the lead-up to this climate summit due to differing views between developed and developing countries.

In a press briefing, Simon Stiell, executive secretary of the United Nations Framework Convention on Climate Change, said the issue of loss and damage has been a central priority in global climate efforts.

He said he hoped this gave governments and industries "momentum to deliver ambitious outcomes" during COP28, which runs until Dec. 12.

The UK (GBP40 million), Japan ($10 million) and the US ($17.5 million) also committed to this fund, the statement said. Loss and damage refers to the negative consequences that arise from the unavoidable risks of climate change, like rising sea levels, prolonged heat waves, desertification, the acidification of the sea and extreme events, such as bushfires, species extinction and crop failures, according to the UN website.

This deal comes as extreme weather events have been on the rise this year, with 2023 set to be the warmest year on record.

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Inventory focus

Jaber said this sets up the stage for the summit to finalize a global inventory list, which is considered to be the main front of resistance at COP28.

The global inventory process itemizes what countries and stakeholders are doing or failing to do to meet their commitments under the Paris Agreement.

The process is also designed to help chart solution pathways to 2050 and help set more ambitious targets at a global and national level, including goals for the increased deployment of renewable energy.

Analysts at S&P Global Commodity Insights have said the global inventory list would be a "moment of truth" as parties will be called to catalyze the political commitment to accelerate efforts in global climate ambition and action and fill the current gaps.

"COP28 represents a turning point for the progress on the climate agenda and the future of the Paris Agreement. It comes at a critical moment for accelerating collective progress," they said in a recent note.