$475 million pledged to climate disaster fund as COP28 makes a promising start

India welcomed the decision, with Environment Minister Bhupender Yadav saying at the meeting: “India strongly supports the operationalisation of the loss and damage fund today. It is a landmark decision.”

The loss and damage fund was set up during COP27, the previous version of the UN’s annual climate change conference, at Sharm el-Shaikh in Egypt last year. The fund, a long-pending demand of developing countries, is meant to provide financial assistance to countries recovering from climate disasters, such as extreme weather events. It would also be used to finance measures to deal with other climate-related emergencies, like sea-level rise, migration, and displacement.

Last year, however, no country had promised any money to the fund. Many other details of the fund had also not been finalised. The Sharm el-Shaikh meeting had set up a Transitional Committee to work on these details and submit its recommendations by the next meeting. The committee had met several times during the year, and made several recommendations.

UAE, the hosts of COP28, decided to deal with this right at the start of this year’s conference, and convinced other countries to accept the recommendations, overlooking their objections to specific points for the time being. The acceptance of the recommendations, and the commitment of money for the fund, sealed an important decision that has the potential to create the right atmosphere for a few more meaningful decisions during the conference.

“This is the spirit we should like to take forward through the two weeks of meetings here,” said COP28 president Sultan Al Jaber, who is also the UAE’s minister of industry and advanced technology.

The operationalisation of the loss and damage fund was welcomed by all parties, and hailed as a very important step forward in helping small and developing countries in dealing with the impacts of climate change.

Apart from the EU and the UAE, Germany promised $100 million, the UK committed about $70 million. The United States said it would contribute $17.5 million, and Japan promised $10 million.

Under the international climate change architecture, developed countries are obligated to provide money to developing countries for different kinds of climate action.

Harjeet Singh, head of global political strategy at Climate Action Network International, who has campaigned for such a fund for years, said that while the flow of money was welcome, it was, as of now, inadequate in comparison to the requirements.

“While these funds are valuable in initiating activities, it is important to recognise that the costs of rebuilding from the devastating effects of climate disasters run into hundreds of billions of dollars annually. Rich countries, given their significantly higher historical responsibility, must do more on a scale commensurate with their impact on the planet-heating emissions,” he said.