On its final day on November 20th 2022, the United Nations Climate Change Conference COP27 made monumental progress with an agreement to finance countries heavily impacted by climate disasters through a “loss and damage” fund.
Despite the current complex geopolitical atmosphere, COP27 culminated with nations ratifying a package of decisions that reinforced their pledge to limit the global temperature increase to 1.5 degrees Celsius above pre-industrial levels. This package aims to catalyse countries to reduce their greenhouse gas emissions and to enable them to adapt more effectively to the inevitable impacts of climate change. Furthermore, it will work to increase financial aid and advanced technology as well as capacity building in developing nations.
After establishing a particular fund for loss and damage, COP27 made an essential stride in its agenda by officially acknowledging the issue and adopting it for the first time.
“This outcome moves us forward,” said Simon Stiell, UN Climate Change Executive Secretary. “We have determined a way forward on a decades-long conversation on funding for loss and damage – deliberating over how we address the impacts on communities whose lives and livelihoods have been ruined by the very worst impacts of climate change.”
Fund allocations by governments
Governments made the unprecedented decision to allocate new funds and create a special fund to help developing countries that have faced loss and damage. In addition, governments committed to creating a ‘transitional committee’ to recommend ways to implement the new financing arrangements and funds at COP28 next year. It is anticipated that the inaugural meeting of the transitional committee will commence before March concludes in 2023.
After concluding their discussions, participants reached a consensus on the Santiago Network for Loss and Damage structure to provide technical support to nations that are particularly fragile in light of the harmful repercussions of global warming.
The framework to achieve Global Goals on Adaptation
COP27 was a breakthrough for adaptation, with governments uniting on the framework to progress toward the Global Goals on Adaptation. This plan will be completed by COP28 and include in its first Global Stocktake data that can aid those most vulnerable in strengthening their resilience. At COP27, an impressive USD 230 million in new pledges were made to the Adaptation Fund. By adhering to these commitments, countless vulnerable communities will be granted access to effective adaptation strategies for climate change.
The Sharm el-Sheikh Adaptation Agenda and Implementation Plan
COP27 President Sameh Shoukry revealed the groundbreaking Sharm el-Sheikh Adaptation Agenda, a plan to bolster resilience for individuals living in climate-vulnerable societies by 2030. At COP28 next year, the Standing Committee on Finance of UN Climate Change was requested to prepare a report that would double adaptation finance.
The Sharm el-Sheikh Implementation Plan emphasises that a comprehensive, worldwide transition to a low-carbon economy necessitates investments of around USD 4 – 6 trillion annually. To bring about such financial aid, there needs to be an instantaneous and broad transformation of the banking system, including its frameworks and procedures. This requires collaboration between governments, national banks, commercial banks, institutional financiers, and other financial entities.
COP27 was a momentous event where over 45,000 people came together to exchange inspiring ideas and develop powerful collaborations. It provided an opportunity for global stakeholders to forge meaningful partnerships that could potentially shape the future of our planet. Indigenous peoples, local communities, cities, and civil society members – including youth and children – illuminated their efforts to combat climate change while also revealing how it extensively affects their lives.