The good news from the COP27 at Sharm El-Sheikh, the creation of the long-due Loss and Damage Fund is eclipsed by what the annual climate summit of the UNFCCC failed to deliver — for rich countries to come clean on the promise and delivery of much-awaited climate finance, and the ambition to reduce greenhouse gas emissions by phasing out all fossil fuels in the timeline required to limit warming to 1.5 C as required by science.
For nearly 30 years, since the 1992 Rio Earth summit, island nations, vulnerable states, developing countries, and civil society have been calling on the rich countries for Loss and Damage funds to cope with the severe impacts of extreme weather on the physical and social infrastructure of poor countries, and the financial assistance needed to rescue and rebuild them. It is about rich countries acknowledging the consequences of their historical emissions, climate inaction, and responsibility for the crisis they have caused.
The announcement in Egypt is, therefore, seen as a massive win for climate justice and a turning point in the negotiations which many long-time observers claimed was key to rebuilding fast-eroding trust in the UNFCCC process.
“This is not about accepting charity, This is a down payment on investment in our futures, and in climate justice,” stated Senator Sherry Rahman of Pakistan, the President of the G77 plus China, the largest developing country negotiation group representing over 134 countries, who had to push back multiple efforts by the United States, which made several attempts to block the creation of the fund right from the start and the EU that offered watered down options that would divide developing countries.
By all accounts, COP27 saw a belligerent US trying to delay, derail, and disrupt the very basis and foundation of the UNFCCC process. Along with other rich and oil-producing countries, and representatives of fossil fuel companies by their side, the US worked hard to question and erase the very principles of Equity and Common but Differentiated Responsibility (CBDR) during the negotiations, and to abolish the requirement established in Glasgow for countries to update their plans on emissions every year.
However, it was the lack of updates and clear directions on the delivery of the promised climate finance of $100 billion per annum created distrust in the process. COP27 was expected to establish a clear plan of delivery and to ensure, that the shortfall is provided in the coming years, but once again the developed countries got away with deleting those key elements from the text, leaving a vague goal with no deadline in a decision that was gavelled through by the Egyptian presidency.
Due to the serious shortfall in adaptation finance in particular, last year at COP26 in Glasgow parties agreed to double adaptation finance by 2025 based on 2019 levels. Despite the calls of African parties and civil society at COP27, this issue failed to get a dedicated agenda item or the political attention it deserved, and will only be considered through a technical progress report by the standing committee on finance rather than a concrete action plan or roadmap.
The only glimmer of hope from COP27 as pointed out by Mohamed Adow, Director of Power Shift Africa, is that for the first time, countries have sent a clear signal calling for the reforms of the multinational investment banks to support climate-compatible development. This pivotal decision will go a long way in de-risking investments, making capital affordable, and unlocking trillions in climate finance.
Finally, Sharm- El-Sheikh failed to address the main cause of Climate Change: the use of fossil fuels. Countries failed to build on Glasgow’s call to phase down coal at COP26, and a proposal from India to stipulate the phasing down of all fossil fuels was also kicked out by oil-producing nations and watered down to a phasing down of coal, which reflected exactly the commitment made in Glasgow.COP27 may have reached a compromise deal to save the process, but Sharm El-Sheikh also exposed an unfortunate truth, that the world governments are so entangled with polluting industries that they are unable to take the path of transformative change that the climate emergency requires. Frans Timmermans, Vice-President of the European Commission, captured it best in his closing address spoke of the tortuous negotiations, which included some countries trying to unpick the 1.5C goal, and of a "yawning gap between climate policies and climate science, too many parties are not ready to make progress in the fight against the climate crisis. Some are afraid of the transition ahead and the cost of change.”