The Sharm el-Sheikh COP27

Fund designed to help the most vulnerable countries address climate impacts beyond immediate weather conditions

Shahid Javed Burki November 28, 2022
The writer is a former caretaker finance minister and served as vice-president at the World Bank

The Sharm el-Sheikh meeting was billed as the ‘implantation COP’, a conference that would hammer out the details to ensure the world follows through on past pledges. There was some expectation at the COP27 – the initial stands for the Committee of the Parties and the numerical after that the number of times the parties had met. The Sharm el-Sheikh meeting was to deal with the sticking points that remained after COP26, held in 2021 in Glasgow, Britain. These related to accountability and money: how will nations be required to show progress, and who will pay for the society-wide transformation that must occur.

COP27 President Sameh Shoukry acknowledged on Thursday evening (Nov 17), when the conference was heading towards its final hours, that “we are not where we need to be in order to close this conference with tangible result.” EU’s Frans Timmerman said the financial plan being discussed would establish a fund designed to address the needs of the most vulnerable countries and would work quickly to identify the existing financial gaps and ways to address climate impacts beyond immediate weather conditions.

As the world moved forward, the amount of damage global warming was doing was becoming more apparent. The latest example of this was from Pakistan which, in the summer of 2022, suffered unprecedented rains that flooded a good part of the lower reaches of the Indus River. The Pakistani delegation to Egypt was led by Environment Minister Sherry Rehman who, in her pronouncements, underscored the need for a large flow of resources from the rich to the poor but recognised that many wealthy nations were facing their own problems which included unprecedented increase in the cost of living, an energy crunch amid the fallout from Russia’s invasion of Ukraine, and the ongoing coronavirus pandemic. Recognising these problems, she argued that global warming would do even greater damage in poor countries.

There was one unexpected development at the conference: Chiefs of the United States and Chinese delegates were seen working together, something that had not happened until the Nov 14 meeting between Presidents Joe Biden and Xi Jinping at Bali, Indonesia where the two leaders had gone to participate in the G20 summit. John F Kerry, President Biden’s climate adviser, who was heading the COP27 US delegation, linked up with Xie Zhenhua, the chief China negotiator. Kerry was President Obama’s Secretary of State and was well-known in global warming circles. He had worked hard with the Chinese to produce the 2015 Paris Accord which committed all nations to produce their greenhouse gas emissions control programmes for review by the world. At Sharm el-Sheikh, the Kerry-Xie linkup was seen as a sign of thawing relations after the summit between the two presidents.

On Nov 17, the secretariat working to produce a document that the attending nations could agree on came up with a draft which did not excite anybody. Though negotiators had hoped to produce a version of the of the final document as the conference headed towards its final hours – setting clear goals for the meeting and resolving its thorniest debates – the draft was more of a grab bag, listing almost every proposal countries had offered since the opening of the conference. The document contained some language that surprised many of those who were closely following these deliberations. The most noteworthy was a call for developed countries to reach net negative greenhouse emissions by 2030 – something wealthy nations were expected to oppose. However, the document included some new language proposed by India and backed by island nations, the US and the EU that would call for a phasedown of all fossil fuels – not just coal but also oil and gas. But it did not mention an idea suggested by the US that global emissions should peak by 2025, a proposal that would not go well for developing countries still trying to secure basic access to heat and electricity for their people.

It didn’t even go as far as the communique issued by G20 on climate issues. “There has been clearly, as in past times, a breakdown of trust between the North and the South, and between developed and emerging economies,” said UN Secretary General Antonio Guterres. He was offering the involved nations a stern warning of the stakes involved. “There has been clearly, as in past times, a breakdown in trust between the North and South and between developed and emerging economies. This is no time for finger-pointing. The blame game is a recipe for mutually assured destruction. I am here to appeal to all parties to rise to this and to the greatest challenge that humanity is facing.”

Sherry Rehman, who led developing countries, said they wanted to establish a new fund under the United Nations Framework Convention on Climate Change, the sponsor of the COP meeting held every year. The US which, because of the size of its economy, would be the largest contributor to any fund that emerges from these deliberations was initially opposed to the idea. Its contributions could follow the pattern established in financing institutions such as IMF and World Bank. As the meeting drew to the closing moments, diplomats from Britain and New Zealand were working with small island states that would disappear under the sea as the level of seawater rose. They sought more time to work out the details of how the fund, were it to be created, would materialise and how its resources would be used. In the meeting corridors, funding of one trillion dollars was being talked about which would be split between the World Bank and its sister institution, the IMF.

The meeting closed on Saturday, Nov 18, with the pledge that a large fund would be provided for helping the countries most vulnerable to global warming. Since the summit was being held in the African continent, the African delegates pleaded for an outcome that would help their people. In the closing hours of the meeting, the US agreed to the fund idea. Its size, eligibility to it and the modes of its operations were left to be determined by a 24-country committee that was given a year to do its work. The agreement said that nations cannot be held legally liable for their greenhouse gas emissions which are driving climate change.

The last-minute agreement left several contentious issues. Among them was the role China would play in contributing to the fund but would not be eligible to receive resources from it. China has fiercely resisted being treated as a developed country in global climate talks. There was also lack of support among the members of the Republican party for contributing to a UN-managed fund. “Innovation, not reparations, is the key to fighting climate change,” argued Republican Senator John Barrasso. There was a brewing debate about what to call the new fund. Developing nations preferred the term ‘compensation’ and climate activists often referred to as ‘reparations’. Americans called the money ‘loss and damage resources’.

Scientists continue to worry about the impact of warming beyond the levels the world may be able to deal with. Every fraction of degree of additional warming could means tens of millions more people worldwide exposed to life-threatening heatwaves, water shortages and coastal flooding. A passionate plea for urgent action came from Espen Barth Eide, Norway’s minister for climate and environment. “Cities that we love and live in will be gone,” said the minister.


Published in The Express Tribune, November 28th, 2022.

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