Loss and Damage decisions, pitfalls and promises

Loss and Damage decisions, pitfalls and promises

Subject: Environment

Context-

• A major takeaway from COP27 in Egypt, as far as loss and damage (L and D) is concerned, is the decision relating to new funding arrangements focusing on L and D — those particularly vulnerable to the adverse effects of climate change.

Transitional Committee-

• Formed at CoP27, Egypt for providing the finance-related problems of Loss and Damage financial mechanisms.

Aim-

• To make recommendations on how to operationalize both the new funding arrangements and the fund at COP28 next year.
• The first meeting of the transitional committee is expected to take place before the end of March 2023.

Common but differentiated responsibilities and respective capabilities (CBDR- RC)-

• It recognises that countries (known as Parties) have different duties and abilities to address the negative impacts of climate change, but all countries have an obligation to address climate change.
• At the 1992 United Nations Conference on Environment and Development (UNCED) in Rio de Janeiro, the CBDR-RC was officially enshrined in the UNFCCC treaty on Climate Change.
• Reflecting CBDR-RC, the Convention divided countries into “Annex I” and “non-Annex I,” the former generally referring to developed countries and the latter to developing countries.
• Under the Convention Annex I countries have a greater mitigation role than non-Annex-I countries.

Alliance of Small Island States (AOSIS)-

• It is an intergovernmental organisation of low-lying coastal and small island nations.
• Established in 1990
• Purpose of the alliance is to consolidate the voices of Small Island Developing States (SIDS) to address global warming
• As the existence of many AOSIS states are put at risk by climate change AOSIS has threatened lawsuits
• AOSIS has a membership of 44 states
• India is not a member
• In Indian ocean 4 states are member :
  • Comoros
  • Maldives
  • Mauritius
  • Seychelles

Global Shield Scheme against climate risks-

• It is envisioned as social protection and insurance-based finance mechanism for loss and damage outside the UNFCCC process.
• The finance facility, based on a polluter pays principle, is being intensely argued by the Least Developed Countries and the Association of Small Island States negotiating blocs at the negotiations in COP27.
• The initiative will provide pre-arranged financial support designed to be quickly deployed during climate disasters such as the devastating Pakistan floods in August.
• Pakistan, Bangladesh, Costa Rica, Fiji, Senegal, Philippines and Ghana will be among the first countries to receive assistance from the Global Shield initiative.
• Countries that are supporting the initiative are- Germany, Denmark, Ireland, Canada, the USA, U.K., and United Nations Organisations including UNDP and UNODRR.
• The Global Shield is touted to expand financial protection instruments for governments, communities, businesses and households.
• In terms of implementation, it will align with the vulnerable country’s financial and economic strategies, helping close the financing gaps.
• This would include livelihood protection, social protection systems, livestock and crop insurance, property insurance, business interruption insurance, risk-sharing networks and credit guarantees.
• It will support the integrated development of instruments at the level of governments, humanitarian agencies and non-profits, to ensure that money is available when needed.