The parties at COP23 have decided to adopt the draft policy on loss and damage from climate change without any clarification on where the funding for this is coming from.
In order to recover the sudden loss induced by climate change, the UN climate talks adopted a provision of Loss and Damage in the 2015 Paris Agreement.
The parties in their 23rd conference in Bonn finally adopted the policies to implement the agreement, over which rights groups expressed serious concern.
The financing was supposed to come from public sources such as like grants, but the parties agreed to receive funding from the private sector, such as finance from insurance, as the major source of funding for addressing loss and damage.
“Our demand was to have public funding to address the loss and damage incurred from climate change but the developed parties did not agree with us,” said Adao Soares Barbosa, a negotiator from Least Developed Countries (LDCs) group.
However, the negotiator from Timor-Leste said he still has hopes as the developed countries had assured them that the public finance issue would be discussed in the expert dialogues in 2018.
25 large insurance companies have joined the global partnership, with an aim to reduce climate vulnerability
Bangladeshi negotiator Mirza Shawkat Ali reiterated this statement, telling the Dhaka Tribune: “Although we did not get the money in fast-track mode there is the chance to change that during the expert dialogues in 2018.”
Regarding the absence of finance in loss and damage policy, a LDC negotiator seeking anonymity said: “Everything that is being adopted here, is what the developed countries want. We can only raise our voice and demand our place but it all goes in vain.”
Meanwhile, an international initiative called InsuResilience Global partnership aimed at providing insurance to 400 more million poor and vulnerable people by 2020 was launched at the COP Presidency Event on Tuesday evening.
Addressing the launching event in Bonn, COP23 President and the Prime Minister of Fiji, Frank Bainimarama, said the Global Partnership is a practical response to the needs of those who suffer loss because of climate change.
“I am very proud that it has happened under Fiji’s Presidency of COP. At the same time, it is a means of preparing for a more resilient form of development for those who will have to adapt to the great challenge of climate change,” he said.
Thomas Silberhorn, Parliamentary State Secretary to the Federal Minister for Economic Cooperation and Development of Germany, announced support for the new global partnership of $125 million at the launch.
This follows the £30 million commitment made by UK Government in July 2017 to the Partnership through its Centre for Global Disaster Protection.
The announcement comes in the wake of a year of damaging and devastating extreme weather events that have hit countries and communities in Asia, the Caribbean and the Americas, with some of the events described as “unprecedented” in their level by scientists.
The Global Partnership supports data and risk analysis, technical assistance and capacity building according to countries’ needs and priorities. It offers concrete risk finance and insurance solutions, smart support for the implementation for such schemes, and monitoring and evaluation efforts.
This will range from sovereign risk pools in the Pacific, Africa and the Caribbean. The insurance schemes focus on the meso and micro level to the benefit of smallholders, the urban poor and other vulnerable groups.
25 large insurance companies have joined the global partnership, with an aim to reduce climate vulnerability.
Thomas Silberhorn said the Global Partnership brings important groups like the V20 and the G20 together around one table so that they can join forces to increase the resilience of poor and vulnerable people to the impacts of climate change.
“Instead of only reacting to catastrophes we want to shift to planning, preparing and protecting,” he said.
Harjeet Singh, global lead on climate change for Actionaid International, said: “Insurance might be a piece of the puzzle, but we can’t pretend that it’s a safety net for everyone. Insurance can help people who are impacted by floods or cyclones, but it won’t be an option for those facing certain losses.”
Apart from the global insurance partnership, the UN Climate Change secretariat has launched an online platform or Clearing House for Risk Transfer under the Paris Climate Change Agreement. It will use artificial intelligence to connect countries seeking innovative insurance solutions with countries needing them.
The Clearing House for Risk Transfer is being called a “matchmaking” website by experts who view it as just a way for private companies to meet more clients.
Harjeet Singh asked: “It’s unclear at this stage who will pay for the premiums. Will poor people in vulnerable countries, who have done nothing to cause the climate crisis and who bear the brunt of its impact, need to pay for climate insurance? And will these communities fall deeper into poverty as a result?
“In some ways, it’s ironic. On one hand, developed countries aren’t allowing UN climate talks to make any progress on the issue of climate finance. But at the same time they’re putting effort and money into initiatives that will mainly help private companies to profit from selling insurance to the poor,” Harjeet added.