COP28 Summit kicks off with breakthrough climate disaster fund agreement

What’s in today’s article?

• Why in news?
• Loss and damage fund
• What is the loss and damage fund?
• How much damage has been caused by industrialisation?
• How much loss and damage is the world facing?
• News Summary: COP28 Summit kicks off with breakthrough climate disaster fund agreement
• How big is the fund and how will it operate?

Why in news?

• On the opening day of the COP28 climate conference in Dubai, a loss and damage fund to help vulnerable countries cope with the impact of climate change has been officially launched.
  • The loss and damage fund was first announced during COP27 in Sharm el-Sheikh, Egypt, last year.
• The initial funding is estimated to be $475 million:
  • host UAE pledged $100 million,
  • the European Union promised $275 million,
  • $17.5 million from the US, and
  • $10 million from Japan.

What is the loss and damage fund?

• About
  • The loss and damage fund is a global financial package to ensure the rescue and rehabilitation of countries facing the cascading effects of climate change.
  • The term refers to the compensation that rich nations, whose industrial growth has driven the planet into a climate crisis, must pay to poor nations.
    • Carbon footprint of these countries is low but are facing the brunt of rising sea levels, floods, crippling droughts, and intense cyclones, among others.
    • The changing climate has impacted lives, livelihoods, biodiversity, cultural traditions, and identities.
• Complexity involved
  • Loss and damage means different things to different groups and there is no agreed upon definition within the UNFCCC.
  • Loss and damage is often categorised as either economic or non-economic.
    • Economic loss and damage are negative impacts that we can assign a monetary value to.
    • These are things such as the costs of rebuilding infrastructure that has been damaged due to a flood, or the loss of revenue from agricultural crops that were destroyed due to drought.
    • Non-economic loss and damage are negative impacts where it is difficult or infeasible to assign a monetary value.
    • These are things such as trauma from experiencing a disaster, loss of community due to displacement of people, or loss of biodiversity.

How much damage has been caused by industrialisation?

• The Industrial Era started in 1850, disrupting Earth’s natural mechanism for the production and absorption of greenhouse gases.
• Today, the US, the UK and the EU are considered to be responsible for 50% of all emissions.
• India is responsible for only 3% of historical emissions.
• Meanwhile China, the world’s biggest emitter in the last 15 years, is responsible for 30% of global emissions every year.

How much loss and damage is the world facing?

• Research shows that 55 vulnerable countries have suffered $ 525 billion combined climate crisis-fuelled losses in the last 20 years.
  • The number is estimated to reach $ 580 billion per year by 2030.
• According to the IPCC, losses and damages will increase in future as global warming continues to rise.
  • It will be unequally distributed and impact developing nations the most and, in them, the socially and financially weaker sections.

News Summary: COP28 Summit kicks off with breakthrough climate disaster fund agreement

• The COP28 climate conference in Dubai kicked off on a positive note after the member countries agreed to set up a climate disaster fund.
• This fund would help countries to deal with the global warming crisis.

How big is the fund and how will it operate?

• Source of the fund
  • Rich nations, such as the US, the UK and the EU, as well as some developing countries are the source of funds.
  • The World Bank will be the interim host to the fund for a period of four years.
    • The developing nations were not keen to have the World Bank manage the fund as they saw this as a means by which richer nations could have more control over the finances.
    • However, they have accepted this term now.
• Scale of the fund remains unclear
  • The scale or the replenishment cycle of the fund remains unclear, but the need of the hour is several trillion dollars.
• Some key areas need to be resolved
  • Who should pay into the fund and what would be the corpus amount are yet to be decided.
  • The payment options into the funds have been made voluntary, and all developing countries are eligible to directly access the resources.

Q1) In which country is COP 28 held?

The 2023 United Nations Climate Change Conference, or COP28, is being held at Expo City, Dubai, United Arab Emirates (UAE). The conference will take place from November 30 to December 12, 2023.

Q2) What is Intergovernmental Panel on Climate Change (IPCC)?

IPCC stands for Intergovernmental Panel on Climate Change. It's a United Nations body that assesses climate change science. The IPCC is made up of hundreds of scientists from 195 countries.

Source: Loss and damage fund approved at COP28 summit: What is the fund, why is it required, and how will it operate? | Wion News | Indian Express