Debate Over Loss, Damage Likely to Wait Until Paris

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By Dean Scott

Oct. 19 — Small island nations and other countries vulnerable to rising sea levels and other climate impacts regrouped at the Bonn climate talks Oct. 19 for what is widely seen as an uphill battle to get wealthier nations to commit to Loss and Damage, a kind of insurance policy for damage caused by climate change in poor countries, paid for by industrialized nations.

Whether the U.S. and other developed nations should be on the hook for damages already being felt by vulnerable countries and linked to greenhouse gases—which have been largely emitted by those developed nations—won't likely be decided when the five days of Bonn talks conclude Oct. 23. Instead, more than 200 nations will likely have to reach a compromise at the end of two weeks of high-level talks in Paris set to begin Nov. 30, where the countries hope to conclude the first global climate agreement.

Vulnerable developing nations arrived in Bonn having won a partial victory Oct. 5 with the release of the latest draft text of the United Nations agreement, which includes a specific Loss and Damage section under which parties acknowledge “the importance of addressing Loss and Damage associated with climate change impacts and recognize the need for international cooperation and solidarity” in addressing the issue.

Absent from the section: anything that would actually commit industrialized nations to pay for such damages.

Developing countries, environmental groups and other advocates of getting a robust Loss and Damage commitment in the Paris accord acknowledge they are likely to make little headway in Bonn, leaving it front-and-center for the Paris talks. “All of the parties have agreed to exert restraint” in Bonn by not battling over too many issues that would leave the talks in disarray before Paris, Liz Gallagher, who heads E3G's climate program, said at an Oct. 19 news conference.

“There's a sense that people want to see an outcome in Paris,” she said, and they fear a Bonn showdown over such issues could jeopardize progress on other fronts toward the broader deal.

Claiming Partial Victory?

Countries hope to make progress at the Oct. 19–23 talks in Bonn on a host of issues, including a mechanism to ratchet up climate actions every five years or so without reopening the entire agreement.

If agreed to, the Paris accord would be the first to commit developed and developing nations alike to actions to curb their emissions. It would be anchored in pledges roughly 150 nations have put on the table this year to address their emissions, beginning in 2020.

The U.S. and other developed nations point to the fact that the Loss and Damage section is even in the latest draft text as a significant concession that would ensure that the issue is not ignored in the broader agreement reached in Paris.

But many of the most vulnerable developing nations—led by a Least Developed Nations negotiating bloc that includes Bangladesh, Nepal, Senegal and Tuvalu—argue that there are plenty of options beyond a finance commitment that could move the parties closer toward a deal on the Loss and Damage issue.

Other Options Available?

Industrialized nations could agree to explore the possibility of pursuing small-scale climate insurance that could be scaled up later, for example, or could agree to formally extend a mechanism launched at the 2013 Poland climate summit, Saleemul Huq, who advises the LDC bloc in the negotiations, told Bloomberg BNA.

“We understand there's a reluctance for developed countries to deal with this, mainly because they believe we are going to link liability and compensation,” which could open up richer nations to billions of dollars in what would essentially be liability payments, said Huq, director of the International Center for Climate Change & Development at Bangladesh's Independent University.

“My counterargument is: It's in their own interest to actually discuss with us a liability regime now,” because it could shield wealthier developed nations from unlimited liability in the decades ahead as climate effects worsen, he said.

Huq noted that leaders from the world's seven leading industrialized democracies in June pledged to ramp up climate insurance to cover an additional 400 million of the world's poorest and most vulnerable people particularly exposed to climate impacts during the next five years. The Group of Seven countries, which announced the pledge at the end of their June 7–8 meeting in Schloss Elmau, Germany, are Canada, France, Germany, Italy, Japan, the U.K. and the U.S.

The G-7 leaders in the same declaration backed a goal to decarbonize the world economy by 2100 and to cut greenhouse gas emissions 40 percent to 70 percent by 2050, from 2010 levels.

Warsaw Mechanism Extension?

Huq said parties also could find a compromise on language ensuring that the Loss and Damage work under way under the 2013 Warsaw International Mechanism for Loss and Damage—largely limited in its current form only to exploring finance options and other actions—will live on well past the 2015 Paris talks.

Harjeet Singh of Action Aid said developing nations need assurances that any agreement reached in Paris won't close the door to future negotiations on the issue past 2016, when the parties are to do a formal review of the Warsaw mechanism's structure and effectiveness.

“This debate is not going to end in December,” when negotiators hope to conclude their talks in Paris with an international accord, Singh told Bloomberg BNA. “But just putting a mention in an agreement doesn't mean the job is over.”

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