Ahead of COP28, climate Loss and Damage Fund talks conclude without agreement

For a considerable time, climate-vulnerable developing nations have been demanding that rich industrialized countries, responsible for a major portion of cumulative carbon emissions, compensate them for damages caused by intensifying storms, floods, heat waves, and rising sea levels, all exacerbated by climate change.

The UN climate talks (COP27) in Egypt's Sharm El Sheikh last year achieved a major milestone by establishing a Loss and Damage Fund to help people recover from devastating climate impacts.

After the breakthrough at COP27, the UN formed a 24-member Transitional Committee to develop recommendations for the operationalisation of the new fund and funding arrangements. Despite multiple meetings, a high-level ministerial, and two workshops, no agreement has been reached on the key issues related to hosting the fund and making it accessible to vulnerable communities and countries.

At the fourth and final Transitional Committee meeting at Egypt's Aswan which concluded on Saturday, rich countries were expected to force the World Bank as the option to host the Fund, instead of creating a new standalone Fund under the UN.

"The World Bank has no climate culture. It recently made climate part of its mission, and we have been fighting climate change since the Rio conference," Pedro L Pedroso Cuesta, Chair of the Group of the 77 and China, said in an online press conference on the stalemate in the negotiations at the last meeting.

"The way in which the World Bank has been assisting countries in their development policies is not fit for the purpose in relation to what we're looking for from this new climate facility," he said. Cuesta said that the US came to the meeting with a fixed idea -- either it's the World Bank or nothing.