ECO is sure that delegates remember the hot fires of dissent that the Warsaw International Mechanism for Loss and Damage (WIM) was forged in. At COP19, in the wake of Typhoon Haiyan, Parties agreed that the WIM would enhance understanding, strengthen coordination, and enhance action and support €” including finance. In fact, so hot was the passion of COP19, that terms like “enhance” and “mobilise” were used no less than five times in relation to finance in 2/CP19. Enthusiasm had not dimmed in the Paris Agreement, where again countries agreed to enhance action and support for loss and damage.
And yet some developed country delegates have tried to pour water and douse this fiery discussion. Instead of discussing FINANCE they are very keen to discuss FINANCIAL MECHANISMS, which, somehow seems always to focus on insurance. Insurance may play a role to address loss and damage in some instances, but it should not be confused with finance. In fact, insurance is something that requires finance; it demands premium coverage for the poor and vulnerable people and countries. Otherwise, it pushes the responsibility for dealing with the worst climate impacts onto those who did not cause climate change.
Delegates, as must be clear to anyone familiar with either the foundational mandate of the WIM, Article 8 in the Paris Agreement, or, indeed, with the impacts being faced by those on the front line of climate impacts, actual $$$, £££, ‚¬‚¬‚¬, ¥¥¥ is essential. And a significant amount €” at least US$50 billion by 2022 €” over and above adaptation and ODA finance, increasing along with the expected damages. Some sources suggest an order of magnitude of around $300 billion by 2030.
Yes. ECO hears your gasp. This much finance would be the equivalent to a doubling of existing ODA budgets through public finance. This is why ECO recommends considering fair and equitable innovative sources of finance. One such example is a Climate Damages Tax, paid for by the fossil fuel industry for the climate damage they are wreaking on vulnerable people. An equitable Climate Damages Tax, and other innovative sources, if well designed, could raise this kind of funds in a truly polluter pays fashion. Thus meeting the original mandate of the WIM, the spirit of the Paris Agreement, and ensuring that the people on the front line of climate impacts are not left to suffer without the international support and solidarity they have been promised.