On Thursday, the 28th session of the Conference of the Parties (COP28) to the United Nations Framework Convention on Climate Change (UNFCC) decided to launch the "Loss and Damage" Fund, which will compensate the countries most vulnerable to climate change for the impacts of global warming.
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The United Arab Emirates, Germany, the United Kingdom, the United States, and Japan committed to finance this fund, which incorporated the details of the proposal developed by the United Nations Loss and Damage Transitional Committee.
"The speed at which we have done it has also been unique, phenomenal, and historic," said COP28 President Sultan Ahmed Al Jaber, referring to the approval of the Lost and Damage fund, which will be temporarily housed at the World Bank for at least four years.
However, this suggestion was opposed by some representatives of Global south countries and civil society groups, who demanded that the fund be independent of the World Bank because they distrust this institution.
"Loss and damage refers to the irreversible costs of extreme weather and slow-onset disasters such as sea level rise, ocean acidification and melting glaciers caused by global heating. It is about holding the biggest fossil fuel polluters liable for the pain and suffering already caused by climate breakdown," The Guardian explained.
"Finance for loss and damage is considered separately, and in addition to, securing funds for mitigation and adaptation to help developing nations prepare for what is coming," it added.
On the first day of COP28, the countries formally adopted the decision that makes the fund operational, which also comes with the first official commitments of contributions from some states considered the major historical culprits of the climate crisis.
The United Arab Emirates and Germany are expected to each contribute US$100 million to the new fund. Japan will capitalize the fund with US$10 million.
Besides contributing US$17.5 million to the fund, the U.S. promised to donate US$4.5 million to the Pacific Resilience Mechanism and US$2.5 million to the Santiago network for its launch, according to John Kerry, the U.S. Special Presidential Envoy for Climate.