At COP21, a Frantic Debate Over Climate Aid, and Some Hopeful News About Climate Insurance
Last night's negotiations saw a lot of walkouts, with finance as the wedge. Climate insurance could be a major boon for the global south—and an easier pill for the West to swallow.
TED SCHEINMAN DEC 4, 2015
Reporters and delegates arriving at le Bourget for COP21 this morning discovered bodies on the ground. Activists had staged a die-in, lying in various postures of defeat and moving only to participate in the chants:
"What do we want?" "Loss and damage!" "When do we want it?" "Now!"
"One point five degrees! One point five degrees!"
"Climate justice!" "Climate justice now!"
The protest was organized by Act Now for Climate Justice, and comes at a moment when the debate over "loss and damages" has imperiled basic negotiations over finance.
“The brute reality of the talks have set in," says Kelly Dent, who heads Oxfam's team on economic justice. "It's getting political, and lives are on the line."
"We don't want to hear 'compensation'—it's reparations. Reparations for climate debt. Loss and damage has to be anchored in the Paris agreement, and it has to be operable as soon as possible."
According to Dent, last night's adaptation sessions were "a bit of a bust-up," with rich countries remaining cagey about economic commitments, and delegations from the United States, Canada, Japan, and others insisting that we broaden the pool of contributing countries—essentially asking poorer countries to send aid to each other, a tactic that some observers say is part of a larger campaign to strip the Paris agreement of any hard terms on finance—or questions of historic liability.
Those questions lie at the heart of the debate over loss and damages: To acknowledge a climate "debt" in an official United Nations agreement could leave wealthier countries answerable for liability claims of massive proportions. (Politico has estimated that, under such an arrangement, developed countries might be answerable for "hundreds of billions of dollars for the role their industrialization played in global warming.") And while Obama pledged on Monday to "embrace our responsibility and to do something about [climate change]," negotiators from wealthier developed countries—including the U.S.—have been slow to embrace that responsibility, or even accept it.
"We don't want to hear 'compensation,'" Prerna Bomzan of LDC Watch has said. "It's reparations: reparations for climate debt. Loss and damage has to be anchored in the Paris agreement, and it has to be operable as soon as possible."
Brandon Wu, a senior policy analyst at ActionAid USA, had withering remarks this morning about his country's negotiators: "They're trying to hide loss and damage in a way that would be underhanded if it weren't so familiar. One of the major tactics is to force a conversation about expanding the pool of contributors.”
At-risk countries had been lobbying for a more ambitious climate target (1.5 degrees over pre-industrial levels, rather than two), a bid that fell through last night when Arab states, led by Saudi Arabia, blocked any discussion of enhanced emissions targets. Meanwhile, at various of the spin-off groups, some negotiators from the G77 group staged walk-outs last night, having grown impatient with Western intransigence on finance, and especially on loss and damage.
Asad Rehman, senior campaigner for Friends of the Earth and an old hand at U.N. climate summits, says these walk-outs are disheartening but not surprising. "[G77 negotiators] are saying that developed countries have been negotiating in bad faith and are deliberately excluding all of the issues that developing countries are concerned about," Rehman says. "I think there's a palpable anger amongst developing country negotiators—real anger and frustration."
Today, though, there is progress, of a very modest sort. Where yesterday, Western powers were pushing for a "no-text" option on loss and damages (i.e., the option to remove loss and damages wholesale from the final draft), today they're showing greater willingness to discuss certain details of finance, including funds for loss and damage, mitigation, and adaptation. Laurent Fabius, the French foreign minister and president of this year's climate summit, will demand a working draft at noon tomorrow, at which point he will review it with top-level ministers from over 100 countries. (Secretary of State John Kerry returns to Paris on Monday, according to his press office.)
It is possible that climate insurance could help ease the burden on the world's most vulnerable populations while setting Western minds at ease about how much money they'll need to contribute. The Munich Climate Insurance Initiative made a persuasive case today for the promise of the G7 InsuResilience project, which German Chancellor Angela Merkel announced at the G7 summit this June. Right now, around 100 million people in developing countries are insured against climate risks; InsuResilience aims to raise that number to 500 million. Peter Hoeppe, MCII's chairman, noted today that two-thirds of all weather-related fatalities have occurred in the lowest-income countries. (MCII draws its data from Munich Re—the source of yesterday's climate risk index, and the world's most comprehensive database on natural disasters.)
"Right now, in most developing countries, there is no insurance market where people could cover at least part of the risk," Hoeppe says. "With InsuResilience, after an extreme event, those affected get a payout so they can buy seeds again.”
The InsuResilience project has been engaging countries both individually and in groups—the Caribbean's Catastrophic Risk Facility and the African Risk Capacity are two such "pools"—and seeks to develop early-warning systems for those countries, plus mobile updates on everything from risky weather to insurance pay-outs. There's reasonable concern about whether current disbursements at the national level are getting to the right people, but InsuResilience can, in many cases, provide direct insurance, and their aim is to do more of it; already, in certain parts of the Caribbean, Hoeppe says, "insured people get a [mobile] notification within 24 hours whether there will be a payout, and they get the money at latest 14 days later on their account." MCII aims to provide individual insurance to 100 million vulnerable citizens by 2020.
Christoph Bals, MCII's vice chair, says that international climate risk insurance can help untangle thorny questions that have been "oversimplified in the loss and damage debate." Equally important: Aid in the form of insurance could well prove an easier sell among wealthy nations, who remain leery of donating lump sums to the Green Climate Fund and other such instruments of aid.
"It's appealing to donor countries because of the incentives to reduce risks," Bals says. "And it is very transparent what risks are covered. Also, the cost is transparent and can be limited. But: It's no instrument to replace adaptation; rather, to complement it."
"Climate insurance is also a tool that shows we can bring positive solutions, and not just say no all the time," Bals says.
We'll see how things go tonight. The negotiators' final evening with this draft will hardly be a relaxed affair, but hints and whispers about finance developments this afternoon offer a bit of hope. It remains possible that a loss and damage deal might appear in the final binding agreement, but the consensus in Paris says it's more likely to be included in the appended, non-binding "decision." That would be a shame, and would leave a major hole in the safety net—one that no international insurance initiative, no matter how robust, can singlehandedly repair.
"We do not foresee an outcome in Paris without loss and damage," Pa Ousman Jarju, chair of the Least Developed Countries group of 48 nations, told reporters on Thursday. “That is a red line for us.”
"Catastrophic Consequences of Climate Change" is Pacific Standard's year-long investigation into the devastating effects of climate change—and how scholars, legislators, and citizen-activists can help stave off its most dire consequences.