Day one of COP 28 which concluded on December 13, 2023 saw the European Union and five other nations sign the historic Loss and Damage Fund agreed last year at COP 27 in Egypt.
The draft agreement to operationalize the long-awaited fund aims to help compensate vulnerable nations for the impact of climate change not limited to rebuilding vital infrastructure.
Thus the fund is being touted as a leeway to promoting climate justice for vulnerable nations like Malawi on the receiving end of climatic shocks yet contributing less to the climate crisis.
Meanwhile, Malawi needs over 2 billion kwacha to at least recover from the devastating impacts of Tropical Cyclone Freddy which hit the country in March 2023, affecting over 2 million people, displacing more than 6 thousand , killing 679 and injuring over 2 thousand.
The cyclone also washed away vast pieces of arable land, road network and Malawi’s main electricity power plant – Kapichila Power Station with Malawi obtaining a loan of $60 billion from the World Bank to finance rehabilitation works of the power plant.
However, COP 28 president Dr. Sultan Al Jaber announced a pledge of $100 million to the Fund by his nation the United Arab Emirates leading the way for other nations to follow suit.
He said: “What was promised in Sharm El Sheikh has already been delivered in Dubai and the speed at which the world came together, to get this Fund operationalized within one year since Parties agreed to it in Sharm El Sheikh is unprecedented.
“This Fund will support billions of people, lives and livelihoods that are particularly vulnerable to the effects of climate change, over the next two weeks this Presidency will work with Parties to now deliver the highest-ambition response to the GST,” Jaber said.
Asked by MIJ Online, what the American government makes of this, US Ambassador to Malawi David Young observed the approval of the fund was recognition that the world needed to focus on both mitigation and adaptation to the effects of climate change.
“Malawi has been impacted by cyclones, flooding and we can clearly see that climate change is having severe impacts on Malawians, especially the vulnerable farmer families and others who live in rural areas.
Responding to concerns on the significance of America’s $17.5 million pledge; US being among the top emitters, Young admitted the need to doing more on climate financing.
“I would agree that we need to challenge ourselves to do more, I think it’s legitimate that we all need to do more, the Biden administration is very committed to this.
“They adopted new policies in the Unites States that have been historic in terms of pushing down our emissions and shifting to electric vehicles,” he explained.
However, Fadhel Kaboub, associate professor of economics at Denison University in the US is concerned with the amount of pledges towards the fund.
“While Cop 28 finally succeeded in creating the Loss and Damage Fund, the amount of pledges is far short of the $2.3 trillion needed by 2030 for climate finance.
“This signals the intention to rely heavily on predatory and dangerous finance tactics that amount to green washing and colonial debt traps for developing countries,” added Kaboub.
Meanwhile, a local environmental activist Mathews Malata has stressed on the need to make operational the revised disaster risk management bill, so that disaster investments are channeled towards priority sectors.
Among others, the bill aspires to create structures at local council and community levels for risk disaster management to promote coordination in management of disasters.
The bill also seeks to address issues of preparedness by giving powers to the line minister to declare a risk area and relocate people to safer places.
“We need to speed up the processes to operationalize the revised disaster bill. We also need to prioritize our investments by targeting those that will have a huge impact on the economy and can quickly restore livelihoods.
“We should expect hitches but we must fight on, it’s a great milestone but not the end to the struggle, the same momentum should also be seen in other important topics especially those linked to carbon emissions reduction”. Malata said.
Malata has also warned against false solutions to solving the climate crisis, arguing these must be avoided at all cost if climate justice is to be achieved.
“False and temporally solutions should not come in place of just and sustainable solutions because we know whatever amount they will be paying will not cover the recover and disaster risk reduction financing gaps”.
Besides, in a country where frequent disasters are imposing huge costs of repairs on an already fragile economy evident from economic losses of $335 million and $220 million from the 2015 and 2019 floods respectively, stakeholders feel there is need for strategic action to maximize benefits from the funds.
Precisely so, Mike Marvin Banda, national coordinator for the Malawi Economics Justice Network says Malawi needs to position herself carefully to gain a fair share of the funds.
“We qualify for the fund, but it isn’t automatic so we need to position ourselves strategically to benefit from it. It’s also pleasing to note the pledge by the Scottish government to the tune of five billion kwacha which is going towards families that were heavily affected by Cyclone Freddy.
“Of critical importance is how the UN place enforcement mechanism so that the pledged resources are really committed and the criteria to disbursing the resources accordingly among the most affected countries” Banda said.
At the end of COP 28, less than $1 billion was pledged towards the loss and damage fund by among other countries; France $108.9 million, Germany $100 million and United Kingdom $50.6 million.
However, the funds are way short of the $2.4 trillion of transformative grant-based investments and transfer of technology needed for climate adaptation and mitigation by 2030.