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Innovative ideas to raise cash are not moving ahead at U.N. climate talks
After a year when powerful hurricanes, floods, droughts and fires have racked up hundreds of billions of dollars in damage in countries from the United States to Bangladesh, you might think their leaders would be looking desperately to the U.N. climate talks for new ways to cover those costs.
You’d be wrong - at least when it comes to the richer countries and the formal process that aims to do that.
A mechanism aimed at putting in place ways to help poor countries hit by growing “loss and damage” from climate change to foot the rising bill was first agreed by rich and poor nations at the U.N. climate talks in Warsaw in 2013.
Its backers have suggested a range of innovative ideas to raise cash – from a tiny tax on each stock trade and other financial transactions, to a levy on airplane flights. But richer countries, so far, have blocked action in moving ahead on any of them at the conference this week in Bonn, hosted by Fiji.
“There was hope the Fiji (meeting) would be more willing to move forward” given the scale of the potential losses low-lying Pacific islands face from storms and sea level rise, said Sven Harmeling, CARE International’s climate change advocacy coordinator.
But “there’s no real move to discuss the financial instruments we need,” he said. “They’re not even willing to start the discussion.”
Instead, so far, countries are looking to a single solution to fill the gap: insurance policies.
Insurance can – and is – helping poor countries and communities lower their risks from climate disasters. But it cannot work in every situation, experts say.
Slow-moving crises, such as sea level rise, are nearly impossible to insure. Insurance payouts can provide effective help for big, sudden disasters – a powerful hurricane or flood – but aren’t so effective at helping out with the increasing drumbeat of smaller but accumulating everyday losses.
And what happens when disasters come so frequently, and at such cost, that they are no longer insurable? That’s a worry, experts working on loss and damage issues say.
“These disasters are eroding whatever development gains we’ve made,” said Harjeet Singh, who leads climate policy work for aid agency ActionAid. “People can’t stay safe. Before they cope with one disaster, another one hits them harder.”
And that’s not just in poor countries, he said. Even the United States this year has been slammed by hurricane damage, flooding and runaway forest fires. The costs of Hurricane Harvey alone could reach as much as $190 billion, U.S. agencies estimate.
“Loss and damage will not be limited to developing countries,” Singh said. New ways of dealing with losses, including taxes, “are needed equally for developed countries. It’s in everyone’s interest.”
So what’s holding back progress? There’s the longstanding fear among rich countries that moving ahead on dealing with loss and damage will end up with them being held financially liable for the costs of damage around the world driven largely by their own use of fossil fuels over decades.
But lobbying by powerful industries against taxes on things like fossil fuel use and financial transactions also are playing a role, Singh said.
“These are the same vested interested that have got us to a stage where the only planet where we can live is becoming uninhabitable for many,” he said. “We’re moving towards a very dangerous world if we continue to serve the interests of the same lobbies.”
What poor countries are asking for at the U.N. climate talks, he said, is not “billions on the table” direct from rich governments but “space to work on financial instruments”.
Failure to find answers will have consequences for rich countries as well as poor –and not just from worsening disaster losses. If poor families can no longer survive, they will move, he warned, adding to migration pressures around the world.
“With some support, they can stay where they are, with some finance and instruments to help them recover. Trust me, the majority of people do not want to move,” Singh said.
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