The first week of negotiations at COP27 ended. And everything imaginable seemed to have occurred.

Like many, we were under the impression before leaving for Egypt that it would be a COP lacking in substance and certainly not a history-making one. It was supposed to be a COP for ratcheting up national promises, but we already knew the momentum was not there. It was supposed to be a COP focusing on adaptation. Agreement had been reached already in Glasgow on doubling funds for this. It would be a ‘transitional’ COP, many said.

But everything turned out differently.

At the Bonn Interim Negotiations in June, we saw developing countries suddenly united against the futile dialogue in Glasgow on Loss and Damage (launched at COP26 as a consolation prize after the possibility of creating a dedicated financial instrument for it, like the existing mitigation and adaptation ones, came off the table). There was a forceful call for an agreement at COP 27 on financial instruments – money, not talk – directed at loss and damage. It was a move to overcome a sense of frustration, but with little concrete chance of happening perhaps. Yet we, as part of ICN, believed in it. As members of the European consortium Spark!, we launched a campaign to collect signatures and feedback on loss and damage in Italy while our European partners from Lisbon to Vilnius did the same.

Egypt’s move on behalf of Africa

At the opening plenary of COP27, the President, Egyptian Foreign Minister Sameh Shoukry, announced that the negotiating item on loss and damage financing on the agenda would remain there and that the Presidency expected a formal decision by COP29 or at the end of 2024. This was a bombshell. But, it was also a test of leadership for Egypt, which needs to consolidate its specific role within the African Union. 

Inside COP, decisions are made by a lack of opposition or de facto unanimity without taking a vote. It’s called deciding ‘by consensus’. The decisions announced by Shoukry were preceded, no doubt, by lengthy behind-the-scene negotiations with countries historically opposed to dealing with loss and damage as a financial issue (above all, the United States). Having the issue on the table for the first time in 30 years meant that the US had opened up to the possibility, or they implied that wouldn’t at least formally oppose it. They didn’t. It was perhaps difficult to do otherwise in an uncertain and unstable international context, with challenging midterm elections straddling the COP and at least 100 developing countries waiting outside the door for some kind of declaration.

Team orders

What’s really striking is the solidity of the South’s common front. It’s patently the result of the disastrous events in Pakistan, the widespread sense of frustration and the diplomatic effort wrought by the Chinese, Indians and representatives of a number of key African states in recent months. Developing countries take the floor and make short speeches in which they speak the same language, propose the same goals and move in synch.

In the loss and damage session on Saturday, the team orders were clearly apparent. When asked by the session facilitator to make proposals on how to proceed with the work after the first ice-breaking rounds, all – and we underline– all delegates from the Southern groups presented the same timetable with minor insignificant differences. Noted were:

  • A political decision on getting a financial instrument down on paper at COP27
  • A year or two of hard work defining needs and resources in a highly detailed way to be entrusted to an ad hoc international group of experts who will report back to the countries
  • The official launch of  the financial instrument at COP29

The US and Switzerland raised objections, with their similar efforts generating a smokescreen. In the face of this, the Chinese delegate responded by saying, “This seems to be the one issue on the entire COP agenda that we agree most on, so consequently we need to work on it further”. In a nutshell, it means turning the proposed timeline into a draft negotiating text to be sent to the ministers who were set to arrive the following week. It’s a divisive issue. On the one side there’s the Chinese heading the post-colonial South and on the other there’s the US, practically by itself.

The European Union offers a roadmap and some ‘breakup”

A bilateral meeting between members of the Climate Action Network and EU delegation took place on Friday. There, our volunteer Teresa Giuffré asked the heads of delegation what the European position was on the possibility of a decision being made at COP27. She was told that the conditions for that at this COP were not yet in sight. This was the case given the many existing gaps in information and definitions needed prior to taking on a new global financial venture.

On Saturday morning, our volunteer Aurora Audino posed a similar question to the same delegation on behalf of the UNFCCC youth group, YOUNGO. Aurora asked the European delegation what their position was on funds to prevent disasters (upfront adaptation) and funds to support emergencies (after-the-fact adaptation). The United States had tried to bring this point home days before by talking about ‘transformative adaptation’, much to the indignation of countries already suffering yearly disasters. The answer was that the EU does not see much difference between the two strategies and that they are both supportive approaches. It was similar to what was said the day before in general terms.

However, cornered by the need to say something on the roadmap, the EU conceded in the afternoon negotiating session that if a political decision “is to be taken at COP27″, it would “send an important signal’ and this could start precisely with the roadmap. 

Did this mean there’s been some breakup on the issue among the Western countries? There were some spontaneous breakaways, such as that by Denmark, which reiterated the commitment made a few weeks ago to invest in non-insurance loss and damage compensation funds. It wasn’t exactly the scenario Biden imagined.

Much more is at stake. We’ve spoken here before on the difference between insurance-type instruments, e.g. the Global Shield proposed by the Germans and Biden’s only strategy (which we addressed elsewhere), and compensatory funds. The issue of a one-time grant involves a long game that will go on far beyond COP27.

The Chinese, Indians and the G77 may succeed in leading the rich countries towards at least complementary instruments, e.g. deciding to launch an umbrella mechanism in 2024 that would include both insurance instruments and compensation funds based on voluntary contributions and historical responsibilities. If this happens, it would mean writing an entirely new page of the history of international relations and the UN system.

The West has never really come to terms with its history of exploitation, colonialism and discretionary and extractive invasion of the rest of the world. The blitz by countries from the Global South at this COP27 has been matched by a momentary lack of leadership in the West. The latter is currently weak being preoccupied with winter bills, engaged in costly support for Ukraine’s national defence and being eaten away by vacillating internal political dynamics. The point is to change the rules. If the outcome of this COP were to even just put down on paper a path towards creating a partial compensatory mechanism, we’d be entering a future that was unimaginable six months ago.

One week to go and the ministers have not even landed in Sharm el-Sheikh. On Tuesday or Wednesday, Joe Biden and Xi Jin Ping will meet in Bali for the G20, and this meeting will also come into play. There’s also the issue of Taiwan, the war in Ukraine and trade and customs issues. 

A COP that was apparently monolithically conceived without any real objectives is now in danger of making history. Day by day, however, it’s increasingly clear that that change will perhaps come through a handshake in Bali. This reminds us of another handshake in the Oval Office in September 2015 which led to the adoption of the Paris Agreement.

Taking a break.

Now a day off, even for the delegates. See you Monday.

Article by Jacopo Bencini, Policy Advisor and UNFCCC Contact Point

[Other things that happened in the first week of COP27. Climate finance was discussed. Timely reference was made to Human Rights and this was included in the negotiating text of the ACE action plan. There was more tussle than usual in the carbon market negotiations under Article 6 of the Paris Agreement. Giorgia Meloni spoke and many side events helped to set the tone. We’ve covered all this in our daily COP27 Bulletins from Sharm el-Sheikh thanks to the incredible work done by our team and support from volunteers at home]

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