A long-awaited fund designed to help lower-income countries respond to natural disasters is finally taking shape at the U.N. climate conference in Baku, Azerbaijan.
Wealthy nations agreed to create the fund at the 2022 climate summit in Sharm el Sheikh, Egypt, after decades of resistance. Last year, a group of nations — including the United States and the European Union — made the first financial commitments.
Now, the fund has a leader and is looking to start distributing money within the next year.
Ibrahima Cheikh Diong, who has Senegalese and American citizenship and has held roles at financial firms and at development banks, started this month as the inaugural executive director of the initiative, which is formally known as the Fund for Responding to Loss and Damage.
At this year’s climate summit, known as COP29, formal agreements were signed that will allow the fund to begin formally receiving the money that has been pledged and to start distributing it soon. The fund is being managed by the United Nations, and the World Bank is serving as a financial trustee.
Sweden this month became the latest country to make a pledge, with its $19 million contribution bringing total commitments to around $720 million.
“We have the momentum going, and we got some new pledges, even though modest,” Mr. Diong said. “I haven’t slept since I took this job simply because I understand it’s beyond just promoting the fund. We’re talking about people’s lives. There’s a human face to what we do, and that should inspire us to go faster and better.”
What, if anything, wealthy countries owe poor nations is a central debate as the world grapples with the increasingly costly effects of climate change.
Rich nations have resisted efforts to be held accountable for their historical emissions, which are raising temperatures and fueling extreme weather around the globe.
Developing countries make the case that they are disproportionately suffering from storms, floods and droughts, even though they are responsible for almost none of the emissions that have warmed the planet and deserve compensation.
In Baku, a major focus of the conference is getting wealthy nations to commit more money to support efforts to combat climate change in the developing world.
Negotiators at COP29 are trying to agree on a separate plan that would see up to $1.3 trillion in financing per year flow from countries like the United States and Japan to poorer nations like the Philippines and Zimbabwe. That money would help developing countries adapt to climate change and transition away from fossil fuels.
The loss and damage fund will exist alongside whatever new commitments come from that effort. When a poor country experiences a severe storm that inflicts catastrophic damage, it will be able to apply for monetary assistance. Mr. Diong said that in an ideal world, countries would have access to funds within weeks of a disaster.
But $720 million will go only so far. Climate-fueled disasters are causing hundreds of billions of dollars’ worth of damage around the globe each year. In 2023 alone, China experienced more than $42 billion in direct losses from climate change, according to the World Economic Forum.
Given the scale of the problem, many analysts said the size of the fund was still woefully inadequate.
“The $700 million is obviously insufficient,” said Jorge Moreira da Silva, the executive director of the United Nations Office for Project Services. “There is no further excuse to delay the full replenishment of the fund.”
In the first days of this year’s conference, world leaders called on rich nations to increase their commitments to the effort.
“We need significant contributions flowing to the loss and damage fund so it can have a meaningful impact,” António Guterres, the United Nations secretary general, said on Wednesday in Baku.
“This COP29 must deliver a clear process to ensure that necessary finance will be delivered to the loss and damage fund,” Prime Minister Feleti Teo of Tuvalu said on Wednesday.
The United States initially pledged $17.5 million to the fund.
“It’s a ridiculous amount,” said Liane Schalatek, who leads climate finance work at the Heinrich Böll Foundation, an environmental group associated with the Greens party in Germany.
Ms. Schalatek said the United States had a moral obligation to provide more, given its role as the largest historical emitter of planet warming gases. But the incoming Trump administration is not expected to commit any more money to the loss and damage fund.
“It should be a lot more, and obviously this is not going to be forthcoming,” she said. “Nothing is going to be forthcoming under the Trump administration. That’s not only for the fund for responding to loss and damage, but probably for most of the climate finance provisions.”
Mr. Diong said he hoped the United States and other nations would increase their commitments, but was not holding out for any one funder.
“We’re focused on the fact that there’s a diversity of funders,” he said. “This is about global solidarity. It’s not one country alone. Even though we have $720 million today, it needs to in the billions.”
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