Vulnerable states call climate loss and damage deal 'bare minimum'

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By Simon Jessop and Valerie Volcovici

GLASGOW (Reuters) - After a three-decade struggle, some of the world's most climate-harmed countries are inching closer to securing more help for the devastation caused by global warming.

The first call to address loss and damage caused by climate change came in 1991, when small island nations first pushed to create a mechanism to compensate vulnerable countries for destruction caused by climate impacts such as rising sea levels and supercharged wildfires. Rich nations resisted acknowledging financial liability for their years of emissions that drove climate change as they rose to economic prosperity.

The impasse continued through years of U.N. climate talks. But in a draft document released at COP26 in Glasgow on Friday, negotiators for the first time laid out a pathway for addressing the issue by establishing a dedicated agency. Yet the draft stops short of setting up a fund to compensate climate-linked losses and damage.

Some climate-vulnerable countries acknowledged the modest progress.

"There are some important hooks there that we can build on, but we still have a long way to go," said Simon Stiell, Grenada's minister for climate resilience and the environment, after a meeting on the issue. He called the draft proposal "the bare minimum" acceptable to vulnerable states.

Currently, the draft Glasgow agreement under discussion commits to realising within two years what was described as the Santiago Network during the last U.N. climate summit in Madrid in 2019, to "catalyse technical assistance" for developing countries to address loss and damage.

That would involve creating a separate secretariat under the U.N. Framework Convention on Climate Change, the draft says, referencing financial and technical support for its operations.

"That's the start of a breakthrough from the demands of vulnerable countries," said Yamide Dagnet, director of climate negotiations at World Resources Institute.

The loss and damage facility would be separate from the $100 billion a year pledged by rich countries toward helping developing countries quit fossil fuels and adapt to a warmer world.

But in the waning hours of negotiations in Glasgow, climate vulnerable countries and environmental campaigners said they will push for more. Beyond creation of a secretariat, they want a guarantee of a fund dedicated to help recover or rebuild when communities are destroyed by climate-driven floods, fires or drought.

The costs could be significant. Economists estimate costs from climate-related weather damage could total around $400 billion per year by 2030. A study commissioned by development agency Christian Aid estimated climate damage could cost vulnerable countries a fifth of their gross domestic product by 2050.

The United States and European Union have long resisted creating a fund for such payments, concerned about being on the hook for compensation and liability.

On Friday, U.S. Special Envoy on climate change John Kerry expressed support only for a secretariat's that offers technical support. EU climate policy chief Frans Timmermans was noncommittal, saying countries must "find the solutions" to enable vulnerable nations to deal with loss and damage.

Teresa Anderson, climate policy coordinator for the non-profit ActionAid International, said agreement on a funding mechanism should not yet be ruled out.

A separate fund "seemed out of the question coming into the COP, but in the last two weeks the tone has changed and it feels more possible now than it ever has," she said. "The U.S. remains the main blocker."

This week, Scotland offered the first-ever commitment from the industrialized world for such a fund, committing a somewhat symbolic 2 million pounds ($2.7 million).

The move impressed Saleemul Huq of Bangladesh, an advisor to the Climate Vulnerable Forum group of 48 countries.

Calling Scottish First Minister Nicola Sturgeon a "true leader," Huq lamented the lack of support elsewhere. "The U.S. is giving us $0. Europe is giving us zero euros."

(Reporting by Simon Jessop and Valerie Volcovici; Editing by Katy Daigle and David Gregorio)

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