ECO, with our usual nose-to-the-ground ability to stay up to date on the latest and greatest, has heard of an exciting new intervention in the loss and damage space. More than 50 civil society groups, and notable people, have just released a Climate Damages Declaration – calling on countries to agree on a two-year workplan to develop adequate and predictable sources of revenue for loss and damage finance, including a Climate Damages Tax. What would a Climate Damages Tax be, we hear you ask? It would be an equitable fossil fuel extraction fee – levied globally, but with developed countries paying the lion’s share for loss and damage. Countries on the frontline of climate impacts would use the Tax at home for climate purposes. Who would pay and who would receive the funds would be based on a sliding scale.
Why on earth do we need new sources for more money? Well, at some interesting side events yesterday, ECO saw a graph depicting current development/humanitarian/climate finance versus future needs. And it turns out that tinkering at the edges, and a continued overemphasis on insurance, is not going to generate the scale of finance we need. We will instead need to think big with innovative sources of finance, such as a Climate Damages Tax.
The current overemphasis on insurance – and an assumption that poor people and countries are going to pay the premiums for climate insurance – risks shifting the costs of dealing with loss and damage away from the polluters and onto those suffering the impacts of climate change. Well designed, equitable and innovative sources of finance can meet CBDR-RC principle and reverse this damaging and unjust trend.
This kind of innovative solution for drastically upscaled finance for L&D is urgently needed at COP23 as negotiators from some developed country Parties seem to think that a measly UNFCCC budget of only US$700,000 allocated to the Executive Committee of the WIM is a sufficient outcome of the Pacific COP!
