Still to be decided: How much money the fund should contain and where the cash should come from. At this point, the draft “invites” developed countries to lead in providing financial resources to start up the fund. None have yet provided firm pledges.
A deal on the first day would remove a long-running point of conflict from the conference agenda. That, in turn, would allow delegates to focus talks on the root cause of the carnage: the burning of fossil fuels. It would be a positive sign for a conference facing headwinds from geopolitical upheaval, a bullish fossil fuel industry, and climate activists’ complaints that a major petro-state is hosting the gathering.
But that will take a final agreement between almost 200 countries gathered for the beginning of the two-week conference.
The U.S., which has been the strongest opponent of financial redress for the damage from climate change, has not officially confirmed it will approve the deal. However, U.S. climate envoy John Kerry said on a call with reporters Wednesday that the Biden administration supports the fund and has “actively worked very hard to create it.”
“We think this fund — the way it’s designed — will meet the needs of vulnerable countries. We’ve worked hard with our partners to propose ways in which this fund can be stood up quickly but confidently,” Kerry said.
Kerry has proposed various means to raise private capital for the fund — one way of getting around likely Republican opposition to devoting money from the U.S. Treasury.
He also emphasized the administration’s view that the U.S., despite being the largest historical contributor of climate pollution, cannot be held legally responsible for the floods, fires and weather chaos that warming temperatures are unleashing around the planet. The United States has repeatedly rejected language that could be used to portray the fund as a form of reparations.
“It’s important the fund does not represent any expression of liability or compensation or any sort of new legal requirements,” Kerry said. “But it is going to try to be there for those in the developing world who have taken some of the brunt” of climate change.
If countries agree on the design of the fund, the focus will shift to how to raise the money.
Simon Stiell, executive secretary of the U.N. Climate Change office, said Wednesday in Dubai that talks must “put meat on the bone” of the fund.
“That means putting real money on the table. Table scraps won’t cut it,” he said in a video message.
An alliance of small island nations said this week that the fund should receive at least $100 billion over its first four years of operation.
But even the most front-footed of developed nations is floating numbers far below that. Denmark told reporters on Monday that “we’re talking hundreds of millions of course,” and that governments should put up at least $200 million at the summit.
That money would cover only the startup costs for the fund, one European diplomat said this week. The World Bank, where the fund would be housed at least temporarily, requires at least $200 million to get a fund up and running.
The U.S. and EU have pushed for the donor base for the fund to be widened beyond the traditional set of wealthy countries. They have specifically pressed China to become a donor, but Beijing has rebuffed that so far, saying it already contributes to developing countries through bilateral programs and so-called South-South cooperation.
Reporting contributed by Charlie Cooper from London. Karl Mathiesen also reported from London and Sara Schonhardt reported from Washington, D.C.