Categories: Economic News

Amid geopolitical and economic stress, nations prepare for pivotal climate talks

Residents walk through a flooded village in the Philippines on October 30 after a tropical storm killed dozens. The effects of climate change are increasing the number and severity of natural disasters around the world.
Source: Jes Aznar / Getty Images News via Getty Images

It has been seven years since almost every nation signed a historic agreement to try to limit the rise in average global temperatures to 1.5 degrees C and avoid the worst impacts of climate change.

But when diplomats gather Nov. 6 in Sharm el-Sheikh, Egypt, for the United Nations’ COP27 climate summit, they must first take stock of what has not been accomplished since they met in Glasgow, Scotland , One year ago. At the time, all parties to the 2015 Paris Agreement on climate change agreed to present updated and more ambitious carbon reduction strategies by September 2022.

“What did we get? Twenty-three out of nearly 200 parties presented their revised climate plans,” UN climate chief Simon Stiell told a meeting of national leaders of vulnerable nations on 4 October underestimation”.

By the end of October, only a more revised plan, known as Nationally Determined Contribution, had been introduced.

“Under current policies, the world is heading for 2.8 degrees of warming by the end of the century,” warned United Nations Secretary-General António Guterres as his agency released a report that it showed the wide gap between current emissions reduction efforts and what nations need to do. to slow down global warming. “We are heading for a global catastrophe.”

Despite the deluge of gloomy messages as COP27 approached, expectations of progress on climate finance and other key goals for the summit were muted. But the choice of leaders to convene in Sharm el-Sheikhamid geopolitical challenges and fears of a global economic recession, that’s a success in itself, some observers say.

Compensation for loss, damages are great

Apart from increasing carbon reduction ambitions, one of the main items on the COP27 agenda is to negotiate a financing mechanism to help vulnerable nations adapt to the irreversible climate impacts occurring today.

The call for such support dates back to the early 1990s, when the Alliance of Small Island States first called for compensation for rising sea levels that threatened its existence. The campaign gained momentum during the 2021 climate summit in Glasgow, but progress has been uneven as wealthy nations with their own climate struggles pushed back.

The Oxfam group has loved that the it will be the damage and loss caused by irreversible climate change, such as the gradual rise of the oceans between $290 billion and $580 billion annually by 2030 as the economic toll of climate change grows.

Most vulnerable nations damage caused by irreversible climate change they are often the least responsible for global warming. A new study in the journal Advances in Science found that low-income regions lost 6.7% of gross domestic product per capita per year between 1992 and 2013 due to extreme heat, while wealthier regions saw a loss of GDP per capita of l ‘1.5%.

“Forty-eight countries in sub-Saharan Africa account for 0.55% of emissions and then there are 20 countries that account for 80% of all emissions – it’s pretty hard to argue there that you don’t have some responsibility to step up and make things happen,” John Kerry, the Biden administration’s top climate envoy, said at a Council on Foreign Relations event on Oct. 25. “But you have to make things happen that can work, that can be functional in your own political system, that can actually deliver money.”

The US will act in good faith, Kerry said, “and we need the unity of nations to move forward.”

The Union of Concerned Scientists and 142 other US organizations urged Kerry in a recent letter to “move beyond talk” in Egypt to move forward with the long-awaited damage and loss financing mechanism.

$100 million in climate finance pledged

The United States and other rich nations will also be under pressure at COP27 to fulfill their 2009 pledge to mobilize $100 billion a year in climate finance. The funding will help developing nations reduce greenhouse gas emissions and adapt to a changing climate. In 2020, developed countries collected $83.3 billion, up 4 percent from 2019 but still short of their pledge, according to estimates from the Organization for Economic Co-operation and Development.

Climate finance, as well as compensation for losses and damages, will require tough negotiations at a time when the world has been overwhelmed by inflation and supply chain problems during the coronavirus pandemic. Energy and food shortages following the Russian invasion of Ukraine have added to the pain and uncertainty.

These challenges “will have implications for countries as they manage these issues while trying to pursue ambitious climate goals and address adaptation issues,” said Steve Rose, a senior economist at the Electric Power Research Institute and leader. author of the climate adaptation report of the Intergovernmental Panel on Climate Change published earlier this year. “It’s important to keep that in mind.”

The panel’s most recent reports, to which hundreds of climate scientists contributed, will likely influence and inform talks at COP27, Rose said in an interview. The key conclusion of the Adaptation and Further Decarbonisation Pathway report is that even if greenhouse gas emissions were to stop today, climate change will continue for several more decades.

Scientific input can help COP27 negotiators focus on the key question of how to prepare for more climate risks as they try to fund the adaptation strategies that will be needed around the world, Rose said. Underlying these negotiations is the urgent need to curb the climate-warming emissions that caused the problem in the first place.

The 3 main broadcasters in the spotlight

The nations with the largest carbon footprints, China and the US, have frosty relations due to trade disputes and other long-standing political disagreements.

China, the world’s largest emitter of greenhouse gases with a population of 1.4 billion, has halted funding for new coal plants abroad but continues to invest in domestic plants to meet electricity needs and grow their economy. The country has said it will peak emissions by 2030 and be carbon neutral by 2060, a decade later than called for under the Paris Agreement.

Despite its rapid growth in renewable generation, China is still expected to rely on coal-fired power plants for 51 percent of its electricity needs by 2030, according to a recent analysis by S&P Global Commodity Insights.

India, currently the third largest issuer, posted an update Nationally determined contribution at the United Nations in August, saying it will reduce the emissions intensity of its gross domestic product by 45% by 2030. The nation, which has nearly as many people as China and huge electrification needs, maintained its plan to achieve net zero emissions. by 2070.

The Climate Action Tracker, an initiative of Climate Analytics and the NewClimate Institute that assesses the country’s emissions mitigation efforts, finds China and India’s actions to be “grossly insufficient”.

The US fares best in the survey, ranked in the “inadequate” category. That remains a significant improvement over the “critically insufficient” rating after former President Trump pulled the country out of the Paris climate accord and rolled back Obama-era climate policies.

Climate Action Tracker now finds the US national target to be ‘nearly sufficient’. During his first months in office, President Biden pledged to halve the nation’s economy-wide emissions by 2030 below 2005 levels and to reach net zero emissions by 2050.

Importantly, the US will come to COP27 with more credibility following the passage of the Inflation Reduction Act in August, the largest infusion of clean energy and climate investments in US history. As this funding begins to translate into action on the ground, it will signal to other countries that the US is within reach of its 2030 goal, according to Kelly Levin, head of science, data and systems change at Bezos Earth Fund.

“As we move into COP27 … this is one of the few places where we’ve started to see movement,” Levin said in an Oct. 21 webinar where the Bezos Earth Fund and several other organizations discussed a new report tracking global climate action. “I think the United States has at least something serious domestically.”

S&P Global Commodity Insights produces content for distribution in S&P Capital IQ Pro.


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