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The Five Upshots of COP27 – and Its Principal Triumph

The Five Upshots of COP27 – and Its Principal Triumph

A security personnel stands guard next to a COP27 sign at the COP27 climate summit venue in Sharm el-Sheikh, Egypt, November 20, 2022. Photo: Reuters/Mohamed Abd El Ghany

  • The chief triumph of COP27 was developing countries digging their heels in to defend the Paris Agreement against efforts by developed countries to ease or modify climate targets.
  • More specifically, developing countries maintained solidarity and ensured they set up a ‘loss and damage’ fund, after introducing the item in the agenda in a historic first.
  • Richer countries, led by the European Union, wanted to keep the Paris Agreement’s 1.5º C target alive at the cost of the principles of equity and common but differentiated responsibilities.
  • Richer countries also attempted to pass their climate finance responsibility on to developing economies and private parties.

Sameh Shoukry, Egypt’s foreign affairs minister, called the 27th Conference of the Parties (COP) to the UN Framework Convention on Climate Change (FCCC) in his country’s Sharm el-Sheikh an “implementation COP”.

That is, COP27 was meant to ensure the countries in the convention implemented both the Convention and the Paris Agreement in their true spirit. But by the time it concluded, it had become a meeting where the economically developed countries tried to undermine the Paris Agreement and developing countries tried to stop them.

The developed countries failed. The meeting created a fund that the richer countries would refill and whose resources poorer countries could use as reparations for the loss and damage suffered due to the climate crisis.

As such, even if it means most of the world’s countries have to spend a chunk of their time pushing back on developed countries’ desire for easier targets, the latter’s failures on several issues may just be the true success of COP27.

Here’s why.

A historic win

Developed countries came to COP27 aware that they’d be confronted with demands for a ‘loss and damage’ fund. It is meant to collect money to compensate countries for the damage they are already suffering due to the consequences of climate change.

To counter it, on November 14, richer countries led by Germany set up a non-UN insurance-based mechanism called ‘Global Shield’. Many developing countries saw it as an attempt by rich nations to not create a formal fund and not provide money directly to the nations suffering the most damages. All 134 developing countries in the G77 + China bloc stuck together to sidestep the ‘shield’ and have the ‘loss and damage’ fund set up.

Note that the fund per se isn’t ready; only an administering body has been created for now. The details of how the fund will work are to be worked out by December 2023.

What we do know is that the fund will provide assistance to developing countries “that are particularly vulnerable”, according to the final decision adopted on loss and damage at the summit. This qualification, as to how ‘developing countries’ are identified, leaves room for different interpretations and potential disagreement.

The ‘loss and damage’ fund is also an empty bucket for now. Money for the fund is expected to come from developed countries, international financial institutions, multilateral organisations and the private sector. The decision doesn’t state when the money will start coming in.

Many developed countries party to the FCCC had already pledged allocations for the fund – but have since directed a big chunk of it to the ‘Global Shield’. The details of how this insurance programme will work and whether it will complement the ‘loss and damage’ fund remain unclear.

So more negotiations are in the offing. The upshot is that developing countries made sure they kicked off the process at COP27 itself, instead of waiting until the next COP next year to do so.

Attack on the Paris Agreement

The Paris Agreement asks the world to ensure the world’s average surface temperature rise is kept under 2º C over pre-industrial levels by 2100. It urges countries to try to keep it even lower, to 1.5º C, which means countries will have to cut their greenhouse gas emissions more rapidly. And it asks countries to do so while ensuring developed countries take the lead and that all countries keep the process equitable.

Led by the European Union, the developed countries tried to pitch themselves as  champions in the quest to meet the 1.5º C target – but not once did they mention equity, the responsibility to share the onus in a fair manner and the common but differentiated responsibilities (CBDR).

Large developing countries, including India and China, were clear that they wanted any progress on meeting the 1.5º C target to go hand-in-hand with the principles of equity and of CBDR.

So as the developed countries opposed the references to equity in subsequent negotiations, the text around the 1.5º C figure in the final COP27 didn’t budge from what they agreed on in Glasgow last year: the banal statement that countries must accord importance to achieving the 1.5º C target.

Musical chairs on finance

Everyone knew climate finance was going to be the dominant agenda at COP27 before it began. After the COP26 in Glasgow last year, negotiators of the participating countries were looking forward to discussing the definition of climate finance, the $100 billion climate finance goal, and the interpretation of Article 2.1(c) of the Paris Agreement, which ties climate finance to low-emissions development.

Developed countries’ failure to mobilise $100 billion a year, as they had promised in 2009, for use by poorer nations became a rallying point for the latter at COP27. The final COP27 cover decision – the text that sums up the overall goals and targets of the COP meeting – expressed “serious concern” on the developed countries’ failure to mobilise the promised money.

In multiple meetings over climate finance in 2022, developed nations insisted that developing countries with larger economies – India and China in particular – should contribute to the climate fund as well. (Right now this is voluntary.) But India, China and others ensured the terms of the Paris Agreement and the FCCC weren’t altered in Egypt, leaving the onus on the developed countries.

Another key change that developed countries pushed for was to make Article 2.1(c) of the Paris Agreement more prominent. This didn’t work out, but if it had, climate finance from developed to developing countries would have been tied to commitments to low-emissions development – a contravention of the FCCC’s principles to keep climate finance unconditional.

Developing countries also countered the proposal by highlighting the lack of clarity on the definition of climate finance.

Ultimately, the two groups launched a continued programme called the ‘Sharm el-Sheikh dialogue’: among other things, it will organise two workshops to discuss Article 2.1(c) in 2023.

Little progress on adaptation

The UN established the ‘Adaptation Fund’ in 2001 to “finance concrete adaptation projects and programmes in developing country parties to the Kyoto Protocol that are particularly vulnerable to the adverse effects of climate change.” (The Kyoto Protocol requires countries to cut greenhouse emissions.)

The Glasgow pact had urged developed countries to at least double their commitments to the fund from 2019 levels by 2025. But at a meeting of the fund on November 9, developing countries said developed countries weren’t on track to meet their commitments.

According to a report by Third World Network, the group of African countries said richer countries continue to “abuse public trust and mislead the global community”. This was a dig at the US in particular, which has been participating in ‘Adaptation Fund’ meetings despite having pulled out of the Kyoto Protocol in 2001.

An adaptation-related bone of contention was the Global Goal on Adaptation (GGA). With 2022, one half of the time given to the Glasgow-Sharm el-Sheikh working programme on GGA, to further discuss adaptation goals, will have lapsed. Developing countries, led by the Africa group, said GGA discussions had progressed enough for a framework to be established this year. But the final decision stated that the framework will be adopted next year.

Developing countries’ demand to have the Intergovernmental Panel on Climate Change to prepare a special report on adaptation – as a scientific basis for negotiations – also didn’t make it to the final decision. Mentions of equity and CBDR, which developing countries had proposed as guiding principles, didn’t make it to the final decision either.

Upholding equity

At COP26 last year, countries had decided that there should be a separate track of negotiations to enhance mitigation. This is commonly called the mitigation work programme (MWP). But developed countries, led by the EU, were keen that the MWP track supersede other tracks where countries were assessing their mitigation efforts on the basis of the principles of equity and CBDR.

Several developing countries pushed back, and India and others ensured that the MWP track wouldn’t subvert the ‘Global Stock Take’ (GST) process installed under the Paris Agreement. The GST will evaluate countries’ progress under the agreement. (The first session of GST is scheduled for 2023.)

The developed countries also wanted to expand the scope of the MWP and include a focus on countries enhancing their mitigation ambitions in their ‘nationally determined contributions’. The developing countries countered that the idea goes against the Paris Agreement, which stipulates that these contributions should be voluntary, not the subject of mandates or diktats.

Developed countries were also keen to include sector-based mitigation: emission reductions by the type of economic activity – which also goes against the agreement, in which parties had agreed to let countries set their own mitigation targets.

Finally, developed countries were unwilling to address the question of the ‘means of implementation’ of mitigation actions guided by the MWP. This concept refers to the money and technology required to undertake mitigation actions. Instead, they insisted on increasing mitigation ambition without talking about the ‘means’.

The problem with this tack is that increasing mitigation ambition implicitly requires the use of expensive technologies. And the principles of equity and CBDR require developed countries to provide both to developing countries.

The result was a negotiation deadlock that ended with a compromise: the ‘means of implementation’ were left out of the MWP mandate. The MWP was thus reduced to a bunch of workshops over the next four years, and which will have to respect the outcome of the GST – as the developing countries had intended.

Radhika Chatterjee and Mrinali are researchers with Land Conflict Watch, an independent network of researchers studying land conflicts, climate change, and natural resource governance in India.

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