Joëlle Welfring, Minister for the Environment, Climate and Sustainable Development; Credit: ©SIP / Yves Kortum

At COP27, Luxembourg pledged €10 million in financing for the "losses and damages" fund.

After fifteen days of intensive negotiations, the 27th Conference of the Parties (COP) under the United Nations Framework Convention on Climate Change ended its work on the morning of Sunday 20 November 2022.

In Sharm El-Sheikh, the global community was called upon to substantially advance international climate protection. Ambition and solidarity were the key words for the success of the conference.

Among the main results achieved in Sharm El-Sheikh is the creation of a new fund dedicated to the most vulnerable countries in the field of "loss and damage". "The creation of the fund represents a real breakthrough in the deadlock of global climate negotiations," said Minister of the Environment, Climate and Sustainable Development, Joëlle Welfring. The decision to create this fund is the direct result of the overture made by the European Union during its speech on Thursday evening, to accept this main request from developing countries for financial aid to poor countries, which will complement the many other efforts in this area.

The other strong demand from the European Union (EU), namely raising the level of ambition to reduce greenhouse gas emissions, in particular by gradually eliminating fossil fuels and fuels, has not succeeded. Supported by more than 80 parties, this proposal failed to persuade a large part of the major emitters in developing States, to the detriment of the most vulnerable countries and those most exposed to the devastating effects of climate change. According to Minister Welfring, "we must imperatively continue the reduction efforts at the next climate COPs in order to avoid the worst consequences of the climate crisis. This is supported by the unequivocal results of science and made evident by the effects of increasingly frequent extreme weather events".

Solidarity with developing countries most exposed to the consequences of climate change, and in particular the financing of the "loss and damage" suffered by these countries, where efforts to adapt to climate change are reaching their limits , nevertheless made it possible to bring a significant success to this "African COP" under the Egyptian presidency.

In this context, Luxembourg recalled that it had already increased its contribution to "international climate financing" from 2021. With an envelope of €220 million spread over five years following an increasing trajectory, Luxembourg is one of the main donor countries per inhabitant.

At COP27, Minisster Welfring announced that she wanted to allocate a considerable part of this envelope to the tune of €10 million to the financing of "losses and damages". This generally refers to funds, activities, projects and initiatives that avoid, minimise or address damage and loss.

Among these new financial allocations, Luxembourg has announced its willingness to support the Santiago network, created at COP25, to the tune of €5 million to coordinate efforts in terms of prevention, reduction and consideration of losses and damages. Luxembourg will also make a new financial contribution to the initiative on climate risk early warning systems CREWS in the amount of €1.5 million. In addition, a contribution to the "Global Climate Risk Shield" initiative developed by the German G7 Presidency and the Vulnerable Group of Twenty (V20) will be considered.

Beyond the new commitments in the area of ​​"loss and damage", Luxembourg is considering an additional financial contribution of €1 million to the Adaptation Fund (AF). Launched in 2007 to help the most vulnerable developing countries, this fund provides developing countries with simplified access to financial resources.

In addition, Minister Welfring took advantage of COP27 to conduct bilateral talks with several of her counterparts on bilateral international climate finance projects, as well as with the Director-General of the International Union for Conservation of Nature (IUCN), Bruno Oberle, the Executive Director of the Green Climate Fund (GCF), Yannick Glemarec, as well as the Executive Director of the United Nations Environment Programme (UNEP), Inger Andersen.

In the home stretch of the negotiations, the Czech Presidency of the Council of the European Union called on several ministers to represent the European Union. In this context, Minister Welfring was asked, together with her Dutch counterpart Rob Jetten, Minister for Climate and Energy, to take charge of matters relating to finance.