Climate and Gender Justice (ENG)

ANALYSEN

SUSTAINABILITY CLIMATE AND GENDER JUSTICE

WHAT‘S NEEDED TO FINANCE LOSS AND DAMAGE?

JULIE-ANNE RICHARDS CONTENTS

1 Introduction 2

2 What is Loss and Damage? 3 2.1 Gender Implications 3

3 Politics of Loss and Damage 7

4 What Is Needed for Loss and Damage? Solidarity and finance! 11 4.1 An Example. Fiji: Cyclones and Rising Sea Levels 12

5 What Would a Climate and Gender-Just Approach to Loss and Damage Finance Look Like? 17 5.1 Enough funds should be mobilized in a fair way: 17 5.2 Money Should Be Managed Transparently, with Vulnerable People in Control: 18 5.3 Money Should Help Vulnerable People Facing Climate Impact and Empower Them 18

6 Do Options for Loss and Damage Finance Meet a Climate and Gender-Just Criteria? 21 6.1 Sources of Finance 21 6.1.1 Climate Damages Tax 21 6.1.2 Carbon Pricing for International Aviation and Maritime Transport 21 6.1.3 Global Carbon Tax 24 6.1.4 Existing aid commitments 24 6.2 Financial instruments 25 6.2.1 Insurance 25 6.2.2 Contingency finance 26 6.2.3 Catastrophe bonds 26

7 Conclusions and Recommendations 28 2 1 INTRODUCTION

Loss and damage (L&D) is the poster solidarity. Meanwhile rich countries child for climate injustice. The inevitable have denied the very existence of loss outcome of rampant neoliberal capi- and damage, arguing that having your talism built on a system of making profits community destroyed in a climate fueled by exploiting the natural world and storm, your farmland turned into desert increasing inequality. L&D is the ‘exter- or your home inundated with sea level nality’ of fossil fuels and other polluting rise can somehow be covered by ‘adap- industries visited upon the people and tation’, and they have resisted all calls for communities who have done the least to compensation. cause climate change. Loss and damage has been a long Those with the least power and the running and deeply unfair battle, with least resources are the worst impacted. island countries and least developed This, of course, means that commu- countries calling for climate justice nities made vulnerable due to gender, on one side, and the most powerful, sexuality, race, class, age, legal status polluting countries denying their respon- and other intersections, are in the worst sibility for paying for the climate damage position to deal with the impact, and the on the other. A feature of the climate little they have is further eroded by loss negotiations since the beginning, a half and damage, more firmly entrenching decade of intense negotiations may be their inequality. Those dealing with L&D on the final stretch to address some of are desperately in need of international this injustice. 2 WHAT IS LOSS AND DAMAGE? 3

Loss and damage is when climate Loss and damage is being felt around change impact goes beyond the limits the world, including in rich countries. of adaption. If your island home disap- The string of devastating storms in the pears under rising seas you cannot US, the now year-round wildfire season adapt. If desert has encroached upon in California, the ‘sunny day floods’ in your ancestral land making it impossible Miami and other low-lying cities show to grow crops, you can’t adapt to that that even the most powerful nation on either. If an extreme storm destroys your earth cannot bend nature to its will. house and your community, we have But it is the poor countries and commu- moved beyond adaptation and into loss nities that suffer the greatest loss and and damage. damage. Africa is the most vulnerable Loss and damage is now considered continent, facing extreme tempera- the ‘third pillar’ of climate change, the tures, erratic rainfall, desertification and first being mitigation and the second flooding. Likewise, South and South-East adaptation. The Climate Action Network Asia face more extreme storms, more suggests three criteria, or guiding erratic monsoons – dumping immense questions, to help determine whether an amounts of water in short periods of impact is loss and damage: time – and sea level rise. And it is poor 1. Was the impact likely caused, or communities, with the fewest resources made worse or more pronounced, by to cope, who are most impacted. climate change? One measure would be if some or all impacts fall outside 2.1 Gender Implications of normal, historical parameters or if If a group has fewer resources and less they can be attributed either wholly or power it is likely to be more vulnerable partially to climate change based on to climate impact. Women and other established science. structurally disadvantaged groups are 2. Does it involve losses, including live- more vulnerable to the effects of climate lihood assets, loss of something the change than men and suffer greater loss community values and depends on, and damage. And they are frequently such as loss of fishing resource, loss of overlooked in planning solutions. ancestral land, loss of culture associ- To start with, women are more likely to ated with traditional activities and loss be poor and they therefore have less of the ability to undertake an activity resources to cope with the changing like the inability to herd cattle? climate. Women grow much of the 3. Does the impact require a signifi- family food but are likely to have access cant change in traditional or existing to the most degraded land with less livelihoods or way of life, going access to input like seeds, fertilisers and beyond adjustments that could be considered to be adaptation

and instead require an altogether 1 UN Women (2018) ‘Turning Promises into Action: Gender different reaction outside of the Equality in the 2030 Agenda for Sustainable Development’, available at ‘http://www.unwomen.org/en/digital-library/ realm of traditional approaches? sdg-report’, p. 119. 1 4 water and often without control over the they often suffer the worst impact, they land they till.2 also frequently step up to adopt roles Their place in society, and the gender as activists and leaders in responding norms that define it, increase women’s to climate impacts. For example, many vulnerability to climate impact. The role displaced or relocated women take of primary caregiver means that women on significant leadership roles in their are less able to react to disasters than communities and have become the main men. For instance, in the case of extreme breadwinners for their families. Whilst events women who are more likely to these roles can offer opportunities for have responsibility for children and the female empowerment, it is important to elderly move more slowly out of harm’s recognize that new leadership respon- way. They may also have less access sibilities can mean increased burdens to information about the impending on women, in addition to their already disaster, and less crucial skills, such as onerous responsibilities of both paid and knowing how to swim.3 This leads to poor unpaid work.8 Women work an hour a women and children being 14 times more day more than men and undertake three likely to be killed in a disaster such as a quarters of unpaid work in developing hurricane, typhoon or cyclone than men.4 countries under normal circumstances.9 Women are also more likely to be displaced Women and LGBTQI communities by extreme flooding, or other climate deserve more focus and more access to events, and when displaced they face an financing to address loss and damage so increased risk of violence.5 The needs of that they can play a leading role in devel- women, and LGBTQI communities, are oping and implementing solutions. often not taken into account in disaster

planning. For example, care packages 2 Women make up 43% of the agricultural labour force in routinely provided during disasters often developing countries and around 50 % in sub-Saharan Africa. However, only 15 % of land in sub-Saharan Africa is owned do not include female hygiene products, or managed by women, 13 % of landholders in India are although a ‘dignity package’ is sometimes women, 11 % in the Philippines and 9 % in Indonesia. Burns, B. ,European Capacity Building Initiative (ecbi) (2017), available provided for women despite the fact that at ‘https://wedo.org/pocket-guide-gender-equality-unfccc/’, p. 4. 3 Huyer, S. (2016) ‘Gender Equality in National Climate women are often the most frequent recipi- Action: Planning for Gender-Responsive Nationally Deter- ents of care packages.6 mined Contributions’, UNDP, available at ‚http://www.undp. org/content/dam/LECB/docs/pubs-reports/undp-Gender- LGBTQI communities are also often Responsive-Equality-National-Climate-Action-20161114. worse off than the rest of the population. pdf?download’. 4 UN Women (2018) ‘Turning Promises into Action: Gender Equality in the 2030 Agenda for Sustainable Sometimes bullied and blamed for the Development’, available at ‘http://www.unwomen.org/ en/digital-library/sdg-report’, p. 119. 5 Richards, J. and climate disaster by local religious figures, Bradshaw, S. (2017) ‘Uprooted by Climate Change’, Oxfam, or excluded from disaster responses that 2 November 2017, available at ‘https://www.oxfam.org/en/ research/uprooted-climate-change’. 6 UN Women (2018) are narrowly targeted at heterosexual ‘Crisis Update: Restoring Dignity and Livelihoods after Storms families, special effort is necessary to in the Caribbean’, 15 August 2018, available at ‘http://www. unwomen.org/en/news/stories/2018/8/feature-caribbean- ensure that loss and damage activities humanitarian-update’. 7 Dwyer, E. and Woolf, L. (2018) ‘Down by the River: Addressing the rights, needs and strengths of reach these groups who often suffer Fijian sexual and gender minorities in disaster risk reduction systematic discrimination that can be and humanitarian response’, Oxfam Australia, February 2018, available at ‘https://www.oxfam.org.au/oxfam-disaster-risk- 7 amplified in times of disaster. reduction-report-down-by-the-river/’. 8 Richards, J. and Women should not be seen as passive Bradshaw, S. (2017). 9 UN Women (2016) ‘Redistribute Unpaid Work’, available at ‘http://www.unwomen.org/en/ victims of loss and damage. Whilst news/in-focus/csw61/redistribute-unpaid-work’. 5 Shaila Shahad, Bangladesh, Senior farmers there has been a feminisation Programme Coordinator (Gender and of agriculture. As climate impact forces Climate Change) at International Centre migration to the city, it is men that move for Climate Change and Development whilst women stay behind to care for (ICCCAD) family, with their mobility discouraged. Bangladesh is a highly climate vulner- Although mobile phones are popular able country, where women and men and prominent, even in rural areas, and have different levels of vulnerability before a disaster the government sends to climate change. Women have warning messages over the mobile unequal access to resources and deci- network, women don’t have their own sion-making processes, with limited mobiles, they use their husbands’ or mobility in rural areas. Socio-cultural sons’. Information is also shared at norms also limit women from acquiring the market or tea stall, but women the information and skills necessary to don’t frequent them. Women clearly escape, avoid or cope with hazards. have less access to disaster or climate Frequent disasters and increasing water change related information. salinity damage water points and sani- The Bangladesh Government has taken tation facilities, increasing the time for steps to improve disaster management women to collect water from two to five broadly and gender discrimination hours a day. Salinity in soil and water in specifically. There are Union Parishad coastal region also impedes growing Disaster Management Committees set crops. Menstrual hygiene management up at the local government level. They is an issue in these conditions. A key must ensure a representation of women reason for girls to drop out of school is of at least 30 %. However, it is very that they don’t have access to safe water rare for women to be represented in to manage their menstrual situation. leadership positions, like that of Chair, In Bangladesh women are not formally Treasurer or Secretary. recognised as farmers, which creates Gender differences play roles in obstacles for women to gain access to non-economic loss and damage. A institutional support. The government significant portion of women’s contri- provides support for small farmers, butions are non-monetary: household including input support (for seeds, and neighbourhood farming, rainwater fertilisers and so on), but their lack harvesting, household work and care of a legally recognised status means work. In Bangladesh women’s roles they are not eligible in most cases. The are very dynamic, very robust and they Bangladesh Government has an agricul- have to manage a variety of things, tural strategy to distribute land to poor with little or no leisure time. When a people. In the coastal belt of Satkhira disaster occurs, the household support and adjacent areas we didn’t find a women have built can be destroyed single woman who has received land or lost, for example household seed from the government as a crop farmer. storage. In cost analysis immediately Despite this lack of recognition as after a disaster, these are not counted. 6 An assessment of loss and damage promises made under the Warsaw based only on monetary quantifications International Mechanism for Loss and may not take into account the value of Damage to mobilise finance, thinking women’s contribution. It is essential to beyond just disaster risk insurance, include qualitative indicators, like face- and agree on an innovative source of to-face interviews with women to get finance to address the impact of loss the full picture of how quality of life is and damage on vulnerable countries being impacted or hampered by climate like Bangladesh. Space must be built for change disasters and risks. women’s capacity-building and lead- Bangladeshi women need the inter- ership, using an equity and empower- national community to live up to the ment approach. 3 POLITICS OF LOSS AND DAMAGE 7

The politics of loss and damage is a denial campaign,13 designed to sow microcosm of broader climate change seeds of doubt on climate science and politics: an ideological battle between undermine policy action, has meant a neoliberal ‘green growth’ perspective that despite being responsible for 70 % that sees capitalism as an overall positive of emissions,14 an agreement to end the force requiring modest adjustments, extraction and use of fossil fuels has and a more reformist climate justice10 never been discussed within the inter- perspective, that sees rampant capi- national climate talks. Fossil fuels, coal, talism as the problem and seeks a system oil and gas are not even mentioned in the change. Climate justice demands the UN Framework Convention on Climate reconsideration of neoliberalism and its Change,15 the Kyoto Protocol16 or the built-in exploitation of nature and each Paris Agreement.17 This demonstrates the other, identifying the fossil fuel industry power and subtle tactics of this industry, as a key part of the problem. It sees and their state backers, to ensure addressing inequality, including gender that attention is directed elsewhere. inequality, that is driving an unequal society and excess consumption simul- 10 We used the Bali Principles of Climate Justice as articulated here: https://corpwatch.org/article/bali-principles-climate- taneously as essential. justice’. 11 Corneloup, I. and Mol, A. (2013) ‘Small Island These two competing perspectives have Developing States and International Climate Change Negotiations: the power of moral ‘‘leadership’’’, International formed the backdrop for a battle between Environmental Agreements: Politics, Law and Economics, the rich, industrialised traditional colonial November 2013, available at ‘http://link.springer.com/article /10.1007%2Fs10784-013-9227-0’; Parks, B. C. and Timmons powers of the ‘global north’ and the Roberts, J. (2010) ‘Climate Change, Social Theory and Justice’, Theory, Culture & Society, Nr. 27 (2–3), pp. 134–166, poorer, industrialising countries of the DOI: 10.1177/0263276409359018, p. 151. 12 Roberts, ‘global south’. The US and other wealthy J.T. (2011) ‘Multipolarity and the New World (Dis)order: US Hegemonic Decline and the Fragmentation of the Global countries have presented climate change Climate Regime’, Global Environmental Change, Nr. 21, pp. through a neoliberal lens, framing it as 776–784. 13 Greenpeace (2002) ‘Denial and Deception: A Chronicle of ExxonMobil’s Corruption of the Debate on Global an economic and energy issue that can Warming’, available at ‘https://www.greenpeace.org/usa/ 11 wp-content/uploads/2015/11/exxon-denial-and-deception. be solved with technocratic solutions. pdf?a1481f’; Union of Concerned Scientists (2007) ‘Smoke, They avoid reference to their historical Mirrors and Hot Air: How ExxonMobil Uses Big Tobacco’s Tactics to Manufacture Uncertainty on Climate Science’, emissions, or the economic model of available at ‘https://www.ucsusa.org/sites/default/files/ rampant capitalism based on fossil legacy/assets/documents/global_warming/exxon_report. pdf’; Centre for International Environmental Law (2017) ‘Smoke fuels, as the source of the problem. Rich and Fumes: The Legal and Evidentiary Basis for Holding Big Oil Accountable for the Climate Crisis’, available at ‘https:// countries have instead emphasised that www.ciel.org/news/smoke-and-fumes-2’. 14 Griffin, P. all countries have a responsibility to act.12 (2017) ‘The Carbon Majors Database. CDP Carbon Majors Report 2017’, available at ‘https://6fefcbb86e61af1b2fc4- These incredibly powerful countries c70d8ead6ced550b4d987d7c03fcdd1d.ssl.cf3.rackcdn.com/ would have us believe they are helpless cms/reports/documents/000/002/327/original/Carbon-Majors- Report-2017.pdf?1501833772’. 15 Other than in relation to to change their emission pathways, and ‘response measures’, fossil fuels are only mentioned to caution against applying measures to countries whose economies only market solutions are capable of rely upon fossil fuels. A reduction in coal, oil and gas is not solving the problem of climate change. mentioned. 16 Oil, gas and solid fuels (coal) are only mentioned in relation to the need to reduce their fugitive emissions, the This manipulation has been enabled emissions accidentally emitted on extraction, not in relation to by the most polluting industry on reducing their use. Kyoto Protocol: https://unfccc.int/resource/ docs/convkp/kpeng.pdf. 17 Paris Agreement: https://unfccc. earth: fossil fuels. A well-documented int/sites/default/files/english_paris_agreement.pdf. 8 Instead market-based solutions such as institution to deal with L&D the following emissions trading and offsetting have year.20 been favoured that have resulted in Just as the 2013 climate summit in continued emissions growth. Loss and Warsaw (COP19) was opening the damage negotiations have followed a hugely destructive Typhoon Haiyan21 similar path. decimated the Tacloban region in the Loss and damage was raised at the very Philippines, killing at least 6,300 people. beginning of the climate negotiations. It was the strongest typhoon to ever In 1991 Vanuatu, on behalf of the Asso- make landfall.22 Yeb Sano, the lead Phil- ciation of Small Island States (AOSIS), ippines negotiator, opened the meeting proposed compensating small island with a powerful statement that his family countries for damages from rising sea had been caught up in the typhoon and levels.18 Small island countries and the he was still waiting to hear from some Least Developed Countries (LDCs) of them. He pleaded for action, asking continued over the following decades to ‘if not now, then when? If not us, then make the case for compensation from who?’, declaring he would fast in soli- the worst impact of climate change, darity with his nation for the two weeks framing climate change as an issue of of the conference until a successful climate justice. Rich countries, on the outcome was agreed.23 This emotional other hand, have refused to entertain the statement drew the world’s attention very idea of compensation, deliberately to the issue and created pressure for a downplaying the concept of polluter positive outcome on loss and damage. pays and that their historical emissions This pressure propelled the years of are causing harm, again preferring a work from vulnerable countries to market-based solution: insurance. 19 success, and the Warsaw International After arguing for decades for compen- Mechanism for Loss and Damage (WIM) sation, which eventually came to be was established.24 called loss and damage, to be included The WIM was established with three in climate negotiations, it was the functions: to enhance knowledge; collapse of the Copenhagen negotiations strengthen coordination; and enhance and climate impact becoming more action and support, including finance.25 pronounced, that led to the first serious The WIM Executive Committee was set steps to develop a work programme up and has been meeting regularly since on L&D being agreed at the COP16 in

Cancun. This work programme included 18 Vanhala, L. and Hestbaek, C. (2016) ‘Framing Loss and a series of regional meetings assessing Damage in the UNFCCC Negotiations: The Struggle over Meaning and the Warsaw International Mechanism’, Global what loss and damage would mean in Environmental Politics, available at ‘http://discovery.ucl. Africa, Latin America, Asia and small ac.uk/1478385/’. 19 Roberts, J.T. (2011). 20 Vanhala, L. and Hestbaek, C. (2016). 21 Named ‘Yolanda’ in the Philip- island developing countries. Subse- pines. 22 At the time, it has since been surpassed by other stronger typhoons. Masters, J. (2013) ‘Super Typhoon Haiyan: quently, at the climate conference in Strongest Landfalling Tropical Cyclone on Record’, 7 November Doha in 2012 (COP18) a breakthrough 2013, available at ’https://maps.wunderground.com/blog/ JeffMasters/comment.html?entrynum=2573’. 23 Sano, N. was made as countries agreed not only (2013). Speech is available at ’https://www.youtube.com/ to continue the work programme on watch?v=7SSXLIZkM3E’. 24 UNFCCC (2013) Decision 1/ CP.19, available at ‘https://unfccc.int/resource/docs/2013/ loss and damage but also to establish an cop19/eng/10a01.pdf’. 25 Ibid. early 2014. It has since been widely crit- doors) developed country negotiators 9 icised for neglecting the third function have manoeuvred this initial mandate of the WIM, doing little or nothing to towards ‘financial instruments’, with enhance financing for loss and damage.26 market-based private sector instruments When the Paris Agreement was nego- the focus.30 tiated in 2015 loss and damage was Market instruments differ from solidarity included as a stand-alone element, with a finance of the kind that was envisaged full article devoted to it, widely seen as a with the language of the WIM Decision victory for vulnerable countries. Article 8 and the Paris Agreement. Market instru- of the Paris Agreement reinforces the ments place the bulk of responsibility need for financing for loss and damage. on the population at risk, rather than It states that countries ‘should enhance the international community.31 For understanding, action and support, instance insurance places responsibility including through the Warsaw Inter- directly on the communities at risk by national Mechanism, as appropriate, expecting them to pay an insurance on a cooperative and facilitative basis’ premium whereas solidarity instruments for loss and damage.27 This Agreement transfer responsibility to the international was hard fought: in the lead-up to the community, ideally taking into account Paris summit developed countries did a polluter pays approach. Gradually and not want to consider the idea that loss and damage would be incorporated in 26 Including: Richards, J. and Schalatek, L. (2017) ‘Financing Loss and Damage: A Look at Governance and Implementation 28 the Paris Agreement. Rich countries Options’, Heinrich Böll Stiftung, available at ‘https://www. did, however, insist on a statement in boell.de/en/2017/05/10/financing-loss-and-damage- look-governance-and-implementation-options’; CAN the accompanying Decision 1/CP.21 and BOND (2017) ‘CAN-Bond Joint Submission on the Strategic Workstream on Loss and Damage Action and saying that Article 8 ‘does not involve Support’, February 2017, available at ‘http://climatenetwork. or provide a basis for any liability or org/publication/can-bond-joint-submission-strategic- workstream-loss-and-damage-action-and-support’; Climate 29 compensation’, thus underlining the Action Network (2018) ‘Submission on the Scope of the need to ensure that funding is provided Technical Paper Exploring Sources of Support for Loss and Damage and Modalities for Accessing Support’, available at cooperatively. This statement does not ‘http://climatenetwork.org/sites/default/files/can_loss_and_ damage_submission_022018.pdf’; Gewirtzman, J., Natson, in any way undermine the actual need S., Richards, J., Hoffmeister, V., Durand, A., Weikmans, for financing nor the fact that countries R., Huq, S. and Roberts, J.T. (2018) ‘Financing Loss and Damage: reviewing options under the Warsaw International have agreed to provide it, in Warsaw, the Mechanism’, Climate Policy, available at ‘https://doi.org/10 Paris Agreement and in other Decisions .1080/14693062.2018.1450724’. 27 UNFCCC (2015) ‘Paris Agreement, Article 8’, available at ‘https://unfccc.int/sites/ as well. default/files/english_paris_agreement.pdf’. 28 Reyes, O. (2015) ‘Seven Flies in the Ointment of the Paris Climate Deal The Paris Agreement reinforces the Euphoria’, Global Justice Now, 15 December 2015, available initial WIM decision, which includes at ‘https://www.globaljustice.org.uk/blog/2015/dec/15/ seven-flies-ointment-paris-climate-deal-euphoria’; Stabinsky, calls to ‘enhance’, ‘facilitate’, ‘mobilise’, D. (2015) ‘Rich and Poor Countries Face Off over “Loss and or ‘provide’ finance or resources. The Damage” Caused by Climate Change’, 7 December 2015, available at ‘https://theconversation.com/rich-and-poor- emphasis and repetition makes the intent countries-face-off-over-loss-and-damage-caused-by-climate- change-51841’. 29 UNFCCC (2015) ‘Decision 1/CP.21, para. to generate and disperse additional 51’, available at ‘https://unfccc.int/sites/default/files/resource/ financing for loss and damage clear. docs/2015/cop21/eng/10a01.pdf’. 30 Gewirtzman, J. et al (2018). 31 United Nations Framework Convention on Climate However, though a series of non-trans- Change (2008) ‘Technical Paper: Mechanisms to Manage parent steps (as negotiations on loss and Financial Risks from Direct Impacts of Climate Change in Developing Countries’, p. 100, available at ‘http://unfccc.int/ damage finance are held behind closed resource/docs/2008/tp/09.pdf’. 10 over time, solidarity-based proposals, Protection which aims to help devel- including public sector interventions, oping countries ‘use risk financing tools taxation and transfers from developed like insurance and contingent credit’.35 nations to vulnerable countries, have In 2019 the WIM is due to be reviewed. been de-emphasised, whilst private This will no doubt be a hard-fought battle sector insurance-type interventions have between rich countries who want to been given a central role.32 emphasise insurance and place responsi- The WIM ExCom has shown a strong bility on vulnerable countries to ‘manage bias toward insurance schemes. In risk’ and pay insurance premiums and fact the only concrete outcome from vulnerable countries and civil society the WIM ExCom’s work on enhancing who will fight for the WIM to be fully financing is a clearinghouse (a website operationalised to meet its mandate of or wiki where participants can ask and ‘enhancing support, including finance’. voluntarily answer questions) which The WIM ExCom have already commis- focuses on insurance. sioned a technical paper, due mid-2019, Parallel to the work of the WIM is a to inform the review that will have a series of initiatives from rich countries negative influence. The outline36 shows to support insurance. These include that it will allow developed countries to InsuResilience Global Partnership,33 count essentially anything as loss and which came out of the G7 Climate damage financing, including already Risk Insurance Initiative and has as its existing aid (or Official Development objective to provide insurance coverage Assistance) funds. The technical paper to an additional 400 million poor will lack an assessment of the needs of and vulnerable people in developing vulnerable countries for loss and damage countries, the Global Risk Financing financing and is therefore likely to be an Facility (GriF)34 funded by the World exercise in greenwashing and making Bank, Germany and the UK to set up rich countries look good and will likely national disaster insurance programs, further poison the political atmosphere of and the UK’s Centre for Global Disaster loss and damage.

32 Gewirtzman, J. et al (2018). 33 Further information here: ’https://www.insuresilience.org/about/’. 34 Further information here: ’https://www.insuresilience.org/ world-bank-group-germany-and-uk-launch-145-million- financing-facility-to-support-earlier-action-on-climate-and- disaster-shocks/’. 35 Further information here: ’https:// devtracker.dfid.gov.uk/projects/GB-1-205231 https:// dfidnews.blog.gov.uk/2017/07/20/centre-for-global-disaster- protection/’. 36 Which can be seen here: ‘https://unfccc. int/sites/default/files/resource/ToR_TP_%20Final_210918_ version%200900hrs.pdf’. 4 WHAT IS NEEDED FOR LOSS AND DAMAGE? 11 SOLIDARITY AND FINANCE!

In order to address the question ‘what is ladesh, Pakistan, Vietnam, Thailand, the needed for loss and damage?’, the scale Dominican Republic). In fact, developing of the problem must be considered. countries face six times as much direct The 2018 Global Climate Risk Index from loss and damage from extreme events Germanwatch reports on damages from per unit of GDP than rich countries, extreme weather: storms, floods, heat losing USD 92 billion in total each year waves, etc. It is only a partial calculation of on average for the last twenty years.37 the annual loss and damage for countries, Eight countries suffer average losses as it only takes into consideration the of more than 2 % of their GDP annually: direct losses of extreme weather, not the Belize 3.2 %; Dominica 7.6 %; Grenada indirect impact (like food insecurity as a 7.5 %; Haiti 2.7 %; Marshall Islands 6.7 %; result of droughts), and it does not take St Kitts and Nevis 3.6 %; the Bahamas into account slow onset impact like rising 2.7 %; and Vanuatu 3 %. By comparison, sea levels. Nonetheless it shows that loss the US, a developed country highly and damage from climate-related events impacted by climate disasters, suffered is already having a significant impact on an average of USD 40.3 billion in losses developing countries. In the twenty year each year, which is a comparatively low period from 1997–2016 the ten countries 0.3 % of GDP. These numbers are only ranked with the most exposure to climate expected to grow as the global temper- risk were all developing (Honduras, Haiti, ature increases and the impact of climate Myanmar, Nicaragua, Philippines, Bang- change becomes more severe.

Table 1: The Climate Risk Index for 2016: the 10 most affected countries

Ranking Deaths per Absolute Losses Human De- CRI Death 2016 Country 100,000 losses in milli- per unit velopment score toll (2015) inhabitants on US$ (PPP) GDP in % Index 2015 1 (40) Haiti 2.33 613 5.65 3,332.72 17.224 163 2 (14) Zimbabwe 7.33 246 1.70 1,205.15 3.721 154 3 (41) Fiji 10.17 47 5.38 1,076.31 13.144 91 4 (98) Sri Lanka 11.50 99 0.47 1,623.16 0.621 73 5 (29) Vietnam 15.33 161 1.17 4,037.70 0.678 115 6 (4) India 18.33 2,119 0.16 21,482.79 0.247 131 7 (51) Chinese Taipei 18.50 103 0.44 1,978.55 0.175 Not included Former Yugoslav Re- 8 (18) 19.00 22 1.06 207.93 0.678 82 public of Macedonia 9 (37) Bolivia 19.33 26 0.24 1,051.22 1.334 118 10 (21) United States 23.17 267 0.08 47,395.51 0.255 10

Source: David Eckstein, Vera Künzel and Laura Schäfer, ‘Global Climate Risk Index 2018’, Germanwatch, https://germanwatch.org/de/kri. 37 Calculated using Table 7 in Eckstein, D., Künzel, V. and Schäfer, L. (2018) ‘Global Climate Risk Index 2018’, German- watch, available at ‘https://germanwatch.org/de/kri’, and the definition of developed and developing country, as Annex 1 and non-Annex 1 as in the convention in the UNFCCC. 12 As is clear from just this limited subset of of Fiji, demonstrating the risk that these loss and damage costs, the need for loss countries face, and that at the moment and damage financing is already signif- they are the ones who pay the price. icant. Broader estimates of the future cost of loss and damage and the need for 4.1 An Example. international finance include:38 Fiji: Cyclones and Rising Sea Levels – projected L&D costs in the range of On average Fiji’s annual asset losses USD 0.3 to USD 2.8 trillion in 2060 due to tropical cyclones and floods are with an annual average of USD 1.2 more than F$ 500 million, or 5 % of Fiji’s trillion (Hope 2009); GDP, which could increase by 50 % by – L&D costs for developing countries of 2050 (reaching 6.5 % of its GDP) and around USD 400 billion a year by 2030, even further by the end of the century. rising to USD 1.1 to USD 1.7 trillion a Unless action is taken to address today’s year by 2050 (Baarsch et al. 2015); high emission pathway, rising sea levels – global L&D rising to USD 4 trillion could mean that what are today 100-year by 2030 with developing countries flooding or storm surge events could bearing over 90 % of net losses (DARA occur on average once every two years and the Climate Vulnerable Forum’s by 2100.40 Climate Vulnerability Monitor II 2012); Tropical cyclone and floods also translate – L&D costs for Africa at just over USD into an average of 25,700 people being 100 billion per year by 2050, on top pushed into poverty every year (3 % of of adaptation costs of USD 50 billion, the population). Rare disasters have if warming is kept below 2 ºC (UNEP’s a much bigger impact: the 100-year Africa’s Adaptation Gap 2 report 2015). tropical cyclone would force almost The Climate Action Network therefore 50,000 Fijians, about 5 % of the total recommends that at least USD 50 billion population, into poverty.41 a year by 2022 be provided in interna- Other natural hazards – such as drought tional public grant financing for vulner- and landslides – were not quantified able countries to help them cope with but add to these risks. For instance, the loss and damage, increasing to approxi- economic losses caused by Fiji’s 1998 mately USD 300 billion a year by 2030.39 drought were estimated at F$ 275 million These numbers are presented to give to F$ 300 million. Loss estimates also an understanding of scale. The ‘at least’ didn’t take into account the increased should be emphasised as further work health costs of more dengue fever, is required, and care should be taken to diarrhoea, heat stroke and cardiovascular ensure that ceilings or constraints are not and respiratory diseases. 42 placed on finance or clever tricks played to make rich countries feel like they are ticking boxes and short-change the

most vulnerable people facing the worst 38 Estimates from Climate Action Network (2018). 39 Climate impact of climate change. Action Network (2018). 40 Government of the Republic of Fiji (2017) ‘Climate Vulnerability Assessment: making Fiji To better understand the vulnerable climate resilient’, 10 November 2017, available at ’http:// country’s experience of loss and documents.worldbank.org/curated/en/163081509454340771/ pdf/120756-WP-PUBLIC-nov-9-12p-WB-Report-FA01-SP. damage, below is the specific example pdf’. 41 Government of the Republic of Fiji (2017). 42 Ibid. 13 Ashmita Ashwin Kamal is a teacher at return to her school, which had suffered Bayly Memorial School, in Fiji’s Rakiraki severe damage: the roof of the school Province. had been ripped off, two classrooms As Cyclone Winston bore down on the were badly damaged and most of area in mid-February 2016 students the school’s resources – particularly were sent home due to the heavy rain books – were destroyed. and winds, and Asmita joined her family ‘I just felt like crying after seeing the in trying to prepare their home for what school’, reflects Asmita. ‘That school was to come. was beautiful. After the cyclone, I would ‘We tied the house down. We tried to say the school lost a lot of things. And it tie it three or four times, but it was really was not safe for the students to come difficult. As soon as my brother and and study in the school. All the students father came down from the roof and we and teachers were relocated to other went inside the house, half of our roof schools.’ was gone. Within seconds the other A year and a half after Cyclone Winston part of the roof was gone.’ Asmita’s home and school are being Asmita was tasked with protecting rebuilt. Asmita and her fellow teachers her elderly grandmother and younger regularly attend climate change brother and sister. For several hours, workshops to pass on the latest infor- they were at the mercy of the storm, mation to their students, including the huddled under furniture, waiting for the causes and impacts of climate change calm. and emergency drills focusing on storm ‘I was sad and scared. My grandfather preparedness. built that house when we were young, and everything was just gone.’ Source: World Bank (2017) Shaping the next generation of climate defenders: Asmita’s For Asmita, the heartache of losing story. 6 November 2017, https://www. her family home was compounded on ourhomeourpeople.com/#noqu-vanua

Although shockingly high, these below shows Fiji received roughly averages still disguise the enormous USD 188 million from the international costs of extreme events, such as 2016’s community, in a mixture of urgent Cyclone Winston. The overall loss and humanitarian funding, longer term damage from Cyclone Winston on public financing and loans, leaving the Fiji was USD 1.4 billion, roughly 30 % majority, roughly 85 %, of the cost to the of Fiji’s annual GDP.43 As the graph people of Fiji.

43 Government of Fiji (2016) ‘Post-Disaster Needs Assessment. Tropical Cyclone Winston, 20 February 2016’, May 2016, available at ‘https://reliefweb.int/report/fiji/fiji- post-disaster-needs-assessment-may-2016-tropical-cyclone- winston-february-20-2016’. 14 Fiji loss and damage from Cyclone Winston 2016: total loss and damage USD 1.4 billion

UN Flash Appeal, USD 22

Other funding, USD 14

Australia bilateral funding (cash + in kind), USD 27

New Zealand bilateral funding (cash + in kind), USD 10

EU bilateral funding (cash + in kind), USD 5

World Bank loan, USD 50

ADB loan, USD 50

Remainder of unfunded loss and damage, USD 1,203

Source: Author.44

The World Bank has estimated that – Establish a contingent line of credit for almost F$ 9.3 billion (almost 100 % of F$ 60 million. its GDP) in investments is required over – Purchase catastrophe insurance with the next ten years to strengthen Fiji’s an annual premium of F$ 2 million, resilience to climate change and natural with pay-outs for a greater than hazards for decades to come, both 1-in-10-year tropical cyclone. reducing risk and managing residual risk Let us leave aside how fair it is to expect by making the population better able Fiji to pay insurance premiums and to cope with and recover from shocks. increase their debt as a result of climate The proposed investments total approx- risk (issues to be explored later in this imately F$ 900 million per year in the paper). Even with these ‘improvements’ short term and F$ 954 million per year over the medium term.45 44 Data drawn from Mansur, A., Doyle, J. and Ivaschenko, O. (2017) ‘Social Protection and Humanitarian Assistance The World Bank models three financial Nexus for Disaster Response: lessons learnt from Fiji’s tropical cyclone Winston’, World Bank Social Protection and Labor instruments for Fiji to manage costs Discussion Paper Nr. 1701, available at ‘http://documents. related to disasters: worldbank.org/curated/en/143591490296944528/pdf/113710- NWP-PUBLIC-P159592-1701.pdf’ and World Bank (2016) – Increase the current contingency fund ‘Fiji Signs Loan Agreement with World Bank’, ADB, 18 July by F$ 3 million to create a reserve fund 2016, available at ‘http://www.worldbank.org/en/news/ press-release/2016/07/18/fiji-signs-loan-agreement-with- of F$ 4 million. world-bank-adb’. 45 Government of the Republic of Fiji (2017). Effect of strengthening social protection systems 15 after a 100-year tropical cyclone

Public Contingent Liability (F$ million)

300

250

200

150

Reserve Fund

100 Contingent Credit

Catastrophe Insurance

Unfunded Public 50 Contingent Liability

0 Average 1 in 50 year 1 in 100 year TC Winston Probabilistic Analysis

Source: World Bank calculations for Government of the Republic of Fiji (2017)

to Fiji’s funding of disaster response, 60 % increase in the social protec- such options leave the majority of the tion scheme boost. They estimate the cost, roughly 70 %, of a significant positive impact would be four times the disaster of the scale of Cyclone Winston average annual cost of F$ 3.8 million. unfunded. A fair approach to dealing But even this increase would still leave with loss and damage would provide the poorest people (the lowest quintile international loss and damage solidarity in the graph below) with big losses. As to address such a huge burden of climate women are more likely to be represented loss and damage on a small developing in the poorest quintile of the population country. this is, in essence, planning for women in There is further injustice within Fiji. The particular to be worst off after a disaster. costs of a severe cyclone, like Winston, The gender-just alternative is to build a falls disproportionately upon the poor. sufficient increase into the social protec- Fiji has a social protection scheme in tion scheme to protect the poorest from place that it boosted in the wake of all, or most, of the shock of the extreme Winston, providing households with event.46 cash pay-outs, which helped people recover from the cyclone much faster. The World Bank recommended a further 46 Ibid, p. 119–121. 16 Effect of strengthening social protection systems after a 100-year tropical cyclone

Well-being losses (F$ per capita)

3,000

2,500

2,000

1,500

1,000

500

0 Q1 Q2 Q3 Q4 Q5 Poorest Income quintiles Richest

No post-disaster support Winston-like response Wider & stronger response

Source: World Bank calculations in Government of the Republic of Fiji (2017), p. 121.

Stories from Cyclone Winston after TC Winston where she financially ‘Straight after TC Winston, whenever supported us while I had to stay back we came past these people, they home to look after nine people. I wish would call out that it is ‘us people’ that the government had procedures to give caused TC Winston. I asked them ‘what everyone the same so we could also get people?’ And they said LGBTQ people. housing assistance and humanitarian I told them it is climate change, not relief. Today we are still moving from LGBTQ people.’ place to place looking for a stable place ‘My house was completely destroyed to stay and live like a normal lesbian by TC Winston, then myself and my couple. If the housing assistance by the partner had to struggle with living government was granted to people like with my neighbour where we acted as us, we would have already built a house sisters and not a lesbian couple. […] for ourselves.’ My partner went back to work a month Source: Dwyer, E. and Woolf, L. (2018) 5 WHAT WOULD A CLIMATE AND GENDER-JUST 17 APPROACH TO LOSS AND DAMAGE FINANCE LOOK LIKE?

In order for a climate and gender-just and damage support is not motivated by approach to be achieved, loss and poverty reduction but rather by the harm damage finance should incorporate the caused by carbon emissions. As loss and following principles:47 damage is separate from adaptation, so finance should be separate from and on 5.1 Enough funds should be top of the current inadequate amount of mobilised in a fair way: adaptation finance (which is currently Scale adequate for need: As previously drawn entirely from the aid budget). It identified the scale of loss and damage must be transparently accounted for as finance need is large and growing, such. therefore a collective response of at least Precaution: The scale of need to address USD 50 billion by 2022 and USD 300 loss and damage is already obvious, billion by 2030 is an appropriate goal that demanding immediate steps be taken to should be continually assessed against raise the amount of finance necessary. needs. The absence of indisputable scientific Polluter pays: It is only fair that those evidence or methodological clarity responsible for causing harm are the ones should not delay the generation and responsible for paying for it. This principle disbursement of funding; both should is enshrined in international law and is progress simultaneously. expressed in the UNFCCC as the principle Respective capability: Funds should of ‘common but differentiated respon- be provided by those that can afford it. sibilities and respective capabilities’.48 A country’s obligation to pay for climate Those responsible are first and foremost damage (and other climate finance) rich countries, the fossil fuel industry and should be in line with a sustainable and other high polluting industries. universally accepted living standard for Predictable: International financing for citizens. When it comes to companies, or loss and damage should not depend other similar entities, paying for damage upon donors’ or contributing countries’ they have caused this principle is not changing priorities and conditions. relevant. Companies have declared bank- Recipient countries need to have ruptcy in order to avoid paying compen- planning security and sustainability through long-term financing. L&D 47 These principles are drawn from the following sources: Climate Action Network (2018), Richards, J. and Schalatek, funding generated from innovative L. (2018) ‘Not a Silver Bullet: Why the focus on insurance to financing sources such as levies or taxes address loss and damage is a distraction from real solutions’, Heinrich Boell Stiftung North America, available at ‘https:// provides that predictability in contrast us.boell.org/2018/08/30/not-silver-bullet’; Schalatek, L. and Bird, N. (2016) ‘The Principles and Criteria of Public Climate to – in the absence of assessed contri- Finance’, Climate Funds Update, November 2016, available butions – voluntary payments from at ‘https://www.odi.org/sites/odi.org.uk/files/resource- documents/11018.pdf’; and Johl, A. and Lador, Y. (2012) ‘A developed countries. Human Rights-based Approach to Climate Finance’, Friedrich Additional: Loss and damage finance Ebert Stiftung, February 2012, available at ‘http://www.ciel. org/Publications/ClimateFinance_Feb2012.pdf‘. 48 UNFCCC, should be additional to aid (ODA), as loss Article 2. 18 sation (asbestos) and in order to avoid Measurement and evaluation: At a clean up bills (coal). Governments have fund level, and at a project level, evalua- a responsibility to ensure companies tion of whether spending is meeting the don’t escape their responsibility to pay principles outlined here should be made for climate loss and damage they are publically available. responsible for. Cooperative and facilitative: The 5.3 Money Should Help Vulnerable Paris Agreement outlines that finance People Facing Climate Impact and (‘support’ in their terminology) for loss Empower Them and damage should be provided on ‘a Slow onset events and extreme events: cooperative and facilitative basis’. The to date they have received very little accompanying explanatory Decision says funding, which should be addressed. that the Paris Agreement doesn’t provide Human rights-based approach: a basis for liability or compensation. Measures in support of equality and the enjoyment of basic human rights 5.2 Money Should Be Managed (including right to food, adequate Transparently, with Vulnerable housing, clean water, health, culture) People in Control: should receive priority funding. And Vulnerable country and community safeguards should be in place to avoid ownership: Loss and damage finance the violation of rights or discrimination, should be driven by recipient country with transparent monitoring systems and community needs, not donor or and grievance mechanisms. contributing country preferences. This Gender equality approach: Preference should be reflected in the governance policies that offer co-benefits of gender of the funding instrument: rather than inclusiveness and equality and loss and being donor or contributing country damage objectives. Ensure that policies driven, the governance should at a very do not further entrench discrimination minimum be balanced with developing against women nor the unequal burden country membership (as the GCF is) or of climate impacts and the policies to dominated by vulnerable country deci- address them on women. For instance, in sion-makers (as the AF is). a community where predominantly men Transparency and accountability: fish and the fishing resource is lost due Processes should be inclusive and trans- to climate impacts, livelihood retraining parent, and individuals and communi- should be provided on a non-discrimi- ties informed of the potential impacts, natory basis, so as not to continue the ensuring that, where relevant, free, unequal position of women in society. prior and informed consent is provided. Local ownership, subsidiarity and Communities should have effective public participation: The provision opportunities to participate in decisions of loss and damage finance should and a means of recourse if the activities be driven by recipient country and cause harm. Loss and damage financing community needs. Financing decisions should be reported separately to ODA should be made at the local level as and adaptation finance without double much as possible, giving communi- counting. ties and affected people the possibility of meaningfully participating in the (country or community or individuals). 19 decision-making process. The deci- For example, loans to pay for loss and sion-making process should be gender damage from climate change that sensitive and ensure the participation of vulnerable countries had no role in indigenous peoples. would clearly be an unfair approach, and Equitable or direct access for the most therefore loss and damage financing affected: Loss and damage financing should be exclusively grants. Private should be directly and easily accessible insurance schemes should also be for all impacted countries, with special considered as to their appropriateness, provisions for those considered to be ensuring that there is not excessive prof- most vulnerable or affected. Within those it-making, that vulnerable countries and countries, finance for the most impacted, communities are not being forced to pay poorest and most marginalised popu- insurance premiums for a risk they did lation groups such as women, LGBTQI not create, that the schemes are not so communities, indigenous peoples should complex as to be not understandable to be prioritised. Direct access should be the countries, communities or individuals gender-responsive through approaches signing up for the insurance, that they that are more easily accessed by women effectively deal with basis risk (the risk of including small national and sub-national inadvertently insuring the wrong thing) grants, setting up community-managed and that they do not have the unintended funds or direct subsidies. consequence of entrenching inequality Appropriate: The financing instru- by assisting those with insurable assets – ments used to deliver loss and damage typically men – and leaving those financing should not impose an addi- without – typically women – compara- tional burden or injustice on the recipient tively worse off.

Tetet Nera-Lauron, Philippines, The decision to establish the Warsaw Advisor, Rosa-Luxemburg-Stiftung International was a 20-year uphill Manila representative office climb, especially for small island developing states, to recognise losses and A Matter of Climate Justice damages from human-induced climate The effects of climate change are not change and the struggle continues limited to developing countries, of today. Proportionally, the greatest course, but they’re a far bigger problem economic and climate-related loss for developing countries than for rich and damage occurs in low-income ones. The morose irony is that these countries. However, rich developed problems are not of their own making: countries have been up in arms it is the rich countries which reaped the reluctant to accept loss and damage benefits of fossil fuel-powered growth since the phrase evokes legal liability. that are causing climate change and are The term has become hugely important best able to shoulder its costs. to developing countries and climate 20 justice advocates at the negotiations itself a very difficult challenge, be it in and a big headache for developed sudden phenomenal disasters or in slow countries. onset events. But it gets even harder Loss and damage is basically what when one is to quantify non-economic happens when mitigation and adap- losses and damages: how do we put tation fall short and climate disaster a price tag on the loss of a homeland, strikes. I consider ‘loss’ to mean the biodiversity, ecosystems and culture, complete loss of lives, habitats and for instance? And how does one species: once these are lost, these respond to attendant problems that cannot be brought back. ‘Damage’ is come with extreme weather events, for those that may still be mended. At such as climate-induced migration? this point, no matter how much we cut It has been five years since Super emissions or how much we prepare Typhoon Haiyan (Yolanda) struck the for coming changes, there will still be Philippines and left a massive trail of significant losses and damages from losses and damage: more than 10,000 climate change. killed with millions of pesos in damages ‘Leaving no one behind’ is the devel- to livelihood and property. How does opment mantra, and this sense of one recover from the trauma of storm solidarity applies well to the concept surges engulfing one’s home? Who of loss and damage: that the global keeps the family together and cares for community does not leave those most its members? Who scrapes whatever affected and the poor to deal with the food and fuel is left behind and lets risks of climate change. But this also family members eat first? Who gets requires rethinking and reclaiming preyed on by the police and military solidarity and historical responsibility when they set up camp near evacuation as it means reining back those who centres or when they seal off areas and have gone too far ahead in terms of prevent the community from going economic growth at the expense of the back to their homes, which have been historical and continuing plunder of the declared ‘unsafe and unfit’ but have South through colonialism and neo-co- simultaneously promoted these coastal lonialism (made possible through unfair towns to rich foreign investors? Women and unjust trade deals, industrialisation, bear the disproportionate brunt of the investments and financial architecture). impact of climate change, and loss and Quantifying losses and damages is in damage demands a feminist solution. 6 DO OPTIONS FOR LOSS AND DAMAGE FINANCE 21 MEET A CLIMATE AND GENDER-JUST CRITERIA?

Whilst developed countries have empha- whereas 50 % of the revenue generated sised private-sector interventions to deal in rich countries would go to the interna- with loss and damage, solidarity-based tional loss and damage solidarity fund. proposals, including public sector inter- The concept has been widely supported ventions, taxation and North-South by civil society,50 and a number of vulner- transfers are being championed by civil able countries, including Dominica, society and vulnerable countries. The Seychelles, Bangladesh and Vanuatu options that have been proposed are have backed the idea.51 assessed below. 6.1.2 Carbon Pricing for International 6.1 Sources of Finance Aviation and Maritime Transport 6.1.1 Climate Damages Tax Fuels used for international aviation and The Climate Damages Tax (also known maritime transport (often called ‘bunker as the Carbon Levy or Fossil Fuel Majors fuels’) are currently exempt from fuel Levy) would tax the extraction of coal, taxation and their emissions are growing oil and gas, with the tax to be paid into faster than in any other sector globally. a global solidarity fund for loss and The UN High-level Advisory Group on damage. The idea is to make the fossil Climate Change Financing estimated fuel industry pay for the climate damage that a carbon price of USD 25 per tonne its products cause, addressing the on international transport emissions injustice inherent in the business model could generate around USD 30 billion in of the fossil fuel industry that outsources revenue annually, of which over USD 10 the true cost of their product to poor and billion could be used as a climate finance vulnerable people. contribution from developed countries. The Climate Damages Tax could raise Mechanisms to differentiate between revenues of between USD 150 and USD countries based on their level of develop- 1,000 billion a year, at a rate of USD 6 ment, capacities and responsibilities have per tonne of CO2e or USD 40 per tonne been proposed.52 Some options include: of CO2e respectively, and be applied – Applying a levy on the International globally. The proposal includes allo- Civil Aviation Organization’s (ICAO) cating the tax between loss and damage planned Carbon Offset and Reduction finance and just transition programs. The System for International Aviation tax would have the advantage of placing (CORSIA).53 a price on carbon, incentivising a shift away from fossil fuels. Its proponents, 49 For more on a Climate Damages Tax see: https://www. stampoutpoverty.org/cdt/climate-damages-tax/. 50 Climate however, emphasise the need for a range Action Network (2018) ‘Climate Damages Declaration’, November 2017, available at https://www.stampoutpoverty. of policies in order to phase out fossil org/cdt/climate-damages-tax-declaration/. 51 Isaac, J., fuel use by mid-century.49 It incorporates Jumeau, R., Mahmud, A. and Regenvanu, R. (2018) ‘When Will the World’s Polluters Start Paying for the Mess They Made?’, equity by allowing poor countries to use Climate Home News, 2 May 2018, available at ‘http://www. all of the revenue generated within their climatechangenews.com/2018/05/02/will-worlds-polluters- start-paying-mess-made/’. 52 Climate Action Network borders for domestic climate programs, (2018). 53 Climate Action Network (2018). 22 Table 2: Options for Loss and Damage Finance

Enough funds mobilized in a fair way: Help vulnerable people facing climate impacts & empower them Managed transparently & Appropriate/ driven by vulnerable country Local Polluter pays, from those that Slow onset Extreme Human-rights no additional Scale, additional, predictable & community needs Gender equality ownership/ can afford it events events safeguards burden or direct access injustice

Yes, potential to raise USD Climate Damages 75 to 500 billion a year, in a Yes, the fossil fuel industry, Yes, proposed as such Yes Yes Yes Yes Yes Yes Tax predictable way on top of with equity sliding scale. existing finance.

Potential. Solidarity levies Yes, for aviation as global have raised a small amount; Yes, depending on how Yes, if no net International elite fly. estimates up to USD 10 b implemented. ICAO and incidence Aviation and Yes Yes Could have Could have Could have per year for climate finance Yes, for maritime if a no IMO have not demonstrated system Maritime contribution. Additional and net incidence system strong transparency so far. implemented. predictable. implemented.

Potential. Global Carbon Yes, as long as well Yes, if well One estimate USD 40–50 If well implemented. Yes Yes Could have Could have Could have Tax b annually. Additional and implemented. implemented. predictable.

To some extent, as ODA No. There is already a contributors are historical Yes, if provided Existing aid considerable shortfall in aid/ polluters, but other polluters No Yes Yes Could have Could have Could have as grants not commitments adaptation/ humanitarian/ (like Saudi Arabia) not loans. DRR finance included.

No No, places No No, typically provides 1.5– No, premium cost primarily (typically very burden (unless 2 % of loss and damage. falls upon vulnerable at complicated of paying specifically Insurance So far int’l funds for present; if paid for by int’l No No Yes – and only premium on addressed insurance have come from solidarity funds that could understood vulnerable in overall aid, so not additional. change. by product countries or program) specialists) households.

At present funded by No (unless Not at present, if funded Depending Depending Contingency developing countries, which a change to by int’l solidarity funds that Yes Yes Yes on gov’t on gov’t Yes finance means it is not likely to be of fund with int’l could change. implementation implementation the scale necessary. solidarity funds)

Source: Authors, building upon work in Roberts, J.T. et al (2017) and Climate Action Network (2018). 23

No (unless Catastrophe No, likely to be of a scale No, at present funded by a change to bonds and similar Unclear No Yes Not clear Not clear No similar to insurance. vulnerable countries. fund with int’l instruments solidarity funds) 24 – Charging airline passengers a fee, resist the proposal. It would also require such as the one proposed in 2008 the establishment of an entity with the through the International Airline authority and capacity to implement the Passenger Levy (IAPAL). A modest fee tax, and the costs of enforcement and of USD 5–10 on international airline compliance would be significant. The tickets could be paid directly into the tax could be progressive, with developed Adaptation Fund.54 countries paying greater rates to be redis- – Extending the ‘solidarity levy’ ranging tributed among developing countries to from EUR 1 to 40 currently being defray costs.59 imposed on air passengers departing from nine countries, including 6.1.4 Existing aid commitments France, Cameroon and Madagascar. Current climate finance, including Currently, the approximately EUR 200 finance for adaptation, is largely drawn million per year in revenues from the from existing aid commitments. This is solidarity levy supports UNITAID, an despite the long-standing agreement in international drug purchase facility the UNFCCC that climate finance would that combats malaria, tuberculosis be ‘new and additional’. This has led to and HIV/AIDS in developing countries; the charge that rich countries are double an extension could generate more counting: counting support first as aid funds.55 and second as climate finance.60 – Incorporating a levy in the Interna- If rich countries get their way, this tional Maritime Organization (IMO) situation will get worse with loss and plans to reduce emissions by 50 to damage. The WIM Executive Committee 100 % by 2050.56, 57 has plans to draft a technical paper61 on sources of finance for loss and damage 6.1.3 Global Carbon Tax as input into the review of the WIM that A worldwide system of carbon pricing will allow developed countries to count could raise funds for loss and damage existing aid (or Official Development in the form of either a tax or auction Assistance) funds as loss and damage revenues generated from trading finance, encouraging double or triple schemes, such as the EU Emissions counting of finance, first as aid (ODA), Trading System (EU ETS). A carbon tax second as adaptation finance and then would raise funds that could be applied third as loss and damage finance. to financing loss and damage while 54 Roberts, J.T., Natson, S., Hoffmeister, V., Durand, A., simultaneously promoting substitu- Weikmans, R., Gewirtzman, J. and Huq, S. (2017) ‘How Will tion with cleaner energy sources. One We Pay for Loss and Damage?’, Ethics, Policy & Environment, available at ‘http://dx.doi.org/10.1080/21550085.2017.13429 estimate by the Swiss Government, 63’. 55 Roberts, J.T. et al (2017). 56 ‘https://www.scientifica- based on a levy of USD 2 per tonne of merican.com/article/u-n-agency-agrees-to-path-for-shipping- emissions-cuts/’ and ‘https://www.iea.org/newsroom/ CO2 emissions, projected revenues of news/2018/april/commentary-imo-agrees-to-first-long-term- plan-to-curb-shipping-emissions.html’. 57 Roberts, J.T. et al USD 40–50 billion annually. Proposals for (2017). 58 Ibid. 59 Ibid. 60 Weikmans, R. and Roberts, J.T. local taxes are many times that level so (2017) ‘The International Climate Finance Accounting Muddle: Is there hope on the horizon?’, Climate and Development, 58 substantial revenues are possible. available at ‘https://doi.org/10.1080/17565529.2017.1410 Establishing true global coverage is not 087’. 61 Which can be seen here: ‘https://unfccc.int/sites/ default/files/resource/ToR_TP_%20Final_210918_version%20 easy; many countries would inevitably 0900hrs.pdf’. This is in the context of an existing ‘gap’ Insurance Facility (CCRIF) makes pay-outs 25 in development finance, humanitarian for hurricanes over a certain wind speed. finance, disaster risk reduction finance The African Risk Capacity (ARC) pays and adaptation finance. The additional out if a certain amount of rain does not public spending needed to meet the fall. The pay-out does not have any direct Sustainable Development Goals (SDGs) relationship to the amount of damage, has been estimated at roughly USD generally climate insurance only pays out 1 trillion each year, a significant portion 1.5–2 % of loss and damage suffered.66 of which will have to come from aid,62 yet ARC and CCRIF are examples of current aid funding is only USD 131,600 sovereign level, or macro, insurance. million a year.63 Other forms of climate insurance include meso-level, where organisations such as 6.2 Financial instruments NGOs or credit providers take out climate 6.2.1 Insurance insurance, and micro insurance, in which Following wealthy countries’ emphasis individuals take out insurance.67 on ‘private sector solutions’ – which Micro insurance on its own is not a good often benefit the private sector to the option for the very poor and should be disadvantage of the public64 – has been combined with measures to lift people their emphasis on insurance. Insurance beyond a critical threshold, for example places the stress for dealing with extreme by complementing insurance with asset climate impacts on vulnerable countries accumulation programs. In an assess- and communities, focusing on risk ment of micro insurance schemes, MCII management rather than responsibility (2016) noted that it was not insurance for harm. It makes vulnerable countries alone that unlocked opportunities but and communities responsible for paying the interplay of insurance with other risk a premium to insure against a risk that management activities and social protec- they did not create. tion tools.68 There has been little assessment of 62 Martin, M. and Walker, J. (2015) ‘Financing the Sustainable whether insurance works. Some of Development Goals: Lessons from government spending on the MDGs’, Oxfam and DFI, available at ‘https://www. the enthusiasm for insurance may be oxfam.org/sites/www.oxfam.org/files/file_attachments/ misguided given that financial infrastruc- rr-financing-sustainable-development-goals-110615-en. pdf’. See table 2.2 additional public spending for the SDGs ture, regulatory frameworks and high- between USD 796 billion and USD 1.245 trillion, of which quality risk data are often inadequate or USD 60–100 billion is for climate adaptation. 63 OECD (2016) ‘Development Co-operation Report 2016: The Sustainable non-existent in developing countries.65 Development Goals as Business Opportunities’, 18 July 2016, available at ‘https://www.oecd-ilibrary.org/development/ Insurance has the advantage of providing development-co-operation-report-2016_dcr-2016-en’. 64 See funds quickly in disaster situations. for instance: Emmett, B. (2006) ‘In the Public Interest’, Oxfam and WaterAid, available at ‘https://www.oxfam. Climate insurance is often index, or de/system/files/20060831_inthepublicinterest_1916kb. parabolic, insurance where the insurance pdf’. 65 Weingartner, S. and Caravani, A. (2017). 66 Richards, J. and Schalatek, L. (2018). 67 RESULTS (2016) ‘Weathering is made against an event happening a Risky Climate: The role of insurance in reducing vulnerability to extreme weather’, 21 April 2016, available at ‘https://www. (or not happening) rather than against results.org.uk/sites/default/files/files/Weathering%20a%20 specific loss. This has the advantage of Risky%20Climate.pdf’. 68 Schaefer, L. and Waters, E. (2016) ‘Climate Risk Insurance for the Poor & Vulnerable: How to not needing assessments after the event, effectively implement the pro-poor focus of InsuResilience’, helping to make pay-outs quicker. For MCII, November 2016, p. 77, available at ’http://www.climate- insurance.org/fileadmin/mcii/documents/MCII_2016_CRI_for_ instance, the Caribbean Catastrophe Risk the_Poor_and_Vulnerable_full_study_lo-res.pdf’. 26 Insurance has a gender bias which However, without external funding, this benefits men: they are more likely to mechanism places the onus on govern- own higher value assets. Women are ments in vulnerable, less developed poorer and hence less able to afford the nations to set aside funds for contin- premiums. Subsidising premiums, or gency finance, leaving less in the coffers combining insurance with other social to address other pressing needs.74 security mechanisms, can counteract the potential spiral of deepening inequali- 6.2.3 Catastrophe bonds ties, including gender inequality and high Catastrophe (cat) bonds provide the opportunity costs of insurance premiums bond issuer with funds if a catastrophe for the poor. Insurance schemes often strikes. Cat bonds are investments with struggle to cover the most vulnerable, a specific set of conditions: if the bond and insurance may become the recipient issuer suffers from a certain pre-defined of resources that would otherwise disaster, the issuer’s obligation to pay be used for savings, risk reduction or interest or repay the principal to investors providing safety nets.69 or both is either deferred or forgiven. Cat Climate change may drive losses to a bonds may be issued by countries to level where they become too frequent, finance disaster response or by others, too costly or too unpredictable to such as insurers, to protect finances or insure.70 In addition, insurance is not an investment in the event of disaster. suited to slow onset disasters, like sea They generally have a higher cost and level rise.71 tend to involve stricter terms and conditions than traditional insurance. Cat 6.2.2 Contingency finance bonds only cover sudden catastrophes, Contingency finance, also known as not slow onset events.75 reserve fund or emergency funds, Other innovative bond instruments is budget allocation in case of an tailored to climate change impacts are emergency or disaster. The Bangla- being devised. For example, attribution desh Climate Change Trust Fund is an bonds would cover the component of example. The fund is maintained by the the probability of a natural disaster attrib- Bangladeshi government to finance utable to climate change, and sea level climate-related projects, with about 34 % rise bonds would provide dividends in of the annual endowment set aside for the event the mean sea level exceeds a emergencies.72 predetermined threshold. These bonds Contingency finance can make disaster currently exist only at the conceptual response more flexible. Setting aside stage.76 contingency finance allows governments to plan in advance and distribute finances earlier in the course of disasters.

Providing vulnerable households with 69 Weingartner, S., Simonet, C. and Caravani, A. (2017) assistance immediately after a climate ‘Disaster Risk Insurance and the Triple Dividend of Resilience’, ODI Working paper, Nr. 515, available at ‘https://www.odi. shock occurs, perhaps via boosted social org/publications/10926-disaster-risk-insurance-and-triple- safety nets, can stop households from dividend-resilience’. 70 Ibid. 71 Schaefer, L. and Waters, E. (2016). 72 Gewirtzman, J. et al (2018). 73 Ibid. 74 Ibid. 75 being pushed into poverty.73 Ibid. 76 Ibid. 27 Bridget Burns, Director, Women’s tive of trade, militarism, etc. to climate Environment and Development change. Organisation (WEDO) We already have an insight into how The organisations and activists countries are going to deal with the working on gender and climate change new climate reality. In the caravan trav- (the women and gender constitu - elling from Central America we see the ency at the UNFCCC) bring different pictures of the women and children perspectives, practical considerations fleeing from an untenable environment, and the analysis of how the forces and there are no policies in place to deal driving climate change interact with with this situation. Instead forces are one another. This approach will be trying to deal with it in a harmful and essential to develop an understanding potentially violent way. of how climate change loss and The women and gender constituency damage links to other forces such as have a programme called gender- migration and militarism, and how just climate solutions, showcasing investing in women, in new ways of tangible solutions to adapt to and doing things, can have a transforma- mitigate climate change taking gender tional impact. into consideration, with women-led, It starts with an understanding that low resource intensive programmes. climate disasters are gendered, that One of the stories we highlighted women and men are affected differ- was Ursula Rakova, who is coordi - ently by disasters and by non-economic nating her community in Papua New losses. Coping techniques and practical Guinea to relocate from the Carteret considerations are important, such as Islands that are disappearing under reducing violence rates in shelters, care water. This shows that we’re already packages provided post-disaster, jobs at the stage where we need to come that are provided in the community after up with solutions to deal with loss the disasters. But the conversation can’t and damage, including displacement, end with coping techniques: telling solutions that respect human rights women to tie their food to trees in the and demonstrate what a participatory face of a flood doesn’t get to the heart approach looks like. We need transfor- of the fact that spaces are becoming mational solutions that address, rather untenable to live in, that climate change than push aside, the power relations loss and damage is here. We need to within the community. A transform- give emphasis to broader issues, from ative approach places those most culture to livelihood. impacted front and centre, including The women and gender constituency a just transition perspective with the can look at loss and damage through communities significantly impacted a transformative lens, considering the from dirty energy or disasters. It is intersectional forces that need to be essential there be a process in place dealt with and bring a strong analysis that doesn’t recreate power imbal - of neoliberalism and a broad perspec- ances that existed beforehand. The 28 gender constituency brings this sion and inequality. We can’t properly perspective to the table. deal with climate change without The solution to climate change is not addressing the underlying drivers and Exxon owning the sun, without dealing without taking on the transformational with existing racism, sexism, oppres- opportunities.

7 CONCLUSIONS AND RECOMMENDATIONS

Loss and damage lays bare the false tive, and at a local level there are oppor- assumptions underpinning neoliber- tunities as well. alism: that the resources of the natural Ensuring that loss and damage does world can be inexhaustibly exploited. not further entrench disadvantages for This economic model, and the damaging women and LGBTQI communities will inequality that it is built on, is not require enough funds be mobilised in a compatible with our planet. To prevent fair way, driven by developing country climate change and address the ensuing and community needs that help and loss and damage we must embrace a empower vulnerable people facing polluter pays, rather than victim pays, climate impacts. The WIM must be in method and adopt solidarity as a guiding a position to deliver on this by meeting principle, including a just, and a gender- its founding mandate to enhance just, approach. financing. To start with, the pathway set out The review of the WIM, due to be by the IPCC 1.5 ºC Report to reduce conducted in 2019, should acknowl- emissions to net zero before the middle edge that it is not meeting this mandate of the century must be followed to the and address this by ensuring that at letter, with rich countries acting as first- COP25 countries are in a position to movers. In addition, more resources are fully operationalise the WIM and put a urgently needed to help communities mechanism in place to generate funding adapt to the climate change impacts that meets the criteria outlined in this that can be adapted to. But as loss and paper, including that it be adequate, damage is already being felt, and will providing a scale of at least USD 300 only get worse, rich countries must billion per year by 2030, that it be in change their tune and shift to one of addition to the already inadequate devel- solidarity with vulnerable countries opment and adaptation finance and that and communities, including women it be provided as grants and not loans. and LGBTQI communities. At an inter- As such innovative sources of finance national level, there are opportunities should be developed and implemented, for the UNFCCC and the UN Secretary including the Climate Damages Tax. General’s summit to address loss and This will require COP24 at Katowice to damage from a gender justice perspec- give guidance to the review, ensuring that the principles and process for should be given to developing a joint 29 2019 is clear. The process must first programme. Coordination with other and foremost include an assessment relevant bodies and work programmes of needs. Secondly the funds that are should also be considered, including being provided should be assessed the Local Communities and Indigenous as to whether they meet the climate Peoples Platform (LCIP). and gender-just approach outlined in Nationally, governments should promote this paper. For the significant gap that the voice and agency of women and will inevitably be identified, innovative LGBTQI communities in putting together sources of finance must be agreed and a loss and damage national plans by plan put in place for implementing them. including them on steering committees As currently commissioned the technical and decision-making bodies. Govern- paper being compiled by the UNFCCC ments should undertake climate-just on finance for loss and damage does and gender-just analyses of policies and none of this, and therefore the COP must programs using the principles laid out in commission further work to provide this this report and more specific indicators.77 input early in 2019. Additionally, the women and gender The WIM ExCom should build its own constituency should engage proactively capacity to address gender equality, on loss and damage, which has the through a programme of work in 2019 potential to deepen the already signifi- that ensures gender is addressed in cant level of disadvantage women and each of its workstreams. The WIM LGBTQI communities are facing. Work should work with vulnerable countries to in communities to identify the challenges develop guidelines for national loss and faced by women and LGBTQI commu- damage plans and include within them nities in relation to both extreme events a gender equality assessment and mile- and slow onset events and to identify stones for national governments as well ways to address these challenges is as recommendations for specific types essential. Continuing to expose the of projects to enhance gender equality fundamental inequalities that drive these within a loss and damage context. challenges, and working with communi- The UN Secretary General’s climate ties and governments to overcome them, summit in September 2019 must include is also vital. discussion of loss and damage, the Philanthropic organisations will need to gender discrimination in climate impact support this work, as traditional donor and recommendations about how to countries have been starving the area ensure sufficient financing is provided of loss and damage of funding for ideo- for loss and damage. This should include logical reasons. We recommend that polluter pays sources such as the Climate philanthropic organisations undertake Damages Tax.

The UNFCCC gender workstream should 77 Such as those in Glemarec, Y., Qayum, S. and Olshanskaya, address loss and damage as a specific M. (2016) ‘Leveraging Co-Benefits between Gender Equality and Climate Action for Sustainable Development: Mainstre- issue, and there should be capacity aming Gender Considerations in Climate Change Projects’, sharing between the Gender Action Plan UN Women, October 2016, available at ‘https://unfccc.int/ files/gender_and_climate_change/application/pdf/lever- and the WIM ExCom: consideration aging_cobenefits.pdf’. 30 their own learning programme on loss Julie-Anne Richards began working on climate and damage, with a view to establishing change in 2003, driven by the injustice of climate a target budgetary allocation for L&D change, a problem caused by rich and vested spending. interests but hitting poor people first and worst. Considering loss and damage and She has worked with civil society around the gender inequalities together can help world, including coordinating strategy and us understand the gravity of the climate policy for Climate Action Network International, crisis, spur action to prevent as much working with Oxfam Great Britain and Oxfam climate damage as possible, offer soli- Australia, and working with Pacific civil society. darity to the communities and countries She has written extensively on climate finance facing the worst impact of climate for loss and damage, displacement from climate change and undertake a transformational change, climate insurance, climate litigation, approach to a better world. coal and energy intensive industries. IMPRINT

ANALYSEN No. 51, 1st edition is published by the Rosa-Luxemburg-Stiftung Responsible: Ulrike Hempel Franz-Mehring-Platz 1 · 10243 Berlin · www.rosalux.de ISSN 2194-2951 · Editorial deadline: Dezember 2018 Editing: Nadja Charaby Graphs on pages 15 and 16 shared and adapted under Attribution 3.0 IGO (CC BY 3.0 IGO) license (https://creativecommons.org/licenses/by/3.0/igo/). Layout/Production: MediaService GmbH Druck und Kommunikation Proofreading: Ellison Moorehead for lingua•trans•fair Printed on Circleoffset Premium White, 100 % recycled paper ‘The politics of loss and damage is a microcosm of broader climate change politics: an ideological battle between a neoliberal “green growth” perspective that sees capitalism as an overall positive force requiring modest adjustments, and a more reformist climate justice perspective, that sees rampant capitalism as the problem and seeks a system change.’

JULIE-ANNE RICHARDS