Climate Lending Fund Proposed to Help Poor Countries Cope

The proposal to create a "global fund" that will allow developing countries to fight climate change came at the close of the three day long conference in Lisbon which attracted hundreds of delegates from government development agencies, nongovernmental organizations and civil society.

Commissioner Louis Michel proposes a global lending mechanism to ease the impacts of climate change on poor countries. (Photos courtesy European Community)

This lending fund, which could be managed by international institutions, would be wholly supported and financed by the richest countries.

"Let's come up with a creative way to design this global loan which would allow us the resources to deal with these climate issues," said Michel. "If we don't drive this forward through strong political decisions to get immediate results, we will find ourselves in the same place 15 years from now."

"In my view," said European Commission President Jose Manuel Barroso of Portugal, we are on the threshold of a new era, a transformation from a high carbon present to a low or zero carbon future."

"The European Commission is proposing a new alliance between the EU and the developing countries most affected by climate change and with the fewest resources to cope with its effects," Barroso said.

"If we miss our target of cutting CO2 emissions by at least 50 percent from 1990 levels by 2050," he said, "the consequences of climate change in social, economic and environmental terms could be both irreversible and uncontrollable."

"Climate change was seen as an environmental issue," Michel said at the opening session on Wednesday. "But now 200 million Africans may see their water supplies threatened and there could be food shortages due to reduced harvests."

Former UN Secretary-General Kofi Annan of Ghana told the delegates, "For far too long we have considered climate change as a problem for the future. But we must remember that climate change is an all encompassing threat. It is not an issue of rich versus poor, of north versus south. It's a global issue and we are seeing its effects everywhere."

Kofi Annan addresses delegates at European Development Days.

"There's an appetite for change in Africa, there is a young, dynamic group that is pushing for this move," said Annan. "Africa is moving in the right direction, but more needs to be done."

Leaving January 1 after a decade as head of the UN, Annan now serves as president of the Global Humanitarian Forum, whose first task will be to look at ways of helping the communities around the world that are most vulnerable to the effects of climate change. "Environmental change and natural disasters already displace more people than armed conflict," he said.

"A peaceful, prosperous Africa, a stable Africa is in all our interests," Annan said. "We stand on the cusp of change. We are all bound together as human beings. If we remain indifferent to the suffering of others, we are depriving ourselves of our own humanity."

At the panel entitled Climate Change Justice Beyond 2012, speakers from both climate change and development agencies agreed it is now clear that climate change and development are intrinsically entwined and must be considered in tandem when world leaders meet to hammer out a post-Kyoto agreement at the UN climate change conference in Bali in December.

The Bali conference is the next step in the effort to develop global standards for emissions of the greenhouse gas carbon dioxide after the Kyoto Protocol runs out in 2012.

Environment ministers from the European Union's 27 member states have now completed the EU's official negotiating position for the Bali conference, said Martina Klenner of the European Union's Environment Directorate General.

"We want a time schedule that leads to an agreement," she said. "We would like to see a roadmap on who will do what and in what timeframe. We would also like to see an agreement on which issues we will work on in the next two years."

Panel members stressed that a new agreement must include political and financial commitments to both mitigation and adaptation measures.

"Kyoto did not address adaptation measures," said Saleemul Huq of the nonprofit International Institute for Environment and Development. "Rich countries, which are most responsible for global warming, must pay, he said.

"If rich nations think they can shirk that responsibility and nothing will happen, they are wrong," Huq said. "There will be mass migration. People in rich countries may not care if people in Africa are dying, but they will care if they start getting in boats and crossing the ocean en masse. So whether they pay for the right reasons or the wrong reasons, it doesn't matter to me."

Yvo de Boer, executive secretary of the UN Framework Convention on Climate Change, UNFCCC, said that while a lot of funds are being created to fight climate change, access is predicated on following rules decided on by donors. This does not always benefit the people the funds are meant to help.

"When it comes to equity issues I am cynical," he said. "If governments were serious about it, they would be aiming for increasing ODA [overseas development aid] to 60 percent."

He said he also said that there seems to be two levels of conventions dealing with climate change: one for rich countries such as the UNFCCC, which deals with issues important to industrialized countries – and one for poor countries, such as the UN Convention to Combat Desertification. UNCCD, which deals with the effects of desertification and climate change in developing countries.

"The UNFCCC has a staff of 200 and a lot of money. The UNCCD has a staff of 35 and almost no money," he said.

De Boer said that he would encourage people from poor countries where climate change is most strongly felt to participate in the Bali discussions to ensure that their voices are heard loud and clear, and that their needs are clearly articulated.

Mozaharul Alam from the Bangladesh Centre for Advanced Studies said that the effects of climate change are apparent in Bangladesh, a poor country.

"We are already seeing more erratic weather and the vulnerability varies from region to region," he said. Floods, droughts and erosion are the most apparent results, but climate change is also affecting water quality, health, biodiversity and infrastructure.

"We are implementing adaptation measures for some of these problems," said Alam. "Adaptation activities are happening in many areas, but now they must be scaled up."

For example, in flood-prone areas, the nongovernmental organization Practical Action developed a technology to allow farmers to grow food on flooded land. A floating garden is built using water hyacinth, collected to construct a floating raft. This is covered with soil and cow dung, in which vegetables can be planted. A new raft must be built every year, but the old one can be used as fertilizer during the dry season, he said.

Kemal Dervis, administrator of the United Nations Development Programme made an impassioned plea for action on all fronts to combat climate change.

Kemal Dervis at European Development Days

In a special address on Thursday, Dervis said that we now have the science, but there is still uncertainty about the speed of climate change. To use uncertainty to justify inaction is wrong, he told participants.

"Uncertainty over how climate change will take place should spur us to action, not inaction," Dervis said. "We must take out global insurance against what could result in devastating, catastrophic changes for the entire globe."

"Besides long-term catastrophic effects, countries in the south, including small islands, are facing more frequent extreme events. It so happens that these most vulnerable peoples are the ones who are the poorest."

Given this extreme unfairness, said Dervis, "rich countries are faced with a huge ethical issue and the historical issue of responsibility."

An event today launched a new environmental and development initiative, Carbon against Poverty - a joint venture of two Portuguese entities, Oikos, a nonprofit organization specializing in development and cooperation issues, and Ecoprogresso, an environmental consultancy.

The aim of Carbon against Poverty is to promote strategies, projects and investments at local, regional, national and international levels for climate change mitigation and adaptation, which at the same time reduce poverty and support economic development.

The way to do this, said João José Fernandes of Oikos, is to use the carbon market to reduce poverty.

Fernandes described how Oikos is offseting carbon dioxide emissions from its own operations by funding a biomass electrical generation project in rural India, which provides employment for impoverished local residents.

At today's closing ceremony, Slovenian Foreign Affairs Secretary Andrej Ster express the view of many participants, saying, "Least developed countries and small island nations will be the most affected by climate change despite having contributed the least. For those who lack the capacity to adapt, we must step up to help."

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