Tag: climate inequality - Page 2

Rich countries’ continued failure to honor their $100 billon climate finance promise threatens negotiations and undermines climate action

As global greenhouse emissions continue to rise, and climate change wreaks more havoc upon the people and places least responsible for the problem, rich polluting countries are now three years overdue on their promise to mobilize $100 billion a year in climate finance for low- and middle-income countries.

To make matters worse, says Oxfam, the actual support they provide is much less than reported numbers suggest, and is coming mostly as debt that has to be repaid.

Oxfam’s ‘Climate Finance Shadow Report 2023’ published today shows that while donors claim to have mobilized $83.3 billion in 2020, the real value of their spending was —at most— $24.5 billion. The $83.3 billion claim is an overestimate because it includes projects where the climate objective has been overstated or as loans cited at their face value.

By providing loans rather than grants, these funds are even potentially harming rather than helping local communities, as they add to the debt burdens of already heavily indebted countries —even more so in this time of rising interest rates.

Donor countries are repurposing up to one-third of official aid contributions as climate finance rather than putting forward new and additional money, while more than half of all climate finance going to the world’s poorest countries is now coming as loans.

Among bilateral providers, France has the highest share of its bilateral public climate finance through loans, at a staggering 92 percent. Other loan-heavy culprits include Austria (71 percent), Japan (90 percent), and Spain (88 percent). In 2019–20, 90 percent of all climate finance provided by multilateral development banks, like the World Bank came as loans.

“This is deeply unjust. Rich countries are treating poorer countries with contempt. In doing so, they are fatally undermining crucial climate negotiations. They’re playing a dangerous game where we will all lose out,” said Oxfam International’s Climate Change Policy Lead, Nafkote Dabi.

In the lead up to the Bonn Climate Summit (5 to 15 June), Oxfam also finds that climate-related development financing is largely gender-blind. Only 2.9 percent of all funding identified gender equality as worth prioritizing. Only one-third of climate finance projects in 2019-2020 mainstreamed gender, meaning that they took into account both women and men’s specific needs, experiences and concerns.

Oxfam estimates that the real value of funds allocated by rich countries in 2020, to support climate action in low- and middle-income countries was between $21 billion and $24.5 billion, of which only $9.5 billion to $11.5 billion was directed specifically for climate adaptation —crucial funding for projects and processes to help climate-vulnerable countries address the worsening harms of climate change.

“Don’t be fooled into thinking $11.5 billion is anywhere near enough for low- and middle-income countries to help their people cope with more and bigger floods, hurricanes, firestorms, droughts and other terrible harms brought about by climate change,” Dabi said. “People in the US spend four times more than that each year feeding their cats and dogs.”

Oxfam is highly concerned that adaptation funding is given too little attention when, in the past three years, India, Pakistan and Central and South America have all seen record heatwaves, in Pakistan later followed by flooding that affected over 33 million people, while East Africa is mired in its worst drought in over 40 years, contributing to crisis levels of hunger.

“Despite their extreme vulnerability to climate impacts, the world’s poorest countries, particularly the least developed countries and small island developing states, are simply not receiving enough support. Instead, they are being driven deeper into debt,” Dabi said.

The expectation that private investors can be mobilized by low- and middle-income countries to contribute a sizeable chunk of climate financing has not materialized, raising only $14 billion yearly, mainly for mitigation. Oxfam says it is difficult to find details on how this private finance is used or who benefits from it. According to a recent Organization for Economic Co-operation and Development (OECD) report, mobilized private adaptation financing rose sharply from $1.9 billion in 2018 to $4.4 billion in 2020, mainly because of a big liquefied natural gas energy project in Mozambique that does not reveal any adaptation activities.

Oxfam is highly concerned that funding for “loss and damage” —climate impacts that cannot or have not been mitigated or adapted to— still has no predictable place within the international climate finance architecture. Loss and damage finance needs are urgent, with estimates saying that low- and middle-income countries could face costs of up to $580 billion annually by 2030.

Oxfam says that ongoing deliberations under the UN Framework Convention on Climate Change (UNFCCC) to set a new global goal on mobilizing climate finance from 2025 onwards is a chance to rebuild trust between rich and low- and middle-income countries. But if past mistakes are not resolved and simply repeated, this initiative will have failed before it properly starts.

Climate finance providers should be massively scaling-up their efforts and be reporting climate financing on a case-by-case basis, highlighting the actual proportions channeled towards mitigation and adaptation. There is equally an urgent need for more grant-based financing for climate action, and less momentum toward loaning the money they have all promised to give.

Notes to editors

Download Oxfam’s ‘Climate Finance Shadow Report 2023’.

In East Africa alone, drought and conflict have left a record 36 million people facing extreme hunger, nearly equivalent to the population of Canada. Oxfam estimates that up to two people are likely dying from hunger every minute in Ethiopia, Kenya Somalia, and South Sudan.

The UN currently designates 46 countries as LDCs.

According to the OECD, mobilized private adaptation financing rose sharply from $1.9 billion in 2018 to $4.4 billion in 2020, mainly because of a big liquefied natural gas energy project in Mozambique that does not reveal any adaptation activities.

According to Anil Markandya and Mikel González-Eguino (2018), the costs of loss and damage in low- and middle-income countries could reach between $290 billion to $580 billion a year by 2030.

According to the American Pet Products Association, Americans spent $58.1 billion on pet food and treats in 2022.

800 percent increase in UN appeal needs for extreme weather-related emergencies – new Oxfam research.

The amount of money needed for UN humanitarian appeals involving extreme weather events like floods or drought is now eight times higher than 20 years ago — and donors are failing to keep up, reveals a new Oxfam brief today. For every US$2 needed for UN weather-related appeals, donor countries are only providing US$1.

Average annual extreme weather-related humanitarian funding appeals for 2000-2002 were at least US$1.6 billion and rose to an average US$15.5 billion in 2019-2021, an 819 percent increase.

Rich countries responsible for most of today’s climate change impacts have met only an estimated 54 percent of these appeals since 2017, leaving a shortfall of up to US$33 billion.

The countries with the most recurring appeals against extreme weather crises — over ten each — include Afghanistan, Burkina Faso, Burundi, Chad, Democratic Republic of Congo, Haiti, Kenya, Niger, Somalia, South Sudan and Zimbabwe.

The report, Footing the Bill, says that the increasing frequency and intensity of extreme weather events due to climate change is putting more pressure on an already over-stretched and underfunded humanitarian system. The costs of the destruction from these storms, droughts and floods are also increasing inequality; people in poorer communities and low-income countries are the worst hit yet they lack the systems and funding that wealthier countries have to cope with the effects. The richest one percent of people on Earth are emitting twice as much carbon pollution as the poorest half of humanity.

The UN appeals focus on the most urgent humanitarian needs, but that barely scratches the surface of the real costs in loss and damage that climate change is now wreaking on countries’ economies.

The economic cost of extreme weather events in 2021 alone was estimated to be US$329 billion globally, the third highest year on record. This is nearly double the total aid given by rich nations to the developing world that year.

The costs of loss and damage to low- and middle-income countries — for instance, the money needed to rebuild homes and hospitals or provide shelter, food and emergency cash transfers after a cyclone — could reach between US$290 billion and US$580 billion a year by 2030. This does not account for non-economic losses such as the loss of life, cultures and ways of living, and biodiversity.

UN appeals represent just a small part of the costs of climate disasters for people who are especially vulnerable and they only reach a fraction of the people who are suffering. Oxfam’s research shows that UN appeals cover only about 474 million of the estimated 3.9 billion people in low- and middle-income countries affected by extreme weather-related disasters since 2000, equivalent to one in eight people.

“Human activity has created a world 1.1˚C warmer than pre-industrial levels and we are now suffering the consequences. More alarming still, we will overshoot the 1.5˚C safety threshold on current projections. The cost of climate destruction will keep rising and our failure now to cut emissions will have catastrophic consequences for humanity. We can’t ignore the huge economic and non-economic losses and damages that underlie this picture — the loss of life, homes, schools, jobs, culture, land, Indigenous and local knowledge, and biodiversity,” said Oxfam Aotearoa Climate Campaign Lead Alex Johnston.

“This is the climate chaos we have long been warning about. Many countries that are being hardest-hit by climate change are already facing crises including conflict, food inflation, and the economic impact of the COVID-19 pandemic. This is leading to rapidly rising inequality, mass displacement, hunger and poverty,” said Johnston.

Humanitarian disasters affect men differently than women, who face long-standing inequalities that undermine their ability to cope. Women’s rights and progress towards gender equity are threatened with every disaster. The UNDP estimates that 80 percent of people being displaced by climate change are women.

“Poor countries cannot be expected to foot the bill, and increasing aid — while helpful — is not alone the answer. Paying the cost of climate-driven loss and damages should be on the basis of responsibility — not charity. Rich countries, rich people and big corporations most responsible for causing climate change must pay for the harm they are causing,” said Johnston.

Rich and industrialised countries have contributed around 92 percent of excess historical emissions and 37 percent of current emissions. Africa’s current emissions stand at just 4 percent; The Pacific Islands account for only 0.03 percent of global greenhouse gas emissions.

Kenya, Somalia, South Sudan and Ethiopia — where more than 24.4 million people now face severe levels of hunger and food insecurity — are together responsible for just 0.1 percent of current global emissions.

Rich industrialised nations have stymied loss and damage finance negotiations for years. At COP26 in Glasgow, they rejected developing countries’ calls for a new finance facility to address loss and damage and instead agreed to a three-year ‘Glasgow Dialogue’ to discuss future arrangements. “This just added insult to injury,” Johnston said.

Ahead of 56th sessions of the UNFCCC Subsidiary Body for Implementation (SBI) in Germany, which includes the first ‘Glasgow Dialogue’ on loss and damage since COP26, Oxfam urges:

Rich country governments like Aotearoa New Zealand to pledge bilateral finance to address loss and damage, in addition to existing climate finance and ODA commitments.
All governments to agree to establish and fund a finance facility for loss and damage at COP27, with annual contributions based on responsibility for causing climate change and capacity to pay.
All governments to agree to make loss and damage a core element of the UNFCCC’s Gender Action Plan.

Notes

Photos and video from Burkina Faso are available for download.

Download Oxfam’s brief Footing the Bill and our methodology note.

See also Oxfam Aotearoa and Oxfam Australia’s 2021 report titled Breaking Through Red Lines which outlines the loss and damage implications across the Pacific, and also includes loss and damage Māori communities within Aotearoa are experiencing due to climate destruction. The Pacific Islands is responsible for just 0.03 percent of global greenhouse gas emissions.

The countries with the most recurring appeals linked to extreme weather (Afghanistan, Burkina Faso, Burundi, Democratic Republic of Congo, Haiti, Kenya, Niger, Somalia, South Sudan, Uganda, Chad, Sudan and Zimbabwe) account for 1.4 percent of global emissions.

According to Aon, the total economic cost of extreme weather events in 2021 is estimated at US$329 billion globally, the third-highest year on record, behind 2017 and 2005.

Recent data from Oxfam shows that the wealthiest 1 percent of humanity are responsible for twice as many emissions as the poorest 50 percent, and that by 2030, their carbon footprints are in fact set to be 30 times greater than the level compatible with the 1.5°C goal of the Paris Agreement.

Rich nations provided US$178.9 billion in official development assistance (ODA) in 2021. This is equivalent to 0.33 percent of donors’ combined gross national income (GNI) and still below the UN target of 0.7 percent ODA to GNI.

According to estimations by Markandya and González-Eguino, the estimated costs of loss and damage by 2030 range from US$290 billion to US$580 billion, and according to Climate Analytics from US$400 to US$431 billion.

One person is likely dying of hunger every 48 seconds in drought-ravaged Ethiopia, Kenya and Somalia.