COP27 in Egypt is boring, but that’s only because last year’s shindig in Glasgow netted SA $8.5 billion in funding pledges and brought the heat with crucial dialogue around the role of developed economies in the global decarbonisation effort.
This week, President Cyril Ramaphosa signed two loans with France and Germany for €600 million of that pledged amount.
Mzansi’s dealmaker-in-chief raised concerns that only 2.7% of the IPG funding package consisted of grants, and the South African delegation had appealed to the IPG to consider more grant funding, as the country already carries a sizeable debt burden.
President Ramaphosa was not the only developing market leader to raise concerns about the financing of the world’s eventual move to net zero.
Ramaphosa told the conference that the political will to gather financial resources was there, evidenced by around $17 trillion raised within two years in response to the COVID 19 pandemic.
“It is our task at this COP27 to harness the political will and mobilise the resources for the just transition,” he said. “The scale of climate finance must reflect the level of ambition.”
Developed countries are being criticised for their hypocrisy in requesting developing countries to transition from coal and other fossil fuels, at prohibitive cost, while those same countries were the ones that benefited most from the exploitation of fossil fuels and are responsible for the current state of the earth’s climate.
In her national statement at the opening of the conference, Barbados Prime Minister Mia Mottley said the global north borrows at interest rates of between one and four percent while the global south gets more punitive rates of 14%.
Outside of the formal sessions, activists added their voices to calls for the financing of “loss and damage” — reparations for countries directly affected by climate change.
Brandon Abdinor, climate advocacy lawyer at the Centre for Environmental Rights, said there were rising calls for the taxing of windfall profits earned by companies in the fossil fuel industry, so that the money that is need for reparations can be sourced directly from them.
Mottley had earlier called for a 10% tax on oil and gas producers to be paid into a loss and damage fund, along with contributions from developed nations.
Developed nations are predictably less than keen on the issue, fearing a flood of expensive lawsuits from developing countries.