CNN —
Aftab Khan felt helpless as torrential waters submerged a third of his native Pakistan.
Khan’s hometown was completely under water. His friend rescued a woman who had walked barefoot 15 miles through standing flood water with her sick child. And Khan’s own mother, who now lives with him in Islamabad, couldn’t drive home on washed-out roads to check her daughter was safe.
“These are heartbreaking stories, true stories,” Khan, an international climate change adviser, told CNN. “My heart was broken.”
Pakistan this year became the clearest example of why some countries are fighting for a so-called “loss and damage” fund. The concept is that countries that have contributed most to climate change with their planet-warming emissions should pay poorer countries to recover from the resulting disasters.
Earlier this year, Pakistan simmered under a deadly heatwave that made climate change 30 times more likely, according to the World Meteorological Organization. Now it is reeling from the aftermath of the worst floods in living memory.
The South Asian country is responsible for less than 1% of global emissions warming the planet, but it’s paying a heavy price. And there are many other similar countries around the world.
Loss and damage will be the focus of this year’s COP27 in Sharm el-Sheikh, Egypt, as low-emitting countries, swamped by floods or seeing their islands sink beneath the ocean, demand that high-emitting developed countries do pay for these damages.
But it’s been a contentious issue for years, as wealthy countries like the United States worry that agreeing to a loss and damage fund could expose them to legal liability and potential future lawsuits.
Climate activists in developing countries and a former senior US climate official told CNN that time is running out, citing Pakistan’s cascading disasters as the clearest proof why a special loss and damage fund is needed.
Developing countries are “unprepared to protect themselves and adapt and be resilient” to climate catastrophes, former White House climate adviser Gina McCarthy told CNN. “It is the responsibility of the developed world to support these efforts. Promises have been made, but they are not being fulfilled.”
As a concept, loss and damage is the idea that rich countries that emitted most of the planet-warming gases should pay for poorer countries that are now suffering from climate disasters they did not cause.
Loss and damage is not a new issue. Developing countries and small island nations have been pushing for these types of funds since 1991, when the Pacific island of Vanuatu first proposed a plan for high-emission countries to funnel money to those affected by sea-level rise.
It took more than a decade for the proposal to gain momentum, though much of Vanuatu and other small Pacific island nations are slowly disappearing.
More than $1 billion has been spent on relocating families in Fiji, the home island of climate activist Lavetanalagi Seru. Abandoning ancestral lands is not an easy decision, but climate change is having irreversible impacts on the islands, said Seru, regional policy coordinator at the Pacific Islands Climate Action Network.
“Climate change is threatening the very social fabric of our Pacific communities,” Seru said. “That is why these funds are needed. This is a matter of justice for many of the small island developing States and countries like those in the Pacific.”
A major reason this type of fund is controversial is that wealthy nations fear that paying for such a fund could be seen as an admission of liability, which could trigger litigation. Developed nations like the US have pushed it back in the past and still tiptoe around the issue.
Khan said he understands why rich industrialized nations are “dragging”. But he added that it’s “very important for them to empathize and take responsibility.”
There has also been confusion over its definition – whether loss and damage is a form of liability, compensation or even redress.
“‘Reparation’ is not a word or term that has been used in this context,” US climate chief John Kerry said in a recent call with reporters. He added: “We have always said that it is imperative for developed countries to help developing countries deal with the effects of climate change.”
Kerry has committed to having a fund discussion before a deadline of 2024 this year to decide what such a fund would look like. And US officials still have questions – whether it would come from an existing funding source like the Green Climate Fund or an entirely new source.
Kerry also sparked some controversy on the subject at a recent New York Times event when Kerry appeared to respond to a question on loss and damage by saying that no country had enough money to help places like Pakistan recover from devastating climate disasters recover.
“They tell me the government of the world has trillions of dollars because it’s costing them,” Kerry said at the event.
But others say the money is there. It’s more a question of priorities.
“Look at the annual defense budgets of developed countries. We can mobilize the money,” Alden Meyer, a senior associate at E3G, told CNN. “It’s not about the money. It is a question of political will.”
At COP27, the biggest debate will be whether to create a dedicated loss and damage financing mechanism – on top of existing climate finance to help countries adapt to climate change and transition to clean energy.
After climate-damaged nations called for a new loss and damage finance facility at last year’s COP26 in Glasgow, it will likely be an official COP27 agenda this year. But even if wealthier countries like the US and EU states have pledged to talk about it, there is not much hope that Sharm countries will come to an agreement on a fund.
“Do we expect to have a fund at the end of the two weeks? I hope I would like to do it – but we will see how the parties achieve that,” Egyptian Ambassador Mohamed Nasr, the country’s main climate negotiator, recently told reporters.
But Nasr also dampened expectations, saying if countries are still haggling over whether to put loss and damage on the agenda in the first place, they are unlikely to have a breakthrough on a financing mechanism.
He said it was more likely that talk of losses and damage would continue beyond the Sharm two weeks, perhaps the end of a framework put in place for a funding mechanism – or clarity on whether the funds could come from new or existing sources .
Some officials from climate-prone nations warned that if countries don’t reach an agreement now, the problem will be much worse later on.
“For countries that aren’t on the front lines, they think it’s a kind of distraction and that people should focus on mitigation,” Avinash Persaud, special envoy of Barbados Prime Minister Mia Mottley, told CNN. “If we had done damage control early enough we wouldn’t have to adapt, and if we adjusted early enough we wouldn’t have a loss of damage. But we didn’t do those things.”