The blackmail pros

I don’t know if any of you have watched The Cleaning Lady, a pretty decent TV series, but in case you don’t have time for watching TV series, let me just say there’s a lot of blackmailing going on. For some characters, it’s a way of reasserting power. For others, it’s a question of survival. Pretty much like what we’re seeing at COP27.

Climate reparations are all the rage at this edition of the summit, with poor nations demanding reparations for damage caused by the changing climate from the countries they argue are responsible for this changing climate: the developed world and, for the first time, China and India as well.

One could see this as blackmail although pretty much everyone at COP27 and outside it, for that matter, admits that developed economies have played the main role in climate change thanks to industrialisation, which was the thing that made them developed in the first place. Yet the admission was, until recently, where it ended.

Discussions of a loss-and-damage fund to help vulnerable nations deal with the effects of climate change they are already enduring, such as prolonged droughts, floods, and other extreme weather, have been reluctant, to say the least.

In fact, earlier this week, the developed nations’ group featuring the EU and the U.S. directly refused to pay up for the damage they openly admit was caused to developing nations. Of course they would, we’re talking about billions here. In a way, one could say the EU and the U.S. refused to be blackmailed. Because they’d like to do the blackmailing, it turns out.

The EU yesterday made developing nations an offer they can’t refuse. Maybe. The offer, as presented by Frans Timmermans, the eurocrat in charge of the Green Deal, suggested setting up a loss-and-damage fund, to be used to help vulnerable nations cope with the effects of climate change but only if they commit to phasing out fossil fuels.

That’s right. The EU would be happy to pay up but only if the beneficiaries of the pay-up promise to engage in emission reduction so that global emissions can peak by 2025 and reduce their use of fossil fuels. I’m sure the people who came up with the idea are really proud of themselves.

The proposal has yet to be fleshed out and finalised but I suppose vulnerable nations would do well to demand help with the fossil fuel phase-out because they would need it. Indonesia has already turned into an early adopter of the idea with the $20-billion deal it discussed with the U.S., the EU, and Japan this week.

Per plans, the money will be used to reduce Indonesia’s use of coal and replace the fossil fuel with wind and solar. Half of the total amount will come from the governments taking part in the deal and the rest should come from the private sector. It’s hailed as the biggest climate finance deal in history.

I’d speculate the Indonesia deal is a form of advertising, showing that the wealthy world is ready to throw billions at poorer countries with pleasure, as long as they make certain emission commitments because we are, after all, facing this huge existential crisis and the wealthy world wants the rest of the world to not cease to exist because they are just and equitable.

Why, then, did that same wealthy world refuse to even discuss the idea of reparations until now? Because they could, blissfully forgetting that all that talk about justice and equity, and how it’s the poorest that are suffering the most from climate change might lead to unintended consequences such as demands that those who caused the problem be the ones to pay for its consequences.

It is, however, remarkable, how long they held out in their refusal to discuss the reparations. In this Euractiv report from November 10, quotes abound from various officials saying talks about a loss-and-damage funds are off the table.

The quotes included one from none other than the European Commission’s chief advisor for international climate relations because this is now a thing, apparently, and fellow eurocrat to Timmermans, Jacob Werksman.

From the report: ““We are prepared to scale up support specifically to this challenge of loss and damage,” which hasn’t yet been addressed with sufficient “seriousness,” admitted Werksman, who heads the EU delegation at COP27.

But the new agenda item “was agreed under certain conditions,” he added, including that “we would not be discussing this issue of liability and compensation.””

A short week later, Timmermans proposes exactly what Werksman has declared will not be discussed: a loss-and-damage fund for poor countries struggling with the effects of climate change brought about by the industrialisation of now-developed economies.

Whatever could have changed over that short week? Nothing, is my guess. One week was how long the EU and their friends took to tailor the strings they would attach to their offer and they are pretty strong strings.

From the Bloomberg report linked above: “The European Union offer would include a commitment to immediately establish a new loss and damage response fund with details worked out over the next year as well as a commitment to examine debt and reform the multilateral development banks. There also would be a pledge to ensure all financial flows are aligned with the Paris Agreement commitment to keep global warming to 1.5 degrees Celsius.”

In other words, poor nations would only get money for things that advance the Paris Agreement agenda. From the EU perspective, that’s only fair. Also fair is the requirement that the beneficiary countries pledge to reduce their emissions footprint and agree to present evidence on a regular basis that their efforts in this respect are in fact advancing in the right direction.

I must admit this is an impressive sleigh-of-hand trick. Poor countries were asked to pick a card, any card, but the only card they were offered was “Reduce emissions or drown/starve/die of heat” that has a “Don’t complain or we’ll cut off the funding” warning on the back.

Poor nations, then, sort of trapped themselves. They will not be compensated for what damage they have already incurred because of climate change. They will be offered money to shift from fossil fuels to wind and solar, and only helped to manage their loss and damage if they agree to the shift. And if they refuse, well, someone else will take that money.

Again, from the perspective of the EU, the U.S., Canada, etc. this is perfectly fair. After all, they can’t pledge billions only to see them being spent on more coal mines or, gods forbid, refineries. But in addition to fair, the scheme could turn out to be quite profitable as well. So much new business for the right companies could open up if there’s a decent uptake among the poor nations.

See, for example this NBC report, which tells an interesting story:

“This money doesn’t normally stay on the African continent, or places where the money is needed most to solve problems,” Jonathan Gokah, a co-ordinator for Kasa Initiative Ghana, a climate campaign group based in the capital, Accra, said referring to Denmark’s pledge of $13 million in September. He added that pledges for finance from Western nations were often made with conditions that activists and communities on the ground work with international consultancies, creating jobs for international aid workers, not Ghanaians.”

I literally heard you say “So, what else is new?” just now and I’ve got no good answer, only a question: Why take the trouble to come up with something new when the old stuff works so well? I understand it could be a bit disappointing in a world so starved of creativity and originality these days but it makes sense. You don’t just throw away a perfectly good scheme that’s worked flawlessly for decades, do you?