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Dollars and euros at an exchange booth
Sweden is pushing for rich countries to come forward on their aid commitmentsImage: AP

Show me the money

July 28, 2009

Wealthy countries should spend more on poor nations to prove their good faith in upcoming climate talks, according to a draft European Union report. This comes as negotiations appear to be deadlocked over costs.


The draft report recommends an immediate $1-2 billion (up to 1.4 billion euros) to assist poor countries vulnerable to climate change, as a sign of good faith.

"A specific EU commitment is desirable before Copenhagen," the report said.

The report by the European Commission and Sweden, which currently holds the EU's rotating presidency, is expected to be finalized in the coming weeks.

It comes as EU environment ministers meet in Sweden to prepare for December's UN conference in Copenhagen, which is supposed to produce a strong treaty to tackle climate change.

Although prospects for a deal to limit greenhouse gas emissions have improved this year, with the US and China showing more engagement on the issue, the question of who should pay for fixing the problem remains divisive.

The so-called adaptation fund is one of the key areas of contention. It is supposed to help developing countries cope with global-warming-induced changes to their environment, which are expected to include the loss of arable land, pressure on water resources and a higher frequency of natural disasters.

There are concerns that developing countries will not be interested in pledging emissions cuts if the rich world doesn't help them pay for a problem largely blamed on the West's industrialization.

"Clarifying and increasing the global contribution to adaptation funding between now and 2012 could contribute significantly to trust-building with least developed countries," Sweden's draft report said.

A melting iceberg
Pacific islands are particularly at risk from rising sea levelsImage: AP

Put your money where your mouth is

It also calls on OECD countries to fulfill their existing foreign aid pledges, raising assistance from 0.3 percent of national income to 0.7 percent. This would amount to around $280 billion annually by 2015.

But in a suggestion likely to disappoint development advocates, the report recommends that contributions to the adaptation fund should only be made over and above current OECD aid spending, around $120 billion, not current OECD pledges.

"The big flows of money after Copenhagen, should be on top of that 0.7 percent," Oxfam climate campaigner Tim Gore told the Reuters news agency. "We must not divert funds that would otherwise be spent on schools and hospitals."

Oxfam wants the developed world to spend at least $50 billion per year on adaptation, on top of any regular aid payments.

Meanwhile, environmental activists have been meeting in the Bangaldeshi capital Dhaka to establish a common declaration on behalf of developing countries at Copenhagen.

"It is a matter of life and death for us," said the Bangladeshi Environment Minister Mostafizur Rahman, whose country is one of those most vulnerable to climate change. Around 20 percent of Bangladesh would be submerged if sea levels rise by one metre. Scientists fear that sea levels could rise by up to 88 centimetres this century.

Oxfam, together with the Australia Institute think tank, released a report on Monday warning that rising sea levels could trigger up to 75 million refugees in the Asia Pacific region over the next 40 years.

Editor: Chuck Penfold

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