Survival of small islands

Authors

Dr. Sindra Sharma-Khushal
Hon. Edwin Laurent 
​Dr. Ginelle Greene-Dewasmes 

Key Takeaways:

• Urgency for SIDS: COP26 must deliver on the 1.5°C target and meet SIDS' green finance needs, as current policies are inadequate and pose severe risks for these vulnerable nations.
• Key Negotiation Points: SIDS must push for stronger NDCs, operationalize Loss and Damage mechanisms, and secure equitable climate finance with a focus on adaptation and the unique challenges faced by SIDS.
• Private Finance and Partnerships: SIDS should engage in global private finance networks to ensure they benefit from green investments and decarbonization efforts, while advocating for tailored financial mechanisms to support their transition.

​The current emissions reduction policies are not sufficient to secure a climate safe future for all, and in fact will lead to devastating impacts for SIDS. Time is running out, only through bold and collective action can COP26 secure such a future.
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For the Survival of Small Island Developing States (SIDS), countries which are on the frontline of the impacts of climate change, COP 26 must deliver a scenario that at minimum delivers on the 1.5oC commitment and that guarantees their green finance needs are finally met.

In order to achieve at least the bare minimum best outcome at COP26 for SIDS, we recommend several strategic actions or positionings by SIDS’ negotiators and other relevant participating actors.

Key strategic positions for SIDS to be presented across every coalition that SIDS form

High Level messaging from leaders at Leaders’ Summit to G20 and major polluters COP26, is the last good moment for the World to stay within 1.5oC. Current submitted NDCs are insufficient. They do not bring us close to the temperature goal of 2oC, let alone 1.5oC which the scientific community has made clear is the only least bad option available for all countries. This will still be devastating for SIDS, any increment above 1.5oC now has an additional instrument in the form of the new Human Right to a safe, clean, healthy and sustainable environment through which to be challenged. Hence, every decision and conclusion made need to be 1.5oC compatible. If it is not, COP26 will without compromise, be declared a failure. Leaders can request a declaration on whether submitted NDCs are in line with a 1.5oC pathway. If they are not, the new 1.5oC aligned NDCs need to be submitted before the five-year ambition ratcheting mechanism.

Additionally, common but differentiated responsibilities need to be upheld with historic polluters accelerating efforts beyond the targets they have indicated. Furthermore, climate finance needs to be accessible and rapidly scaled, with adaptation finance being beyond 50% share of available climate finance. The UNEP Adaptation Gap Report quantified the cost of adaptation for developing countries in 2030 to be between USD140-300bn as such adaptation finance needs to grow exponentially. A portion of climate finance needs to be referenced for SIDS to ensure that SIDS, with their special circumstances, get a fair share. Also noting the debt burden of SIDS is unsustainable to address development and climate change adaptation - whilst this is not under the mandate of the UNFCCC process, it is important that any decision on finance considers the special circumstances of SIDS and the macroeconomic conditions they are exposed to which will hinder their ability to access the significant financial resources necessary to address climate change impacts. There is value for making such a case at COP as any favourable decision achieved here can provide weighting for concessions in other negotiations spaces such as the IMF.

Another critical area for SIDS is Loss and Damage (L&D). This must deliver by at the very least operationalizing the Santiago Network. In addition, it must be reiterated that L&D is not adaptation, but separate and distinct. Also important is the need for all elements of the Paris Agreement Rulebook to be finalised and aligned with 1.5oC – the substantial elements are Article 6, Common Timeframes, Enhanced Transparency Framework. 

Negotiator level positions on the more nuanced elements of the Paris Agreement

Under Article 6 of the Paris Agreement remains the need to finalize robust carbon markets and a rulebook that ensures environmental integrity consistent with 1.5oC. This is important in order to unlock new finance streams. In addition, the carbon markets regime should raise at least 5% proceeds to support the adaptation actions of developing countries particularly vulnerable to climate change. A need also exists to ensure that the rules of Article 6 lead us to 1.5oC with transparent involvement of the private sector. There is untapped potential for private finance to better and more innovatively incorporate the interests of SIDS. Developed countries should advance policies that more proactively encourage mutually beneficial green investments in SIDS’ markets. For instance, net zero public policy ideas compatible with existing frameworks such as the UK’s and EU’s Green Deal, can be incorporated by developed countries to stimulate developed country companies to invest in SIDS’ decarbonisation across the supply chain, as well as to invest in suitably and specifically outlined priority areas of Loss and Damage.
 
An enhanced transparency framework is also important. Modalities, procedures, and guidelines had been largely concluded at COP24. The remaining work to operationalise the Enhanced Transparency Framework is highly technical in nature and needs to be coordinated with Article 6 of the negotiations and its treatment of corresponding adjustments.
 
Loss and Damage has been repeatedly highlighted as an important area for SIDS and other most climate vulnerable countries such as the Climate Vulnerable Forum (CVF) and the Vulnerable 20 Group (V20). It is therefore crucial that L&D is devoted the necessary discussion space as part of the COP/CMA agenda. Ideally, all arrangements for the Santiago Network on Loss and Damage agreed at COP25 should be made operational at COP26. Specifically, the Santiago Network needs to address L&D at the technical and financial level, as well as a governance mechanism to address slow onset events separately. In addition, New and additional finance for L&D is being called for as is a call for a L&D envoy to be appointed by the COP26 Presidency and the UNSG to carry the discussion beyond CO26. A request is to have L&D addressed as a plenary issue every year. There is also a need for solidarity beyond insurance.
 
Another key focus would be finalising common timeframes for nationally determined contributions (NDCs). Eight options are on the table to be considered at the upcoming Subsidiary Bodies session with agreement to be reached on the length of the time frame, how it applies to developed and developing countries, and its synergy with other processes under the Agreement including the global stocktake and climate finance replenishment cycles. Important here is that the timeframe avoids locking in low ambition.
 
Advancement of SIDS’ Private Finance Negotiating Agenda outside the COP Blue Zone
 
Developed and large developing country actors are moving ahead to set the private finance framework outside the main negotiating COP arena. SIDS need to also strategically position themselves so that they ensure a say in its development. More SIDS should join relevant global platforms/ networks shaping the new global norms in private finance. For example, the International Platform on Sustainable Finance (IPSF). The IPSF aims to scale up the mobilisation of private capital towards environmentally sustainable investments. The network consists of SIDS’ major developed country trading partners such as the European Union (EU), the United Kingdom (UK) and Canada. However, currently no SIDS are members of the IPSF. Other relevant networks include: the Glasgow Financial Alliance for Net Zero (GFANZ), the UN-Convened industry-led Net-Zero Banking Alliance (NZBA- a sub-network of GFANZ), the Network for Greening the Financial System (NGFS), and the Net Zero Asset Managers Initiative.

Advancing A Strategic Private Finance and Private Sector Agenda Beyond COP26

Beyond the negotiating arena of COP, prioritisation should be made on exploring how to ensure SIDS’ private sector is not left behind or inadvertently made worse off by the evolving global private finance framework. Secondly, prioritisation should also be made on exploring exactly how the measures, incentives and platforms that encourage/ will encourage green investment by private finance entities and the private sector will lead to the required investment flows in SIDS’ decarbonisation. Thirdly, prioritisation should be made on determining how the ongoing work of organisations such as the UNFCCC’s Standing Committee on Finance (SCF), the Green Climate Fund (GCF), the SDG Investor Platform, B3W etc., can better serve SIDS’ specific interests via increased mobilisation of private finance. For example, under the GCF’s Private Sector Facility actions related to loss and damage have been financed.

 
Sources:
Sharma-Khushal, S., Laurent, E., & Greene-Dewasmes, G., 2021. Survival of Small Islands: Will COP26 Deliver? iDERA.  

Greene-Dewasmes, G., Laurent, E., & Sharma-Khushal, S., 2021. The Crucial Role of Private Finance and the Private Sector in SIDS’ Green Transition: The COP26 Agenda and Beyond. iDERA.
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