- Two leaders called for windfall taxes on oil and gas companies to help fund climate efforts.
- The world is on a "highway to hell" unless countries step up action, the UN secretary-general said.
SHARM EL-SHEIKH, Egypt – Taxing the windfall profits of fossil-fuel companies. Debt relief for developing countries hit by climate-fueled natural disasters. Boosting climate finance above $100 billion a year like rich countries promised.
These were the calls of world leaders Monday at the UN climate summit — which came along with dire warnings about the state of climate action. The past eight years are on track to be the warmest on record, and countries are nowhere close to cutting greenhouse-gas emissions in half this decade, which climate scientists say is needed to avert catastrophic natural disasters.
"We are in the fight of our lives and we are losing," the UN secretary-general, António Guterres, said Monday in a speech in Sharm el-Sheikh, a resort city along the Red Sea. "We are on the highway to climate hell, with a foot on the accelerator."
Guterres said getting commitments from rich nations to pay poorer economies for the damages they'd already endured from climate-fueled disasters — known as "loss and damage" — was the litmus test for a successful climate conference. His comments were echoed by Barbados Prime Minister Mia Mottley, whose island nation is on the front lines of rising sea levels and more-extreme hurricanes.
Developing countries led by Pakistan secured so-called climate reparations as an official agenda item, setting up a debate with the US and the European Union, which have historically been opposed to discussing the issue. Whether the talks will yield serious funding is uncertain.
Wealthy nations aren't the only parties on the hook, Guterres and Mottley said. Oil and gas companies that are earning massive profits during a global energy crisis, spurred by Russia's invasion of Ukraine, should also be held responsible, the leaders said.
"How do companies make $200 billion in profits in the last three months and not expect to contribute at least $0.10 in every dollar profit to a loss-and-damage fund?" Mottley said.
That wasn't part of the policy agreed on by the EU in September to tax windfall profits made by fossil-fuel companies. The influx of cash would be aimed at helping to lower energy bills for consumers and partially funding the bloc's switch to clean energy. President Joe Biden last week accused oil and gas companies of "war profiteering" and called for a similar tax in the US, though it's unlikely Congress will take action.
Mottley is also pushing for a reform of multilateral development banks, including the World Bank and International Monetary Fund, which provide loans to countries — often in times of crisis. Mottley said wealthy nations borrowed at interest rates between 1 and 4%, while developing countries in the "global south" got hit with a rate of 14%.
The higher rates mean poorer countries spend more to repay their debt, including financing provided in the aftermath of a natural disaster like recent flooding in Pakistan. This drains budgets and leaves less money for infrastructure projects that make countries more resilient to the climate crisis. Mottley called for temporary debt relief in times of disaster.
Nearly 60% of the world's lowest-income countries were already in, or at risk of, debt distress before Russia invaded Ukraine, according to the World Bank.
"This world looks still too much like it did when it was a part of an imperialistic empire," Mottley said.