A long-sought disaster relief fund to help vulnerable countries weather the storm of climate change will start handing out aid next year, officials at COP29 in Baku said Tuesday.
"The fund for responding to loss and damage is ready to disburse funding," said executive director Ibrahima Cheikh Diong of Senegal as it was officially signed off in the Azerbaijan capital.
Its launch shows progress amid the tussle at COP29 between global North and South over climate finance.
The fund was agreed in a historic first at the last United Nations climate summit in Dubai last year to help developing countries rebuild in the wake of climate disasters.
Human-driven climate change is making floods, hurricanes and extreme weather events more ferocious and more frequent, scientists say. The nations of the South say they are the most impacted by the disasters, yet are the least responsible.
Mainly wealthy countries including Germany, France, the United Arab Emirates and Denmark have pledged to donate $722 million so far. Sweden was the latest nation to chip in, promising $20 million on Tuesday.
But the amount "doesn't come close to righting the wrong inflicted on the vulnerable" and "is roughly the annual earnings of the world's 10 best-paid footballers", said UN Secretary-General Antonio Guterres.
"It does not even account for a quarter of the damage in Vietnam caused by Hurricane Yagi in September," he said.
The damage from climate disasters can run into the billions and there is barely enough cash set aside for loss and damage at present to cover just one such event, experts say.
Developing nations had been pushing for a disaster relief fund to recover from climate impacts for the last 30 years, and the agreement struck last year was hailed as a major diplomatic breakthrough.
The fund now has a director and a board -- where developing countries enjoy greater representation than other international funds -- and is headquartered in the Philippines' capital Manila.
It is temporarily under the aegis of the World Bank, a move many poorer countries opposed.
Some estimates suggest developing countries need over $400 billion annually to rebuild after climate-related disasters. One study said the global bill could rise to between $290 billion and $580 billion a year by 2030 and keep rising.
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