COP 27 or the 27th annually held United Nations Climate Change Conference ended on November 20 in Sharm el Sheikh, Egypt. COP is a series of annual summits attended by member countries that signed the United Nations Framework Convention on Climate Change (UNFCCC): a treaty that came into force in 1994 to tackle the deteriorating state of the planet due to adverse climate changes. It includes the clauses pledged under the Paris Agreement which was formulated in 2015 at COP21 and is adopted by 196 countries. This agreement is a legally binding international treaty on climate change and an active step in halting further deterioration. Its goal is to limit global warming to well below two, preferably to 1.5 degrees Celsius, compared to pre-industrial levels. This agreement provides a framework for financial, technical, and capacity-building support for countries that need it. To achieve these long-term temperature goals, countries aim to reach the global peaking of greenhouse gas emissions as soon as possible. This will also enable them to achieve a climate-neutral world by 2050. COP members meet every year so that they can discuss the improvement and see the progression. Developed countries are the main drivers of climate catastrophes since they are the ones who industrialised first and emitted the most amount of carbon into the atmosphere. They have also decided to work on early weather systems for controlling the deterioration of weather effects. Member countries also discuss novel solutions and research targets. Most countries have upheld their pledges, with the exception of Iran, where the emissions remain high. The ratification process to the committee is executed through the Kyoto protocol. This protocol operationalises UNFCCC by committing industrialised counties and economies in transition to limit and reduce greenhouse gas emissions in accordance with individual targets. The convention itself only asks those countries to adopt policies and measures on mitigation and to report periodically. Highlights from COP 27 The highlights of the outcomes cover all the areas of the Paris Agreement, which include finance, technology and mitigation. This includes US 100 billion pledged annually by developed nations to fight climate calamities and for strengthening the framework to curb greenhouse gas emissions. Stress was also laid on curbing the use of coal. It was also highlighted that global climate finance flows are small relative to the overall needs of developing countries, with such flows in 2019-2020 estimated to be USD 803 billion. This is 31-32 per cent of the annual investment needed (USD4-6 trillion) to keep the global temperature rise well below 2 °C or at 1.5 °C, and also below what would be expected in the light of the investment opportunities identified and the cost of failure to meet climate stabilisation targets Evidently, developed countries are the main drivers of climate catastrophes since they are the ones who industrialised first and emitted the most amount of carbon into the atmosphere. Moreover, in the last thirty years, developing countries have been asking developed countries to financially compensate for the damage global warming has caused to their economies. This includes extreme weather events like floods, drought, and extreme winds. At COP27, the discussions were intense and long, because developed nations continued to show resistance in pledging to provide compensation for the harm they have caused. However, after a two-week-long discussion, a deal was struck. According to this deal, member nations have decided to establish a “Loss and Damage” Fund that will assist developing countries, which are particularly vulnerable to adverse effects of climate change in responding to loss and damage. The formation of this fund is the highlight of COP 27 since the aim of this fund is to cover all costs incurred by climate change that go beyond what countries can adapt to or mitigate against. This agreement holds paramount significance because 2020 has been the warmest year on record, and 2011-2020 has been the warmest decade. The effects of global warming and the impact of temperature increase are evident through the increased frequency of climate catastrophes. However, there is clear ambiguity in this deal. The text issued by the United Nations does not clearly state the size of the fund. The committee includes 24 countries and the decision to decide the size of contributions from members. The beneficiaries are yet to be announced. Even though the fund has been promised, governments are yet to establish a “transitional committee” to make recommendations on how to operationalise new funding arrangements and the fund at COP28 next year. Parties also agreed on the institutional arrangements to operationalise the Santiago Network for Loss and Damage to catalyse technical assistance to developing countries that are particularly vulnerable to the adverse effects of climate change. Another positive development includes the initiation of the Global Shield funding mechanism. This was launched by the G7 group of wealthy nations and was backed by the Vulnerable 20 Group of Ministers of Finance of the Climate Vulnerable Forum. This agreement aims to facilitate funds. However, the funding for this is also unclear. At COP27, deliberations continued setting a “new collective quantified goal on climate finance” in 2024; taking into account the needs and priorities of developing countries. To summarise, on the technology front, COP27 saw the launch of a new five-year work program to promote climate technology solutions in developing countries. COP27 significantly advanced the work on mitigation aimed at urgently scaling up mitigation ambition and implementation. The work programme will start immediately following COP27 and continue until 2030, with at least two global dialogues held each year. Delegates at the UN Climate Change Conference wrapped up the second technical dialogue of the first global stocktake, a mechanism to raise ambition under the Paris Agreement. The UN Secretary-General will convene a “climate ambition summit” in 2023, ahead of the conclusion of the stocktake at COP28 next year. The decision text recognises that the unprecedented global energy crisis underlines the urgency to rapidly transform energy systems to be more secure, reliable, and resilient, by accelerating clean and just transitions to renewable energy during this critical decade of action. Developed nations have time and again failed at fulfilling their promises and providing the financial resources that are needed to slow down climate disasters. Even with the formation of the “Loss and Damage Fund,” it is unclear how soon these nations will respond. Another appalling factor at the moment is the situation of the global economy. With economies tightening worldwide and the destabilisation of major economic indicators, the liquidity situation seems unclear. However, this is a real eye-opener for developing economies like Pakistan, which can not bear the aftermath of any climate disaster. Millions have been displaced in Pakistan due to recent flooding. The impact on the economy has been uncountable, but still, nothing has been done in terms of preparedness. This is high time for the country’s politicians and governing bodies to pay attention to climate issues and formulate strict regulations to control the situation. The writer is a London-based Energy Economist and can be reached at aaimamehdi@gmail.com.