Climate "Loss and Damage": Pakistan Gets Flood Aid Pledges of $10 Billion

[RiazHaq]

Climate "Loss and Damage": Pakistan Gets Flood Aid Pledges of $10 Billion

Pakistan has received pledges of $10 billion worth of loans and grants to rebuild after devastating floods last year, according to Bloomber...

www.southasiainvestor.com

Pakistan has received pledges of $10 billion worth of loans and grants to rebuild after devastating floods last year, according to Bloomberg News. The amount pledged exceeds the $8 billion that Pakistan sought at the United Nations Donors Conference that concluded today in Geneva, Switzerland. The massive floods affected 33 million people living on vast swathes of land in rural Sindh and Balochistan. The flood waters killed an estimated 1700 people and millions of animals. The floods also washed away millions of acres of standing crops, tens of thousands of homes and thousands of kilometers of roads. The total flood damage is estimated at $33 billion, and cost of rebuilding at $16.5 billion. Prime Minister Shahbaz Sharif and U.N. Secretary-General António Guterres attended in-person, while world leaders such as French President Emmanuel Macron and Turkish President Recep Tayyip Erdoğan took part virtually.

​

UN Donors Conference For Pakistan Flood Aid in Geneva, Switzerland. Source: Reuters

UN Secretary General António Guterres has passionately advocated for immediate help for the people in Pakistan affected by the severe floods resulting from climate change. “We need to be honest about the brutal injustice of loss and damage suffered by developing countries because of climate change,” he told the gathering in Geneva. “If there is any doubt about loss and damage – go to Pakistan. There is loss. There is damage. The devastation of climate change is real.” Mr. Guterres added that people in South Asia are 15 times more likely to die from climate impacts than elsewhere, and his “heart broke” when he saw the devastation left behind from Pakistan’s floods. “No country deserves to endure what happened to Pakistan,” he said. “But it was especially bitter to watch that country’s generous spirit being repaid with a climate disaster of monumental scale.”

Jeddah-based Islamic Development Bank pledged $4.2 billion accounting for the largest share of the total amount of $10 billion. The World Bank pledged $2 billion, Asian Development Bank $1.5 billion, France $345 million, China $100 million, US $100 million, European Union $93 million, Germany $88 million and Japan $77 million.

At COP27, the United Nations climate summit, Pakistan led the fight for funding to compensate nations for “loss and damage”. Pakistan had the support of 134 developing nations. Earlier at COP26 in Scotland, discussions were mainly focused on funding "mitigation" and "adaptation", not compensation for "loss and damage".

​

Pakistan Pavilion at COP27 Conference in Sharm Al-Sheikh, Egypt

The "loss and damage" agenda item was first proposed by Pakistan during talks at Bonn after the country suffered heavy losses in unprecedented floods that hit a third of the country. “My country, Pakistan, has seen floods that have left 33 million lives in tatters and have caused loss and damage amounting to 10% of the GDP,” said Ambassador Munir Akram, the 2022 chair of the G77—a group of 134 developing countries, at the opening session of COP27 at Sharm al-Sheikh, Egypt.

​

Cumulative CO2 Emissions By Country/Region. Source: The World

Pakistan has contributed only 0.28% of the CO2 emissions but it is among the biggest victims of climate change. The US, Europe, India, China and Japan, the world's biggest polluters, must accept responsibility for the catastrophic floods in Pakistan and climate disasters elsewhere. A direct link of the disaster in Pakistan to climate change has been confirmed by a team of 26 scientists affiliated with World Weather Attribution, a research initiative that specializes in rapid studies of extreme events, according to the New York Times.

​

Top 5 Current Polluters. Source: Our World in Data

Currently, the biggest annual CO2 emitters are China, the US, India and Russia. Pakistan's annual CO2 emissions add up to just 235 million tons. On the other hand, China contributes 11.7 billion tons, the United States 4.5 billion tons, India 2.4 billion tons, Russia 1.6 billion tons and Japan 1.06 billion tons.

​

Pakistan's Annual CO2 Emission. Source: Our World in Data

The United States has contributed 399 billion tons (25%) of CO2 emissions, the highest cumulative carbon emissions since the start of the Industrial Revolution in the late 18th century. The 28 countries of the European Union (EU28), including the United Kingdom, come in second with 353 billion tons of CO2 (22%), followed by China with 200 billion tons (12.7%).

​

Cumulative CO2 Emissions. Source: Our World in Data

Pakistan's cumulative CO2 contribution in its entire history is just 4.4 billion tons (0.28%). Among Pakistan's neighbors, China's cumulative contribution is 200 billion tons (12.7%), India's 48 billion tons (3%) and Iran's 17 billion tons (1%).

​

Developing Asian Nations' CO2 Emissions. Source: Our World in Data

Pakistan has contributed little to climate change but it has become one of its biggest victims. In the 2015 Paris agreement on climate change, signatories agreed to recognize and “address” the loss and damage caused by those dangerous climate impacts, according to the Washington Post. In 2021, at the major U.N. climate conference in Glasgow, Scotland, negotiators from developing countries tried to establish a formal fund to help the countries like Pakistan most affected by climate disasters. It was blocked by rich countries led by the Biden administration. Pakistan finally succeeded in acceptance of "loss and damage" at COP27 conference in 2022. The UN-sponsored Pakistan Donors Conference in Geneva this year is an important milestone and a good start toward practically helping the victims of climate change in developing nations.

Related Links:

Haq's Musings

South Asia Investor Review

Catastrophic Floods in Pakistan

Pakistan Led "Loss and Damage" Demand at COP27 in Sharm El-Sheikh

Biggest Polluters Must Pay For Flood Damage in Pakistan

Cycles of Drought and Floods in Pakistan

Pakistan at 75: Economic and Demographic Progress

Dust Bowl in Thar Desert Region

Angelina Jolie Used Star Power to Help Pakistan Flood Victims

Bridge Collapse After Sudden Glacier Melt in Pakistan

Riaz Haq's Youtube Channel

PakAlumni Social Network

Climate "Loss and Damage": Pakistan Gets Flood Aid Pledges of $10 Billion

Pakistan has received pledges of $10 billion worth of loans and grants to rebuild after devastating floods last year, according to Bloomber...

www.southasiainvestor.com

 

[K_Bin_W]

If I add all the pledges that were made I will have to buy a powerful calculator to add the numbers. A pledge is a pledge and that's all.

 

[RiazHaq]

Pakistan: Flood Damages and Economic Losses Over USD 30 billion and Reconstruction Needs Over USD 16 billion - New Assessment

https://www.worldbank.org/en/news/p...uction-needs-over-usd-16-billion-new-assessme


Post-Disaster Needs Assessment calls for urgent support to implement a Recovery and Reconstruction that ‘Builds Back Better’


ISLAMABAD, October 28, 2022- A damage, loss, and needs assessment following the unprecedented floods in Pakistan calls for ‘building back better’, based on the principles of the poor first, transparency, inclusion, and climate resilience. The assessment estimates total damages to exceed USD 14.9 billion, and total economic losses to reach about USD 15.2 billion. Estimated needs for rehabilitation and reconstruction in a resilient way are at least USD 16.3 billion, not including much needed new investments beyond the affected assets, to support Pakistan’s adaptation to climate change and overall resilience of the country to future climate shocks.

Housing; Agriculture and Livestock; and Transport and Communications sectors suffered the most significant damage, at USD 5.6 billion, USD 3.7 billion, and USD 3.3 billion, respectively. Sindh is the worst affected province with close to 70 percent of total damages and losses, followed by Balochistan, Khyber Pakhtunkhwa, and Punjab.

The Ministry of Planning, Development and Special Initiatives led the Post-Disaster Needs Assessment (PDNA), which was conducted jointly with the Asian Development Bank (ADB), the European Union (EU), the United Nations agencies with technical facilitation by the United Nations Development Programme (UNDP), and the World Bank. The PDNA, in addition to estimating damages, economic losses and recovery and reconstruction needs, also assesses broader macro-economic and human impacts and recommends principles along which to develop a comprehensive recovery and reconstruction framework.

The floods affected 33 million people and more than 1730 lost their lives. They are particularly impacting the poorest and most vulnerable districts. The situation is still evolving, with flood waters stagnant in many areas, causing water-borne and vector-borne diseases to spread, and more than 8 million displaced people now facing a health crisis. The crisis thus risks having profound and lasting impacts on lives and livelihoods. Loss of household incomes, assets, rising food prices, and disease outbreaks are impacting the most vulnerable groups. Women have suffered notable losses of their livelihoods, particularly those associated with agriculture and livestock.

The PDNA Human Impact Assessment highlights that the national poverty rate may increase by 3.7 to 4.0 percentage points, potentially pushing between 8.4 and 9.1 million more people below the poverty line.

Multidimensional poverty can potentially increase by 5.9 percentage points, implying that an additional 1.9 million households are at risk of being pushed into non-monetary poverty.

Compounding the existing economic difficulties facing the country, the 2022 floods are expected to have a significant adverse impact on output, which will vary substantially by region and sector. Loss in gross domestic product (GDP) as a direct impact of the floods is projected to be around 2.2 percent of FY22 GDP. The agriculture sector is projected to contract the most, at 0.9 percent of GDP. The damage and losses in agriculture will have spillover effects on the industry, external trade and services sectors.

The Government is providing immediate relief to the impacted communities and supporting the early recovery, while aiming to ensure macroeconomic stability and fiscal sustainability. Moving forward, as recovery and reconstruction spending rises, the loss in output could be mitigated. Yet, significant international support will be needed to complement Pakistan’s own commitment to increase domestic revenue mobilization and save scarce public resources, and to reduce the risk of exacerbating macroeconomic imbalances.

Although the early loss and damage estimates may increase as the situation is continuously evolving on the ground, the PDNA lays the groundwork for an agenda for recovery and reconstruction that is designed to build back a better future for the most affected people in Pakistan. While the recovery will require massive efforts for the rehabilitation and reconstruction of damaged infrastructure, buildings and livelihoods, it will also be an opportunity to strengthen institutions and governance structures.

The report puts forth recommendations for developing a comprehensive recovery framework. While the primary focus will be on the affected areas, such framework presents an opportunity to embed systemic resilience to natural hazards and climate change in Pakistan’s overall development planning. This tragic disaster can be a turning point, where climate resilience and adaptation, increased domestic revenue mobilization and better public spending, and public policies and investments better targeted to the most vulnerable populations; all figure at the core of policy making going forward.

In the short term, targeted mechanisms such as social assistance and emergency cash transfers, provision of emergency health services, and programs to restore shelter and restart local economic activities, particularly in agriculture, should be prioritized. Reconstruction and rehabilitation should rest on key principles of: participatory, transparent, inclusive, and green recovery for long-term resilience—“building back better”; pro-poor, pro-vulnerable, and gender sensitive, targeting the most affected; strong coordination of government tiers and implementation by the lowest appropriate level; synergies between humanitarian effort and recovery; and a sustainable financing plan.

Given Pakistan’s limited fiscal resources, significant international support and private investment will be essential for a comprehensive and resilient recovery. The Pakistani authorities are committed to accelerate reforms to generate additional domestic fiscal resources and improve efficiency and targeting of public spending. Beyond the immediate needs of floods reconstruction, these reforms, while protecting the most vulnerable, will be important to generate fiscal space to invest more broadly into more climate-resilient infrastructure and adaptation to climate change, as well as to build buffers to face future shocks, while addressing macroeconomic imbalances. This commitment of the Government will also be key to mobilize further international support as well as to unlock private sector sources of financing—both of which will be absolutely critical to face the current climate change-induced shock.

The ADB, the EU, the UNDP and the World Bank are fully committed to working with the Government and people of Pakistan during the ensuing recovery phase, and to increase the country’s climate resilience.

 

[RiazHaq]

Banks and countries pledge over $9bn to rebuild Pakistan after catastrophic floods

Banks and countries pledge over $9bn to rebuild Pakistan after catastrophic floods

International funders join Pakistan PM and UN secretary general in Geneva to agree recovery plan following ‘monsoon on steroids’

www.theguardian.com

International funders join Pakistan PM and UN secretary general in Geneva to agree recovery plan following ‘monsoon on steroids’

The international community has promised more than $9bn (£7.4bn) to help Pakistan rebuild after last summer’s catastrophic floods, described by UN secretary general António Guterres as a “monsoon on steroids.”

The pledges were made on Monday at the International Conference on Climate Resilient Pakistan in Geneva, Switzerland, hosted by Pakistan’s prime minister Muhammad Shehbaz Sharif and Guterres.

Sharif has said Pakistan needs a minimum of $16.3bn over the next three years to begin recovery and reconstruction, half of which will be met by domestic resources.

The largest commitment on Monday – $4.2bn – came from the Islamic Development Bank Group. World Bank vice-president for South Asia, Martin Raiser, announced a $2bn contribution. Other contributors included the Asian Infrastructure Investment Bank, Saudi Arabia, the EU, Japan and China.


Heavy rains which started in June last year and continued until August caused Pakistan’s worst ever flooding, submerging one-third of the country. More than 4 million acres of agricultural land were inundated, resulting in a food crisis and huge financial losses.

The disaster affected at least 33 million people, killing more than 17,000 and leaving 8 million homeless.

Women and children were particularly badly affected. According to Unicef, up to 4 million children are still living near contaminated and stagnant flood waters. The number of children suffering from severe acute malnutrition in flood-affected areas nearly doubled between July and December 2022, compared with the same period in 2021, the charity reported on Monday. It also said that the number of acute respiratory infections among children has soared in flood-stricken areas.

On Monday, Médecins Sans Frontières (MSF) warned that it was seeing alarming health issues in flood-hit areas, with malaria positivity rates running at 50% in Sindh and eastern Balochistan in December, despite the colder season, when malaria infections would be expected to decline.

“We are still in an emergency phase,” said Edward Taylor, MSF’s emergency coordinator in northern Sindh and eastern Balochistan.

Speaking at Monday’s conference, Sharif said the world was standing at a “turning point of history”, adding: “It’s not only a question of how to survive … it’s how to maintain our dignity and honour – by moving forward with a sense of purpose and a sense of achievement.”

Guterres called for help to rebuild Pakistan, declaring: “No country deserves to endure what happened to Pakistan.”

He told the conference that Pakistan is doubly victimised by climate chaos and a morally bankrupt global financial system. “Above all, we need to be honest about the brutal injustice of loss and damage suffered by developing countries because of climate change. If there is any doubt about loss and damage – go to Pakistan.”

Pakistan was hit by the floods at a time while already experiencing an economic crisis, and continues to face financial challenges, resulting in record-level inflation.

Sharif said his government has prepared a comprehensive “4RF” framework, to strive for “recovery, rehabilitation, reconstruction and resilience”. “I want to make this statement categorically. Every penny will be used in a transparent fashion. I have put in place a third-party validation mechanism that every penny is accounted for and invested in the interests of needy people who have been badly affected by these ferocious floods,” he said.

 

[RiazHaq]

Michael Kugelman
@MichaelKugelman
A major feat for Pakistan, in an era of economic strain and donor fatigue, to secure $10B in pledges for flood relief.
But it’ll take time to get these pledges finalized and delivered. With 25M in desperate need of food & health aid, the govt can’t afford to rest on its laurels.

https://twitter.com/x/status/1612883732230475778

 

[RiazHaq]

Saudi Arabia is considering providing up to $11 billion to #Pakistan, a potential lifeline to a country facing default. #Qatar and #UAE are likely to join #SaudiArabia for up to $22 billion package of #loans and #investments for the country.

Saudi Arabia Signals It Could Provide Pakistan an $11 Billion Lifeline

The new assistance could strengthen Pakistan’s hand in negotiating a restart to a bailout from the International Monetary Fund as the country faces default.

www.wsj.com

ISLAMABAD, Pakistan—Saudi Arabia said Tuesday that it was considering providing up to $11 billion to Pakistan, a potential lifeline to a country facing default.

The United Arab Emirates and Qatar in recent months have said they might also offer help to Pakistan, with potential loans and investments from Gulf nations now totaling at least $22 billion after the latest announcement from Riyadh. Gulf countries have said they could extend a similar level of support to Egypt, which is also struggling economically.

The support from Saudi Arabia could strengthen Pakistan’s hand in negotiating a restart to a stalled bailout from the International Monetary Fund. Islamabad has so far been unwilling to agree to the IMF’s terms for a deal, which include raising electricity and gasoline prices and increasing taxes.

The country’s foreign-currency reserves are fast running out, with financial markets hoping that the IMF program can be put back on track within days.


Pakistan has only around $4.5 billion in official foreign-currency reserves, financial analysts estimate. In January and February this year it is due to repay debt of $6.4 billion, according to figures from the central bank. By December, it must repay a further $12.8 billion, according to the central bank.

Saudi Arabia said Tuesday that it would study increasing its investment plans for Pakistan to $10 billion from $1 billion and would also study raising its loan deposit with Pakistan’s central bank to $5 billion from the current $3 billion, “confirming the Kingdom’s position supportive to the economy of the Islamic Republic of Pakistan and its sisterly people.”

The news followed a visit by Pakistan’s new army chief, Gen. Asim Munir, to Saudi Arabia, where he met Crown Prince Mohammad bin Salman. In the meeting, “they reviewed bilateral relations and the ways of enhancing them,” Riyadh said Monday.

Pakistan is a close partner to Saudi Arabia, including providing soldiers for guarding sites and training Saudi troops. Millions of Pakistanis work in Saudi Arabia.

Pakistan has also drawn in recent months on its other close allies, in the Gulf and China, as it struggles to repay loans taken out over the last decade.

Pakistani Prime Minister Shehbaz Sharif will visit the U.A.E. later this week, and Islamabad hopes his hosts will roll over a $2 billion loan due to mature shortly and provide additional financing. The U.A.E. pledged last year to invest around $2 billion in Pakistan. Qatar has said it would invest $3 billion in Pakistan.

None of the Gulf nations’ investment plans, mostly likely to involve the purchase of state-owned enterprises, have so far materialized. Saudi Arabia has also floated the idea of building a large oil refinery in Pakistan.

China has provided a $4 billion loan deposit with Pakistan’s central bank. Around a third of Pakistan’s debt is held by Beijing. In recent years, Beijing has carried out a multibillion-dollar infrastructure-building program in the country, a showcase for its global Belt and Road Initiative, which seeks to spread Chinese influence through large construction projects.

There are few ready investment opportunities in Pakistan for Gulf nations, while its cash needs are immediate, said Samiullah Tariq, head of research at Pakistan Kuwait Investment Company, a local financing group. Despite the Saudi announcement, Pakistan still needs the IMF, he said.

“There is a liquidity crunch,” said Mr. Tariq. “We need the money right away.”