Deep Dive: What are loss and damage payments

Dear friends, We live in a time of difficult choices. Time and again, we are faced with a dilemma: should we do what is morally right, or what makes economic sense? Such decisions are never easy. Our politicians—and, by extension, our entire country—grapple with choices of this kind every single day. How fortunate, then, that today’s topic is one where we do not have to make such a difficult trade-off. Helping countries in the Global South protect themselves against the climate crisis and rebuild following disasters is not only the morally right thing to do—it is also economically sound! This is precisely what is currently being negotiated at the global climate conference in Antalya¹⁰: who should pay when the climate crisis destroys what people have worked to build? At the end of August, a flood devastated entire valleys in Nepal. In October, the UN’s fund for loss and damage earmarked money for a country for the very first time—just under 18 million euros.⁷ That does not even cover one percent of the damage.²⁰ And even this funding has yet to arrive, three years after the fund was established.⁹ Let us begin with the straightforward part: why it is morally right to take responsibility for our "climate debt." Since 1850, Germany has emitted approximately 88 billion tonnes of CO₂—ranking sixth globally.⁶ An individual in Nepal emits as much CO₂ in an entire year as a person in Germany does in just under four weeks.¹⁹,²³ Yet, nations like Nepal, Malawi, and Tuvalu are the first and hardest hit by the consequences. In July 2025, the International Court of Justice clarified that climate action is not merely a voluntary gesture of goodwill, but an obligation under international law. Those who violate this duty may be held liable for making reparations.¹³,¹⁴ Now, some might argue: "But other countries are currently developing their industries and paying little attention to the climate!" I have two answers to this. First: the money from this fund does not go to industrial powers, but rather to the countries that emit the least and stand to lose the most.⁷ Second: for whom are goods being produced in factories around the world? Our mobile phones, our clothing, our steel, our supply chains—a portion of the emissions we blame others for is actually embedded in the very things we buy ourselves.¹,¹⁵ And to all those calling for "Germany first": this money actually helps us, too. Between 2000 and 2021, climate change has already cost Germany at least 145 billion euros.³ The flood in the Ahr Valley alone accounted for over 40 billion.³,¹⁶ According to a study commissioned by the German federal government, these costs could reach as much as 900 billion by 2050.³ But we are not an island. Our economy relies on supply chains that span the globe—for raw materials, intermediate goods, and food. The German Environment Agency states that the risks posed by the consequences of climate change abroad are at least as significant for the German economy as those within our own borders.²¹ When ports, fields, and factories elsewhere end up underwater, we feel the impact here—in the form of higher prices and lost jobs. And what is the federal government doing? It is making cuts. For 2025, Germany has allocated only 4.7 billion euros from its budget for international climate finance—falling short of the at least six billion euros that had been pledged.⁵ Yet, in 2023 in Dubai, Germany was a frontrunner, helping to launch the fund with a contribution of 100 million dollars.² In total, around 720 million euros have been pledged to the fund... for the entire world.¹¹ That is less than two percent of the cost of the flood in the Ahr Valley alone.³ Of this amount, only a little over half has actually been paid in.²² Estimates suggest that the annual need is in the hundreds of billions of euros.⁴ Therefore, we demand: First: The German federal government must honor its promise of six billion euros in annual climate finance—and must not make any further cuts in the 2027 budget.⁵,¹² Second: Germany must put new funding for the fund on the table in Antalya. Third: Those who make billions from coal, oil, and gas must contribute their share. And one final point: The least costly damage is the damage that never occurs in the first place. Every euro we invest in prevention yields a return of two to ten times that amount.⁸ An investment of around 700 million euros in early-warning systems would prevent damages ranging from nearly three to approximately 14 billion euros each year.⁸,²⁴ This is why the Paris Agreement speaks not only of "paying for damages," but of avoiding and reducing damages—and only then, compensating for them.²⁵ Skimping on prevention today means paying many times more tomorrow. However, for the people in Nepal, any preventive measures come too late. That is why we need both. Friends, I mentioned at the beginning that we often have to choose between morality and economics. In this case, we do not. Every euro we invest today in protection, prevention, and reconstruction in the Global South is a matter of justice. And it will protect us from much higher costs tomorrow. Solidarity is not a luxury; it is the most affordable insurance we have. The climate crisis knows no borders. Our solidarity must not know any either.