Eamon Ryan: Ireland should help foot the ‘loss and damage’ bill from its €16bn corporation tax take

CLIMATE and Environment Minister Eamon Ryan wants the corporation to take tax from multinational companies headquartered in Ireland to help pay for the harm caused to poor countries by climate change.

r Ryan was speaking on his way back from the COP27 climate summit in Egypt where a historic decision was made to establish a ‘loss and damage’ fund for the world’s most vulnerable nations.

No money was pledged to the fund and the details of how it will operate are to be worked out by an international committee to be formed over the next few months.

But Mr. Ryan said Ireland would be a contributor.

“We make so much of our money by being the global center for many companies,” he said.

“That €16bn corporation tax we get in a year, that’s because we’re the EMEA (Europe, Middle East and Africa) headquarters to so many companies.

“Are we going to say, ‘O h yes, we’re going to take all the corporate profits thank you very much indeed, from our role as EMEA center’ and we’re not going to be a leading contributor in funds like this?

“That would not be fair, it would not be sustainable and it would not be defensible.

“I think Simon Coveney gets this and Michael Martin gets this. We increased our overseas aid budget this year by 17pc. It wasn’t meant, so I’m confident we’ll do our bit.”

Ireland played a key role in getting the deal over the line with Mr. Ryan appointed lead negotiator for the European Union on the loss and damage issue.

It was a pivot by the EU on the contentious issue that finally broke the deadlock between the wealthiest and largest economies and the smallest and poorest.

It brought to an end 30 years of failure to progress the matter, which has been raised repeatedly since the first summit in 1992.

But it took talks that carried on through Friday and Saturday night to finally bring the summit to a close at 7am yesterday.

Mr. Ryan said the past week had been quite emotional.

“It’s been a dramatic week, the highs and lows, when you think everything is going to fall apart and then you get progress.

“There’s such a cast of characters involved in these talks but for all the nonsense and all the ridiculous late nights and macho negotiating stuff, it is a historic development, the loss and damage facility.

“That’s not to read too much into it – there’s nothing delivered, it’s just a political commitment, but it’s a political commitment within a legal structure which is quite strong.”

The EU was initially opposed to setting up a dedicated loss and damage fund, preferring to use existing funds to pay out loss and damage assistance and seeking to defer the issue for further discussion.

Most of the G20, the world’s biggest economies, were cool on the very idea of ​​loss and damage funding – which some studies have suggested could cost at least a trillion euros a year – although the US was more sympathetic than others.

But the G77, the 134 countries the UN categorizes as developing nations, were adamant there would be no COP agreement without a fund.

“The EU wasn’t against financing loss and damage but there is a history of funds being slow and bureaucratic so I think the EU’s initial negotiating position was correct,” Mr. Ryan said.

“But I also think it was correct to put that aside because the countries we were negotiating with needed the commitment.

“Why would we get all high and mighty and say we know better than you? Sometimes you listen and move to the other person’s position.

“That was a key moment and it was a lesson that a bit of humility and listening goes a long way.”

The change of tack caught the US by surprise. Mr Ryan said it was “unfortunate” the US team did not get more warning but the 27 EU member states present reached a greement themselves only 10 minutes before an open plenary of all 197 countries was scheduled.

The US coming on board helped galvanize support, although opposition has been signaled by the Republican Party, which increased its power in the US government during mid-term elections last week.

Mr. Ryan was clear about the amount of work that has to be done to make the fund functional.

The EU secured wording that the fund would prioritize the most vulnerable countries, because some of the countries categorized as developing under international law 30 years ago include the likes of China and India, which have since become industrialized and massive carbon emitters.

The wording also seeks a broad base of funding, reforms of multinational development banks, debt relief and “innovative” funding.

The latter refers to proposals made by Ireland, and backed by the EU, that fossil fuel companies and global shipping and aviation be levied to help pay for climate damage.

On financial reform, Mr. Ryan said: “That’s all in prospect rather than guaranteed because this transition committee and the International Monetary Fund, the Asian Development Bank, African Development Bank, World Bank and so on – they have to step up to the plate. “

While loss and damage was considered the litmus test of the summit’s success, progress on the other core issues was poor.

On climate mitigation, which means reducing emissions, hopes of a commitment by countries to increase national targets were dashed.

On eliminating fossil fuels, there was no strengthening of a pledge from COP26 to “phase down” coal rather than “phase out” all fossil fuels.

“We were disappointed on mitigation. It doesn’t go far enough, there wasn’t sufficiently ambitious text in the agreement,” Mr. Ryan said.

“What I hope is that you can unlock this sense of there being an injustice, that the poor countries that weren’t responsible for the emissions were feeling the brunt of climate change.

“At least with the loss and damage fund we have an answer to that question and we can say we have a fund, now let’s talk seriously about mitigation.”

Mr. Ryan paid tribute to the team of officials from the Department of Foreign Affairs (DFA) and Department of Environment (DECC) who were closely involved in the negotiations.

In particular, he said the deal would not have been closed without the input of climate envoy Sinéad Walsh, deputy director of the DFA’s climate unit, Jen Hobbs; DECC legal adviser Martin Collins and DECC assistant principal Emer Griffin.

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