The COP27 global climate change conference in Sharm el-Sheikh, Egypt, wrapped early Sunday with an agreement to compensate developing countries for the damages they have suffered from climate change.

While developing countries have long pushed for a fund for the suffering they have endured from climate change, wealthy countries, including the U.S., had resisted the idea. 

But that changed this year, and those developing nations got a fund establishing the climate reparations they had proposed. 

UN Secretary General Antonio Guterres heralded the agreement as an “ important step towards justice.”

“I welcome the decision to establish a loss and damage fund and to operationalize it in the coming period,” Guterres said in a statement. “Clearly this will not be enough, but it is a much-needed political signal to rebuild broken trust.”

The decision establishes a fund for responding to the “loss and damage” that these countries have suffered, but some details are not yet resolved. 

To address that, a transitional committee that will be made up of 24 countries tasked with finding funding sources and establishing a structure and governance for the fund will be established.  

Nations also adopted a broader agreement, called the Sharm el-Sheikh Implementation Plan. 

That plan separately calls upon developed countries to “urgently and significantly scale up” financial and technological assistance to help developing countries adapt to the impacts of climate change. 

The concept of adaptation finance — which helps countries prepare for potential climate damage — is separate from the concept of loss and damage finance — which helps them to respond when those damages happen. 

Climate change has been linked to a myriad of issues including rising sea levels, intense storms, floods, drought and food insecurity. 

The overarching decision also calls on countries to speed up their energy transitions by “ rapidly scaling up the deployment of clean power generation and energy efficiency measures” as well as “accelerating” efforts toward phasing down unabated coal power and phasing out inefficient fossil fuel subsidies. 

Last year’s climate decision, at COP26 in Glasgow, similarly called for the coal phasedown and inefficient subsidy phaseout.