The European Union on Friday proposed to set up a special fund to compensate for loss and damage caused by natural calamities in the most vulnerable countries, reported Reuters.

The proposal was made on the last day of the United Nations Conference of Parties, or COP27, in Egypt. The European Union climate policy chief Frans Timmermans told the COP27 summit that the 27-nation bloc will not be financing the loss and damage fund alone and would seek a broad donor base.

This means that high-emitting emerging economies like China or India might also be asked to contribute, rather than receive the fund financed only by rich nations that have contributed the most to global warming.

The loss and damage fund was prominently discussed during this year’s summit. More than 130 developing countries have demanded a new fund to help them cope with the irreparable damage of floods, drought and other climate impacts, reported Reuters.

Last week during the COP27 conference, the prime minister of Antigua and Barbuda Gaston Browne had said that highly polluting emerging economies, such as China and India, should contribute to a climate compensation fund to help other countries rebuild infrastructure after climate change-driven disasters.

Besides proposing to set up the loss and damage fund for the poor and vulnerable countries on Friday, the European Union also pushed for steeper cuts on greenhouse gas emissions by all countries, reported The Guardian.

“The issues of compensation and pollution-cutting are two sides of the same coin as far as the European Union is concerned,” Timmermans said, reported the Associated Press.

The proposed deal is being considered by the member countries. However, the United States and China have not come out in full support of the deal.

China insisted that COP27 should focus on fulfilling the 2015 Paris Agreement.

Developed countries should fulfil their obligation to provide finance to developing countries, and all countries should translate their climate targets into concrete actions, Chinese foreign ministry spokesperson Mao Ning told Reuters.