Natural disasters will end up costing insurers a record $35 billion this year, after hurricanes lashed the Caribbean and southeastern United States and a record ten typhoons soaked Japan, the UN's Environment Program said.

"It is, I believe, unquestioned that climate change is happening now and it is happening at an even higher speed than we expected before," program director Klaus Toepfer said.

Overall destruction costs in 2004 will surge to $95 billion worldwide compared to an average of $70 billion a year during the last decade.

The alarm bells sounded came as environment ministers from 80 countries met on Wednesday for the final days of a UN conference on climate change.

The conference of nearly 200 nations has turned into a polarized affair, with the European Union and nations supporting the Kyoto protocol to cut greenhouse gases in one camp and the United States, the world's biggest polluter, in the other.

Just two months before Kyoto goes into force thanks to Russia's recent ratification, the United States has made it very clear it will not sign up for Kyoto's mandatory caps on emissions after President George W. Bush withdrew from the agreement in 2001.

The US delegation has also said repeatedly over the last nine days that it is "premature" to negotiate anything for when Kyoto expires in 2012.

That stonewalling has earned the United States few friends at this tenth United Nations meeting, where many of the 6,000 participants wear cords around their necks saying: "No to Bush, Yes to Kyoto."

NO 'TOP DOWN' FOR US

British Prime Minister Tony Blair will be working to soften Bush on climate change during its G8 presidency next year, but analysts believe he will be unsuccessful.

Although responsible for 25 percent of the world's emissions, the United States rejects legally binding rules that could hurt economic growth.

"The (U.N) climate change convention cannot make countries accept approaches that are not consistent with their national circumstances," US head delegate Paula Dobriansky told delegates, adding that she disagreed with its emphasis on "top-down" mandates.

The US position got a boost from Italy in Buenos Aires as it called for an end to the binding agreements of the Kyoto protocol after 2012 in favor of voluntary targets that would entice the United States, China and India.

Kyoto, which will reduce emissions by five percent in industrialized nations, is only a first step and excludes developing countries like China and India, who are already among the top five polluters.

The European Union, the world leader in the fight to cut heat-trapping gases, tried to quell notions of dissent in its ranks.

"What the Italian minister said is quite right. We have to involve the fast-growing developing countries and the United States in the after-2012 regime," said Dutch Environment Minister Pieter van Geel, heading the EU delegation.

EU commissioner for the environment, Stavros Dimas, refused to comment on Italy's suggestion that countries should not be forced to cut down emissions. But he told Reuters that "targets are very important especially for industrialized countries because they can be used to measure results. So in the future we should consider them."

Environmental activists, meanwhile, are exasperated by the lack of urgency at the conference, which they blame on excessive deference to an unwilling United States.

"We could be leaving this city without any achievement," said Gurmit Singh of the Climate Action Network in Southeast Asia.

One of the conference's main goals is to approve an aid package for developing countries to adapt to climate change. But a powerful Saudi Arabia delegation led by Oil Minister Ali al-Naimi is seen blocking that effort.

"For them, it's a principle to block the negotiations because they are involved with US oil and other fossil fuel industries which have no interest in Kyoto," said Stephan Singer of WWF.