The EU has left US President Joe Biden blindsided in a last-minute deal backed by Australia. The Brussels bloc’s executive made a proposal on funding for loss and damage and mitigation at the UN climate summit in Sharm El-Sheikh on Thursday. Global climate talks approached crunch time on Friday, the final scheduled day of negotiations that are expected to go past their deadline as chances of a deal still looked unclear.The EU’s proposal could help buoy chances of an agreement and it would tie compensation for climate disasters to tougher emissions cuts, two of the thorniest issues at the meeting.EU climate chief Frans Timmermans said Friday that the bloc’s proposal on funding for loss and damage and mitigation is “a final offer” that seeks to “find a compromise” between nations as negotiators seek a way forward at the United Nations climate talks in Egypt.In climate negotiations, loss and damage refers to the idea that rich nations, which have historically done the most to contribute to climate change, should compensate developing countries most impacted. Mitigation refers to efforts to slow global warming, like drastically reducing emissions of greenhouse gases.Mr Timmermans said he was “encouraged” by immediate reaction to the proposal and more engagement was expected.He said: “This is about not having a failure here.“We we cannot afford to have a failure. Now, if our steps forward are not reciprocated, then obviously there will be a failure. But I hope, I hope, we can avoid that.”The proposal from the 27-nation EU offers a two-pronged approach that would create a pot of money for poor countries and push for steeper cuts of heat-trapping emissions by all countries, as well as the phasing down of all fossil fuels, including natural gas and oil.READ MORE: Russian anchor erupts at prospect of mass nationalisationAustralia was the first country to approve the bloc’s idea, leaving US President Joe Biden isolated.Loss and damage has become a flashpoint at the COP27 climate talks that started two weeks ago. Poorer countries bearing the brunt of climate change, from rising sea levels to extreme flooding, have been stepping up the urgency, accusing richer polluters that have contributed the most to Earth-warming greenhouse gas emissions of stalling. They insist that they cannot wait another year for the creation of a fund to pay compensation.German Foreign Minister Annalena Baerbock said Friday morning that the EU’s proposal late Thursday on a fund for vulnerable countries suffering the impacts of climate change was “a big step” in UN climate talks in Egypt.DON’T MISS:The 33 survivors of horrendous suicide cult Jonestown Massacre [VIDEO]At least 21 dead after devastating fire at refugee camp [ANALYSIS]Jeremy Hunt hits back at BBC’s Stayt after claims Tories ‘bottled it’ [REACTION]The talks, set to end today but likely to go into the weekend, were buoyed by the EU offer that tied loss and damage funding for nations vulnerable to climate change with cuts to planet-warming gases.Asked whether China will participate in such a loss and damage fund, Ms Baerbock replied: “We are arguing massively for it.”But she did not think an agreement would could quickly.“I packed my suitcase for the whole weekend,” she told German television.