Loss and Damage Fund
The Loss and Damage Fund is a climate finance mechanism created during the 27th Conference of Parties (COP), held in Egypt in 2022. The fund was designed to address loss and damage, to support communities when adaptation strategies are inadequate or implemented too late, and damage and risk has already happened.United Nations Environment Programme (2023). [https://www.unep.org/resources/adaptation-gap-report-2023 Adaptation Gap Report 2023: Underfinanced.Underprepared. Inadequate investment and planning on climate adaptation leaves world exposed]. Nairobi. {{doi|10.59117/20.500.11822/43796}}{{rp|63}}
Description
This was an agreement between the nations to establish a multilateral loss and damage fund to support communities in averting, minimizing, and addressing damages and risks,{{rp|63}} after three decades of negotiation on loss and damage caused by climate change. Finally, the 27th Conference of Parties (COP) adopted a proposal drafted by the Warsaw International Mechanism for Loss and Damage.{{Cite web|url=https://unfccc.int/sites/default/files/resource/cp2022_L05_adv.pdf|title=Santiago network for averting, minimizing and addressing loss and damage under the Warsaw International Mechanism for Loss and Damage associated with Climate Change Impacts}} This fund will be available to support poorer countries for the losses and damages caused by climate change. The parties agree to utilise the Santiago Network, established at COP25,United Nations, [https://unfccc.int/santiago-network/about About the Santiago Network], accessed 21 November 2022 to provide technical assistance in averting, minimizing, and addressing loss and damage.{{Cite web |last=Farand |first=Chloé |date=2022-11-20 |title=What was decided at Cop27 climate talks in Sharm el-Sheikh? |url=https://www.climatechangenews.com/2022/11/20/what-was-decided-at-cop27-climate-talks-in-sharm-el-sheikh/ |access-date=2022-11-20 |website=Climate Home News |language=en}} The fund will operate as a financial mechanism of the Paris Agreement.{{Cite web |title=Fund for responding to Loss and Damage |url=https://unfccc.int/loss-and-damage-fund-joint-interim-secretariat |access-date=2024-11-16 |website=unfccc.int}} During COP29 in Baku, it was announced that the fund was ready to receive contributions, and that it will start financing projects in 2025.{{Cite web |title=Fund for responding to Loss and Damage ready to accept contributions |url=https://cop29.az/en/media-hub/news/fund-for-responding-to-loss-and-damage-ready-to-accept-contributions |access-date=2024-11-16 |website=cop29.az}}
At previous COP events, industrialised nations blocked attempts by low and middle-income countries asking for financial support with their climate adaptation plans. At COP26 in Glasgow, Scotland became the first Global North country to pledge bilateral finance specifically for loss and damage.Bakhtaoui, I., & Shawoo, Z. (2023). How Small and Locally Led Grants Can Address Loss and Damage: Early Lessons from the Scottish Government's 2021 Funding Commitment. Contributing authors: Diallo, A. A., Barua, A., Dinshaw, A., Twongirwe, I., Nkhoma, L., Waqavonovono, M., Kourabas, M., Shahjahan, M., Bainteiti, I. R., & Soqo, S. SEI Report. Stockholm Environment Institute.
In March 2025, the administration of U.S. president Donald Trump withdrew the country's representatives from the Loss and Damage Fund.{{cite news |last1=Abnett |first1=Kate |last2=Furness |first2=Virginia |title=United States quits board of UN climate damage fund, letter shows |url=https://www.reuters.com/world/us/united-states-quits-board-un-climate-damage-fund-letter-shows-2025-03-07/ |publisher=Reuters |date=7 March 2025 |archive-url=https://archive.today/20250307140641/https://www.reuters.com/world/us/united-states-quits-board-un-climate-damage-fund-letter-shows-2025-03-07/ |archive-date=7 March 2025 |url-status=live }}