Loss and Damage fund allocates $20 million to Nepal for flood recovery

The United Nations' Fund for Responding to Loss and Damage has approved $20 million to help Nepal recover from devastating climate-driven flooding that occurred in August.

During an extraordinary online meeting on Thursday, the fund's board voted unanimously to set aside the money, marking the first time it has allocated funds since being established three years ago. According to Climate Home News, the board also approved $1.6 million for administrative costs and invited Nepal to submit a proposal for the money's use, which will be reviewed at a later meeting. Reuters noted that the funding follows deadly flooding events that impacted the country earlier this year.

The board's co-chair, Camila Minerva Rodriguez, called the decision "truly historic." Maheshwar Dhakal, a senior official at Nepal's climate ministry, described the move as a "powerful expression of humanity" and a recognition of the suffering of flood victims. Inside Climate News reported that while the step is a significant milestone, the amount remains far short of the total financial needs created by climate change.

Despite the unanimous vote, representatives from developed nations expressed concerns regarding the fund's future operations. Board members from Germany and Czechia stated that the decision should not set a "precedent." Japan's representative described the allocation as "truly exceptional" and emphasized that support from the fund must be provided in accordance with established rules and procedures.

The fund is expected to approve its first formal set of projects at its next board meeting scheduled for December. The current allocation is specifically designated for recovery efforts following the August floods, which Climate Home News characterized as climate-driven.

Background

The UN Fund for Responding to Loss and Damage was established three years ago to assist developing and vulnerable nations in covering the costs of destruction caused by climate change.