Climate finance: Deploy the Loss and Damage Fund with care

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Subscribe to enjoy similar stories. The urgency of climate adaptation has never been more apparent. The recently released Adaptation Gap Report 2024 highlights progress in fulfilling the Glasgow Climate Pact yet underscores glaring inequities.

Vulnerable populations, primarily in developing countries, bear a disproportionate burden through financial mechanisms largely reliant on loans rather than grants. The report calls for developed nations to close this financial gap and support technological and capacity-building initiatives for climate resilience. Against this backdrop, CoP-29, underway in Baku, is pivotal.

Following the establishment of the Loss and Damage (L&D) Fund at CoP-28, global attention has turned toward the operationalisation of the fund. Created to aid vulnerable countries facing the devastating impacts of climate change, the L&D Fund is essential for mitigating damages and aiding recovery. According to the 2022 report of the Intergovernmental Panel on Climate Change (IPCC), “Loss and damage finance needs are closely connected to our ability to mitigate and adapt to climate change." This fund is a vital lifeline with an initial allocation of $300 billion for developing nations.

However, the challenge lies in its timely and equitable deployment, necessitating immediate international cooperation and robust domestic frameworks. A heavy burden on the Global South: The toll of climate-induced disasters disproportionately affects developing nations, with higher fatalities and economic losses compared to the developed world. For these nations, post-disaster recovery strains already fragile economies, emphasising the necessity of the L&D Fund.