It is a climate finance mechanism under the UNFCCC to help vulnerable developing countries cope with unavoidable and irreversible climate impacts that cannot be addressed through mitigation or adaptation.

Development

  • 2013: Warsaw International Mechanism (WIM) on Loss and Damage established at COP19 to address loss and damage associated with climate change.
  • COP27 (2022, Sharm El‑Sheikh): Parties agreed to establish a dedicated Loss and Damage Fund.
  • COP28 (2023, Dubai): Fund’s governance, structure and initial capitalisation were finalised; the Fund became operational.

Note

  • World Bank serves as the interim trustee/host for an initial period.
  • Voluntary contributions, not mandatory assessed shares.

Loss and Damage 

  • Loss
    • Economic Losses: infrastructure, homes, crops, livelihoods, reconstruction costs.
    • Non‑economic Losses: lives, health, biodiversity, ecosystems, cultural heritage, indigenous knowledge, territory.
  • Covers
    • Extreme Events: Floods, cyclones, heatwaves, GLOFs.
    • Slow‑onset Events: Sea‑level rise, desertification, salinisation, glacier retreat.

 

Source: Down To Earth