Loss and Damage – Creating a Fund

by Maximilian Schubert


What is the difference between financing loss and damage and adaptation?
This is the question, the Heinrich-Böll-Foundation chose to start off their event on the new paper about loss and damage.

To give us a solid basis to join the discussion and to grasp the event easily, their was a clear definition of loss and damage. Because when you come to think about loss and damage regarding climate change, you may recognize, that it is not that easy to draw a clear line between L&D and adaptation. To distinguish those options better, they gave us a solid explanation:

If one sort of a grain doesn’t grow anymore due to climate change and the farmer has to adapt to the new weather patterns with another sort of grain, it is adaptation and can be financed through the created adaptation fund, which shall weaken the impacts of climate change, especially on small stakeholders. But on the other hand, if no grain grows anymore or the farmer may even have to resettle somewhere else, this is an evidence of loss and damage.
Julie Anne Richards from Climate Justice, made it clear, that this definition is needed to find out how much financing is needed in general, what could be taken over by the adaptation fund and what would need extra funding and to examine how the finance should be delivered.

In their new paper they classified L&D with a clear definition and may have lowered the political and social tension regarding this topic, since they cleared out misunderstandings and helped to allocate funds to projects that are genuinely loss and damage.

In short, their definition helped to set clear guidelines and to clear the adaptation fund of the charge for these tragedies. On the other side, they even showed an obvious need for more financing for L&D. Some of you may say, that there are grey areas, in which you cannot define something 100% adaptation loss or damage but for these specific cases they even set a percentage-rule to overtake the costs for the different funds.

The important questions rising from this definition are:

  • Are there tasks and capacities of other funds we could use?
  • Do we need a new fun for intl. loss and damage?
  • Some of the existing guidelines of loss and damage need to be a determining factor adapted to each country to be actually valid. How can we achieve this?
  • It has taken 5 years for the green climate fund to fund the first projects, funds will take long. Is it necessary and worthwhile to create a new fund?
  • Does the governance take the input?
  • The standing committee on finance would need to develop a standardized MRV approach.
  • How can we make sure that we are not only creating fuds but to make them benefit to the ones who suffer?

Further, some key principles need to be noted:

The polluter have to pay; precaution has to be met; Appropriateness should not impose additional burdens; Predictability should be considered and gender equality needs to be maintained.

For those, who are interested in this topic, the whole session can be found here:

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