More than 100 climate experts and advocates convened for the second workshop on addressing loss and damage (L&D) on 15-16 July in Bangkok, Thailand. This was the latest in a series of meetings towards the establishment of funding arrangements focused on this workstream, as agreed to in the last year’s climate talks in Egypt.

The workshop was conducted by the Transitional Committee (TC), who are tasked to formulate recommendations that would be considered and adopted at the upcoming negotiations (COP28/CMA6) in Dubai. With the remaining TC meetings to occur behind closed doors, this was the final opportunity for many stakeholders to provide direct inputs into this process.

The previous meetings have seen Parties and non-Party representatives discuss numerous options for the L&D funding facility (Fund) and the accompanying funding arrangements. These were carried into the Bangkok workshop, as it focused on specific aspects of this issue: the governance arrangements of said fund, and enhancing complementarity, coherence, and coordination in its operationalization.

On governance arrangements

Delegates mostly agreed that the Fund should be a new operating entity within the UNFCCC, pointing to how L&D is an issue fundamentally distinct from adaptation and mitigation. They also stressed that it must be held accountable to COP/CMA, abiding by core principles such as common but differentiated responsibilities and respective capabilities and equity. 

However, some participants suggested that an existing institution should host the Fund. They raised concerns about the speed of setting up and operationalizing it, citing the urgency of alleviating harmful impacts to the most vulnerable countries and communities.

Differing views also emerged on the governance arrangements of the Fund. Many suggested for a Board with a small composition relative to those of existing institutions like the Green Climate Fund (GCF) to enable a quicker response. Others put forward a more “hands-on” Secretariat to enable a more efficient operationalization. 

The role of the Santiago Network in the L&D funding arrangement landscape was also emphasized, with suggested tasks including assisting in the coordination for convening stakeholders during key meetings and dialogues, and providing technical assistance when determining the eligibility of who would access the Fund.

Categories for specific allocations within the Fund were also discussed. Options including by country (to prioritize Small-Island Developing States and the Least Developed Countries), by hazard (sudden onset events vs. slow onset events), and by contributor (i.e., how much an MDB may contribute) were presented to the TC.

In the midst of these disagreements, a more inclusive Fund received wide support to emphasize the different approach needed to address L&D. Mechanisms such as the special windows for easier access by indigenous peoples and the inclusion of non-State actors in this Board gained traction as well. 

L&D funding being new, additional, predictable, flexible, and sufficient, while largely championed by developing country representatives, received virtually no opposition during the workshop. 

Meanwhile, the subject of nature of contributions to the Fund was debated. Many agreed that developing countries can make voluntary contributions, non-State actors such as MDBs and philanthropic organizations providing supplementary funding, and developed countries being obligated to provide funding. 

Some representatives from developed nations, however, pushed back on their role, citing Article 4 of the UNFCCC that only obligates them to support adaptation and mitigation actions. As a response, some delegates pointed out that the failure of developed countries to properly implement said section is what has led to the need for the Fund to begin with.

On complementarity, coherence, and coordination

While there were differing perspectives on the structure and governance of the Fund, proposals on enhancing complementarity, coherence, and coordination related to its operationalization were relatively less contentious.

Delegates agreed that the response against L&D at the global scale has to be complementary to actions at the national and local levels. This would require the strengthening of country-driven approaches to multiple aspects of L&D-related work, such as proper data collection and management, conducting climate risk assessments, and capacity-building for strengthening implementation against climate hazards. 

The diversity of possible sources of funding against L&D also opens up more opportunities to enhance complementarity, coherence, and coordination. Emphasizing co-benefits on adaptation, mitigation, and achieving the UN Sustainable Development Goals of proposed actions can aid in mobilizing more funding.

With this comes several strategies on establishing relationships with potential funding sources. For example, a suggestion for a more hands-on Secretariat could help manage engagements with the MDBs, partnerships with other donors from the private sector, and communications with other L&D-oriented entities under the UNFCCC such as the Santiago Network.

In relation to this, a clear distinction was made by delegates about the scope of the Fund when compared to similar mechanisms focused on adaptation and humanitarian actions. These fields have been linked with L&D together in previous years, which opens the possibility of coordinating in terms of exchanging best practices and sourcing funds that may provide co-benefits in addressing the other fields. 

However, participants highlighted that responses against L&D to be supported by the Fund follow a different scope than humanitarian and adaptation activities, as it occurs beyond the limits of the capacity of communities and ecosystems to adapt to or mitigate climate change. 

Unresolved issues

Nonetheless, there remains key issues that were not emphasized as much during the workshop. Perhaps the most notable is on the scope of activities covered by the Fund; while delegates suggested activities such as restoring livelihoods, restoring basic social services such as health, and rebuilding infrastructures and systems impacted by slow onset events, there was not as much agreement on what exactly the options or the language to be used would be on this matter.

Yet the COP/CMA decision text that would be produced in Dubai must state, at the bare minimum, the scope, functions, structure, funding sources, and accountability and transparency mechanisms of the Fund. It must also clearly mention that the provision of L&D funding must not affect the allocation of finance for adaptation and mitigation.

While there was slightly more clarity into the likely recommendations of the TC from the outputs of this workshop, many of the discussions held in Bangkok are reminiscent of previous dialogues not just for L&D, but also in other workstreams of climate action.

Furthermore, until the decision is made at COP28, the fate of the L&D funding facility and, more importantly, the future of billions of vulnerable peoples remain unclear. We must remain vigilant and active in engaging with policymakers to ensure that no one will be left behind.

John Leo is the Deputy Executive Director for Programs and Campaigns of Living Laudato Si’ Philippines, a member of Aksyon Klima Pilipinas, and the Youth Advisory Group for Environmental and Climate Justice under the UNDP in Asia and the Pacific. He is a climate and environment journalist since 2016.