Loss and Damage Fund makes first allocation: $20 million for Nepal
Why in the news
On 22 October 2026 the board of the Fund for responding to Loss and Damage (FRLD) set aside $20 million for Nepal’s recovery from climate-driven floods in August 2026. It was the fund’s first allocation.
Key facts
- Amount: $20 million, plus $1.6 million in administrative costs. Nepal has been asked to submit a proposal on how it will use the money.
- Meeting: an extraordinary board meeting held online.
- Floods: struck the Bhotekoshi–Trishuli region on 26 August 2026. More than 60,000 people were directly affected, and recovery is estimated at $4.8 billion.
- Request: Nepal’s environment and finance ministers wrote to the fund on 31 August seeking help.
- Precedent row: Germany and Czechia said the decision should not set a precedent, and Japan called it truly exceptional.
- Finances: about $350 million is available to allocate, and there is a cap of $20 million per project.
| Item | Figure |
|---|---|
| Allocation for Nepal | $20 million |
| Administrative costs | $1.6 million |
| Estimated recovery cost | $4.8 billion |
| Funds available to allocate | About $350 million |
About the FRLD
The fund was agreed at COP27 in Sharm el-Sheikh and operationalised at COP28 in Dubai. The Philippines hosts its board, and the World Bank is its trustee. The board will meet next in the Philippines in December, where it is expected to approve its first projects.
Exam angle
- FRLD: born at COP27, operationalised at COP28.
- Board host country: Philippines. Trustee: World Bank.
- First allocation: $20 million for Nepal, in October 2026.