Nepal floods test speed of UN climate loss and damage fund

Evidence continues to mount that rising global temperatures played a significant role in the catastrophic flooding in Nepal last month. The disaster, triggered by a glacier collapse on August 26, resulted in more than 1,400 deaths and left approximately 6,000 people missing as entire villages were erased. A rapid scientific review published last week determined that exceptionally high temperatures during July and August destabilized an already geologically fragile area.

Nepal intends to cite this study in its application for funding from the United Nations Fund for Responding to Loss and Damage, a specialized mechanism designed to assist nations affected by extreme weather linked to anthropogenic climate change. Kathmandu has requested US$20 million, the maximum allowable grant, to support immediate recovery efforts and build resilience against future climate events.

However, Nepal is not alone in its struggle for assistance. It joins a queue of 119 other countries awaiting a decision from the fund, which began accepting applications at the end of 2025. During its July meeting, the fund’s board reviewed only four applications, and no rulings have been issued since. With the next scheduled meeting not occurring until December, critics argue that such prolonged delays contradict the fund’s core mission of delivering swift financial relief after climate disasters.

Donors, primarily wealthy nations, are being urged to streamline the evaluation and disbursement processes. While pledges exceeded $800 million as of March, the total value of applications submitted so far reaches $2.8 billion, vastly outstripping the current $250 million available pot. The loss and damage fund was established in 2022, championed by the late Bangladeshi climate scientist Saleemul Huq, as part of a decades-long campaign by low-income countries for climate justice. Based on the “polluter pays” principle, it aims to ensure that rich nations, responsible for the majority of historical emissions, fund poorer countries to cope with the consequences.

The fund distinguishes itself from larger mechanisms like the Green Climate Fund, based in South Korea, which focuses on emission reductions and resilient infrastructure through grants and loans. The Green Climate Fund has an average approval timeline of two years, with some projects taking three to five years. In contrast, the UN loss and damage fund was created to provide immediate grants for emergency response, targeting some of the world’s poorest nations in Africa and Asia where monthly household incomes can be as low as $100 to $400.

In many affected regions, governments lack the liquidity to respond rapidly to extreme weather, making it difficult to fund essential actions such as debris clearance, shelter provision, clean water distribution, and the restoration of schooling. The need for rapid grants is not unprecedented; the UN’s Central Emergency Response Fund, for example, is currently reviewing a separate $2.5 million application from Nepal.

Economist Richard Jolly, co-director of a UN history project, previously noted in 2023 that while the UN excels at incubating innovative ideas, it often struggles to learn from its own operational experiences. Jolly suggested that the current bottleneck—where processing a grant for a nation with wiped-out villages takes six months—demonstrates a failure to adapt. Nepal and other applicants are seeking efficient distribution of already-allocated funds to provide timely relief, rather than requesting unsustainable sums.