The UN climate fund has agreed to set aside US$20 million in aid for flood-hit Nepal, marking its first funding decision, though the money still requires final approval.
A woman carrying her belongings walks through Betrawati in Nuwakot district towards her village, following deadly flash floods and a mudslide, in Nepal, Sep 6, 2026. (Photo: Reuters/Adnan Abidi)
23 Oct 2026 04:59AM (Updated: 23 Oct 2026 06:51AM)
WASHINGTON: The United Nations' climate loss and damage fund moved Thursday (Oct 22) to provide US$20 million in aid sought by flood-stricken Nepal, the first time it has set aside money for any country, in a key test of the body's credibility.
In an extraordinary meeting, the fund's board agreed to earmark the modest sum for the Himalayan country, which was hit in August by tsunami-like floods triggered by a climate-induced ice and rock avalanche that killed more than 1,400 people and left over 5,000 missing.
Camila Minerva Rodriguez Tavarez, the Dominican co-chair of the board, called the outcome "truly historic" and thanked members for "allowing us to act promptly and have a response to Nepal."
Reacting to the news, Nepal's finance minister Swarnim Wagle told AFP: "The fact that they could convene this emergency meeting in response to our letter and commit US$20 million of grant money is very welcome."
The decision does not, however, mean that Nepal will immediately receive the funding, which amounts to less than 0.5 per cent of the government's US$4.78 billion estimate for reconstruction.
US$20 million is the maximum amount countries can request in a single application.
Nepal will first have to present a proposal for the board's approval, with no firm timeline for the process.
The creation of the "Fund for Responding to Loss and Damage" was hard-won at the UN climate conferences of 2022 and 2023 by developing countries, many of them among the least responsible for climate change yet most vulnerable to its impacts.
The fund grew out of calls for "climate reparations" from historically major emitters, which ultimately did not materialise.
But since it became operational, critics have faulted both meagre pledges from rich nations - US$822 million to date - and the fact no money has been disbursed so far.
Wagle said that Nepal is a test case for "how serious the world is in helping developing and fragile countries to respond to the loss and damage associated with climate change."
PRECEDENT TUSSLE
During the meeting, some developed countries stressed the Nepal decision should be seen as exceptional, not as a template for the fund's long-term future.
"This is not a precedent on one hand, but on the other it provides a learning for the development of the long-term model of the fund," the European Union's Jan Dusik said.
Developing countries hit back.
"I heard Jan saying that we are open for learning, but not in setting precedent. Please do not define the boundaries for learning," said Pakistan's Ali Tauqeer Sheikh, in comments endorsed by others.
Last year after part of Jamaica was destroyed by the worst hurricane in its history, the fund's French co-chair at the time told AFP that it was not meant to "provide a humanitarian response" but was aimed at "the next stage."
That wait-and-see approach became untenable after the disaster in Nepal. Developing countries, which hold a majority of the fund's board, demanded a response to Nepal's request.
LEGAL OBLIGATIONS
"It's a landmark first step. At the same time, it's also a proof of how far the fund still has to go," said Harjeet Singh, founding director of the Satat Sampada Climate Foundation and global convenor of the Fill the Fund campaign, which has been pressuring the fund.
The UN and its humanitarian partners launched a US$49.6 million emergency appeal after the Nepal disaster, and the United States announced US$31 million in new flood recovery support in September.
But as courts increasingly rule on states' climate obligations, developing countries and legal experts argue that such aid should be an obligation of rich countries, not voluntary.
Nikki Reisch, director of the Climate & Energy Program at the Center for International Environmental Law, said she hoped the Nepal decision "will really be a springboard" for demands that the fund and responses to escalating climate impacts be "grounded in legal obligations."
Source: AFP/fs