Nepal needs $4.7 billion to rebuild after this year’s floods. The first money to arrive from the new U.N. Fund for Responding to Loss and Damage is $20 million, provisionally set aside at an emergency board meeting on Thursday. The floods killed more than 1,400 people, left thousands missing and wrecked homes, schools and hydropower dams, in Nepal and across the border in China.
A small cheque against a large bill
Nepal’s government says donors at home and abroad had given about $102 million by the end of September. Add the new allocation and the total still sits far below the reconstruction estimate.
“It’s a very small amount compared to what we lost,” said Maheshwar Dhakal, a senior official in the climate and environment ministry. He still saw value in the decision. “This shows that the global community can take the right decision at the right time to help those who are most vulnerable to climate change,” he said. Kathmandu is now approaching India, China and the multilateral development banks for the rest.
Aid campaigners were blunter. “Nepal needs billions to rebuild, and this Fund is responding only in millions,” said Harjeet Singh of the Fill the Fund campaign. He wants a permanent mechanism that can pay out emergency money quickly, without making disaster-hit countries wait through long approval procedures. Brandon Wu of ActionAid USA called the response a demonstration of the “utter inadequacy of support from rich countries.”
A fund still finding its feet
The loss and damage fund came out of the 2022 U.N. climate talks, after years of pressure from developing countries that add little to global emissions but absorb some of the worst damage. This payout is its first. Governments have pledged more than $820 million, yet 176 requests from developing countries, worth about $2.8 billion, are already waiting. The board meets again in December to weigh more of them.
The money is also under strain from the donor side. The OECD reported that official development assistance from major donors fell 23% in 2025, with the United States leading the cuts and Germany, Britain, France and Japan trimming too. Climate experts say the loss of USAID and other budgets has made it harder for countries like Nepal to prepare for disasters and respond to them.
The Green Climate Fund, based in Songdo, South Korea, is the largest of the U.N.-coordinated climate funds. Its portfolio stood at $13.5 billion at the end of 2023, or $51.9 billion with co-financing. It has had its own critics. Former director Héla Cheikhrouhou complained in 2016 that it backed too many “business-as-usual types of investment proposals”, and Executive Director Mafalda Duarte announced reforms in 2023 to make it more efficient.
The mountain behind the flood
A September analysis by the World Weather Attribution research group found that human-caused warming was a key factor in the collapse of the mountainside that triggered the flood. Warmer temperatures had thinned glaciers and thawed permafrost, loosening the ice and frozen ground that hold fractured rock in place.
The stakes extend beyond one valley. The Himalayas hold the largest volume of snow and ice outside the polar regions, and Prime Minister Balendra Shah told the United Nations in September that “we did not create this crisis, yet we are paying a colossal price for it.”
The next round of U.N. climate talks opens in Turkey next month, and financing for countries hit by climate disasters is expected to be a central fight.
Sources
- UN climate fund promises $20 million for Nepal flood recovery, far short of billions needed
- Green Climate Fund
- IDB Approves $128.48 Million Financing Package to Improve Water Security in Ecuador
Photo: Ginevrajocosa88 (CC0)
