At COP28, countries reached a historic agreement on the operationalization of a fund to address loss and damage associated with the adverse effects of climate change. As part of that decision, the World Bank was invited to “operationalize the Fund as a World Bank hosted financial intermediary fund (FIF) for an interim period of four years”. The role of the World Bank will be to host the Fund secretariat, and to provide trustee services for the Fund.
The purpose of the Fund is to assist particularly vulnerable developing countries in responding to economic and non-economic loss and damage associated with the adverse effects of climate change, including extreme weather events and slow onset events. As a new channel for multilateral finance, the Fund seeks to provide new, additional, predictable, and adequate financial resources to developing countries that are particularly vulnerable to the adverse effects of climate change and assist in mobilizing external finance to address loss and damage, while supporting achievement of sustainable development and the eradication of poverty.
Following approval by its Board of Executive Directors, the World Bank confirmed to the COP28 Presidency in June 2024 that it is willing and able to meet the stipulated conditions. In August 2024, it submitted the relevant FIF documentation, which was approved by the Fund's Board in September.