Dear Board Members, 

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We write to urge your support for the adoption of an ambitious, equitable, and human rights-based Resource Mobilisation Strategy (RMS) for the

Fund for responding to Loss and Damage (FRLD).​​

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While the launch of the first call for funding requests under the start-up phase, under the Barbados Implementation Modalities (BIM), represents an essential first step towards delivering long-awaited support to countries and communities most affected by loss and damage, the financial envelope initially allocated to this phase (250 million USD in grant support), as well as the total amount of funding pledged to date, remains far below the vast and rapidly increasing needs of developing countries and affected communities.

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Analysis from the Loss and Damage Collaboration in 2024 estimated the Loss and Damage needs in developing countries to be 724.43 billion USD per year until 2030. These are only estimates that do not fully take into account non-economic loss and damage while real figures are only going to increase with time due to effects of inflation and other variables and as the climate crisis worsens. The FRLD should provide  the primary multilateral contribution to cover these needs. To do so, it must grow to at least 400 billion USD in disbursements each year, while the rest should be covered by other actors under wider loss and damage funding arrangements. 

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For the FRLD to meet the expectations of developing countries and climate-vulnerable communities which have waited for so long for its establishment, it will have to provide finance that is new and additional, timely, adequate, public, grant-based and non-debt creating, predictable, precautionary, effective, human-rights based, child-responsive, gender-transformative, disability-inclusive and poverty-reducing. This is not just our demand, these are legal obligations under international law, as confirmed by the International Court of Justice (ICJ) in its Climate Advisory Opinion. Yet by 16 March 2026, only 821.4 million USD has been pledged to the FRLD,  contribution agreements are only in place for 591.41 million USD, and of these only 444.15 million USD has been paid in. This risks leaving just 180 million USD considering the budget for Fund’s expenses in 2026

(13.5 million USD) and once the 250 million initially allocated to the BIM has been spent; and even less if more is allocated to the BIM at the eighth Board Meeting (B8). 

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This is why we are urging you to adopt an RMS that would allow the FRLD to reach in the medium to longer-term, a progressively scaled-up ambitious goal in line with the growing needs of developing countries. As we recognize that it would not be feasible to immediately reach a target of 400 billion USD per year, we are recommending an incremental approach that should ensure the following:

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• A mobilisation target of at least 50 billion USD per year at the first resource mobilization process due to take place in 2027. 

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• A commitment and a strategy to reach at least 100 billion USD per year by 2031 at the second replenishment round.

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• A commitment and a strategy to reach at least 400 billion USD per year by 2035 at the third replenishment round, as we consider the evolving needs of developing countries.

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The Resource Mobilisation Strategy must stress that the primary source of finance should be public finance from developed country parties in the form of grants, in line with the Common But Differentiated Responsibilities and Respective Capabilities (CBDR-RC) under the Convention and their obligations under Article 9.1 of the Paris Agreement and Article 4 of the United Nations Framework Convention on Climate Change and the obligations of international cooperation and assistance and remedy, as confirmed by the ICJ.

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Developed country parties claim that they do not have sufficient resources to fill the FRLD toward addressing the scale of the needs. However in addition to budgetary contributions, they can and should raise additional public funds domestically including through a Climate Damage Tax on fossil fuels extraction and production, windfall taxes or a permanent rich polluter profit tax on large fossil fuels corporations, financial transaction taxes, levies on luxury aviation, wealth taxes, redirecting fossil fuels subsidies and part of public military spending and tackling tax evasion and avoidance. In 2024, Oil Change International calculated that rich countries could raise over 5.3 trillion USD per year for climate finance, including for loss and damage, by using some of these monetary and fiscal levers.

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To achieve the substantial increase in targets at the second and third replenishment cycles,  innovative sources will have to play an important role, complementing the budgetary contributions from developed countries, particularly internationally administered levies or solidarity levies administered nationally but earmarked for the FRLD, such as a maritime shipping levy with a portion allocated to the FRLD or a premium flyer solidarity levy. All innovative sources should be fair, progressive and redistributive, predictable and publicly-controlled, follow the polluter-pays principle, be subject to the CBDR-RC principle and should not disproportionately or negatively impact developing countries and low-income groups.

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As part of the Resource Mobilisation Strategy, the Board should mandate the Secretariat to analyse the potential for resource mobilisation from different proposals and processes. In a first instance, this could focus on identifying innovative sources applied at the domestic level in developed countries and the possibility of allocating a share of those revenues to the FRLD. 

 

In order to ensure the FRLD is aligned with international law, as clarified by the ICJ AO, we are also urging you to move beyond voluntary contributions entirely and mandate the Secretariat to develop a methodology for Board adoption which sets concrete targets based on CBDR-RC and fair shares for each state and major carbon-polluting companies to reinforce their historical responsibility and corresponding obligations to provide finance for addressing loss and damage and remedy the harms caused by their actions and in-actions. 

 

To ensure the FRLD has the resources in place for steadily building on the BIM, it is essential that the RMS is adopted at the ninth Board meeting (B9) as scheduled and the first replenishment, due to be completed in 2027, is launched at the same time. We urge the Board and the Executive Director to build sufficient support for it and continue encouraging financial inputs on an ongoing basis. Additional inputs should be sought in 2026 and by COP31 to ensure the FRLD has enough resources to function.

 

Adopting an RMS that meets the expectations of the people most affected by loss and damage should be your guiding star. A fund that will only be able to support a few limited-scale requests per year is not what developing countries and climate-vulnerable communities need and fought to establish. They are owed effective remedies and only having resources that grow substantially and commensurate with the scale of needs, would put the FRLD on a trajectory to provide them.

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Yours sincerely,
 

(List of organisations) (To be updated)

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