COP 27 and CMA 4 established new funding arrangements and a fund for assisting developing countries that are particularly vulnerable to the adverse effects of climate change, in responding to loss and damage. The fund includes a focus on addressing loss and damage.

A transitional committee on the operationalization of the new funding arrangements and fund was established, to make recommendations for consideration and adoption by COP 28 and CMA 5 (Decisions 2/CP.27 and 2/CMA.4).

COP 27 and CMA 4 agreed that the recommendations of the Transitional Committee were to consider, inter alia:

      (a) Establishing institutional arrangements, modalities, structure, governance and terms of reference for the fund;

      (b) Defining the elements of the new funding arrangements;

      (c) Identifying and expanding sources of funding;

      (d) Ensuring coordination and complementarity with existing funding arrangements.

COP 27 and CMA 4 also decided that the Transitional Committee was to be informed by, inter alia:

      (a) The current landscape of institutions, including global, regional and national, that are funding activities related to addressing loss and damage, and ways in which coherence, coordination and synergies among them can be enhanced;

      (b) The gaps within that current landscape, including the types of gap, such as relating to speed, eligibility, adequacy and access to finance, noting that these may vary depending on the challenge, such as climate-related emergencies, sea level rise, displacement, relocation, migration, insufficient climate information and data, or the need for climate-resilient reconstruction and recovery;

      (c) The priority gaps for which solutions should be explored;

      (d) The most effective ways in which to address the gaps, especially for the most vulnerable populations and the ecosystems on which they depend;

      (e) Potential sources of funding, recognizing the need for support from a wide variety of sources, including innovative sources.

The work of the Transitional Committee and its recommendations took into account the landscape of institutions and solutions relevant to responding to loss and damage associated with climate change impacts,  in line with the vision that the new funding arrangements should complement and include sources, funds, processes and initiatives under and outside the Convention and the Paris Agreement.

The Transitional Committee concluded its work at its fifth meeting. Its report, including its recommendations, are available here.