Loss and damage: Challenges and opportunities for city leadership

The impacts of the climate crisis in the world’s cities are vast and multiplying, and already causing unprecedented loss and damage beyond scientific predictions. While the climate crisis affects urban and rural areas alike, many losses and damages are exacerbated in cities – due to population density, concentration of economic activities, and geographic location. This is particularly acute in rapidly urbanising countries in the Global South, where an estimated one billion people live in informal settlements, facing higher climate vulnerability.

Although locally led actions are rarely framed in loss and damage terms, cities are at the forefront of loss and damage responses. Despite limited mandates and resources, cities are already showing how increased support could help tackle the issue in urban areas. This report organises city actions on loss and damage across five key areas, each supported by examples from cities. 

The five areas explored in the report as listed below.

1. Preventing and preparing for climate risks, beyond the limits of adaptation, to address losses and damages before extreme climate events occur.
2. Acting as first responders, in the immediate crisis aftermath, ensuring continuity of services and providing relief to those who are most in need.
3. Generating data and evidence on economic and non-economic loss and damage, leveraging local knowledge and proximity to communities.
4. Enhancing city-to-city cooperation and showing global solidarity amid accelerating climate impacts through the sharing of expertise, knowledge and capacity on responding.
5. Influencing national and multilateral discussions through mayoral diplomacy and advocacy.

There is an urgent need for new and dedicated resources and innovative solutions to incorporate the experiences and perspectives of cities at the frontline, while addressing the systemic injustices that currently underpin the development and climate finance landscape.

The report gives ten recommendations directed to cities, as well as national governments, multilateral development banks, international funds and organisation and donors to successfully address the urban dimension of loss and damage at scale and fit for purpose in cities.

1. Consult, partner with and involve cities and mayors in multilateral processes for loss and damage funding, finance and technical assistance.
2. Create dedicated funding windows in new loss and damage funding arrangements, ensuring that these resources are additional, predictable and demand-driven.
3. Integrate critical urban loss and damage issues, notably climate displacement and health into loss and damage funding and programming.
4. Integrate city-specific loss and damage funding and finance into national budgeting, strategies and policy making.
5. Accelerate the localisation of humanitarian assistance, to increase coordination and promote direct city access to speedy disbursement of funding for immediate response.
6. Increase localised data and disaster risk analytics at the urban level, addressing both economic and non-economic losses and damages.
7. Equip cities to innovate, test and fill research gaps by working with cities.
8. Invest directly in city government to support risk reduction, prevention, preparedness and resilience in urban areas, with a focus on informal and vulnerable settlements.
9. Strengthen city-specific disaster risk finance instruments, including parametric risk transfer solutions and make them fit for purpose in cities.
10. Scale-up city-to-city cooperation for effective global solidarity on loss and damage.