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NOVEMBER 2017
Toward
Implementation
The 2017
AdaptationWatch Report
Ada
W
2
ADAPTATIONWATCH.ORG
AdaptationWatch partners
Adaptify (Netherlands)
Both ENDS (Netherlands)
Brown University’s Climate
and Development Lab (USA)
ENDA Tiers Monde (Senegal)
Grupo de Financiamiento Climático
para América Latina y el Caribe (Mexico)
International Centre for Climate Change
and Development (Bangladesh)
Institute for Social and Environmental
Tra nsit ion ( Nepa l & U SA)
Nur University (Bolivia)
Oxford Climate Policy (UK)
Pan African Climate Justice Alliance (Kenya)
Stockholm Environment Institute (Sweden)
Tra nspa rency Int erna tion al (G erma ny)
Université Libre de Bruxelles, Centre d’Etudes
du Développement durable (Belgium)
University of Colorado-Boulder’s Environmental
Studies Program (USA)
About AdaptationWatch
AdaptationWatch is a growing partnership of
organizations from across the world, aiming to
catalyze wide participation in plans and actions
to adapt to climate change. AdaptationWatch
partners combine cutting edge tools on tracking
development nance with world class research,
advocacy and capacity building.
This is the third in a series of AdaptationWatch
Reports, prepared in advance of the annual
UN Climate Conference, without support from
any funding agency. AdaptationWatch seeks to
share information and work collaboratively with
all organisations engaged in transparency and
account-ability, and climate change adaptation,
and we welcome collaboration and partnership
in dealing with the issues raised in this report.
Editorial and production
Editors:
Kevin M. Adams and Daniell e Falzon
Acknowledgements:
In addition to the individual authors who
participated in the writing of this report,
AdaptationWatch would like to acknowledge,
in alphabetical order, Saleemul Huq,
Richard J. T. Klein, Ian Lefond, Frishta Qaderi,
Ian Tellam, J. Timmons Roberts, Romain
Weikmans, and the rest of the AdaptationWatch
network for their helpful contributions.
Design:
Rebecca Leffell Koren
www.rebeccaleffellkoren.com
Photography:
CGIAR Research Program on
Climate Change Agriculture and Food Security
(CCAFS) and Charlotte Hugman.
AdaptationWatch partners
Adaptify (Netherlands)
Both ENDS (Netherlands)
Brown University’s Climate
and Development Lab (USA)
ENDA Tiers Monde (Senegal)
Grupo de Financiamiento Climático
para América Latina y el Caribe (Mexico)
International Centre for Climate Change
and Development (Bangladesh)
Institute for Social and Environmental
Tra nsi ti on (Ne pa l & US A)
Nur University (Bolivia)
Oxford Climate Policy (UK)
Pan African Climate Justice Alliance (Kenya)
Stockholm Environment Institute (Sweden)
Tra nsp ar enc y I nte rn ati ona l (Ge rma ny)
Université Libre de Bruxelles, Centre d’Etudes
du Développement durable (Belgium)
University of Colorado-Boulder’s Environmental
Studies Program (USA)
Publication and outreach support provided
by the Stockholm Environment Institute.
Funded and supported by the Institute at Brown
for Environment and Society and its Climate and
Development Lab
Cite as:
AdaptationWatch (2017). Toward Implementation:
The 2017 AdaptationWatch Report. Eds.
Kevin Adams and Danielle Falzon. White Paper.
Available online at: www.adaptationwatch.or g
The 2017
AdaptationWatch Report
Toward
Implementation
Adaptation
Watch
Lead authors
Introduction
Kevin M. Adams, Stockholm Environment Institute, Sweden
Danielle Falzon, Brown University, United States
Chapter 2
Ken MacClune, Institute for Social and Environmental
Tr a ns i t i o n ( I S E T ), In t e r n a ti o n a l , U n it e d S ta t e s
Chapter 3
Naznin Nasir, International Centre for Climate Change
and Development (ICCCAD), Bangladesh
M. Feisal Rahman– Independent University, Bangladesh
Saleemul Huq, International Institute for Environment and
Development (IIED), United Kingdom
Sam Ogallah, Pan African Climate Justice Alliance (PACJA), Kenya
Chapter 4
Jav ie r Gonza le s- Iwan ci w and Fa bl an a Me nd ez -Raya ,
Nur University, Bolivia
Chapter 5
Sandra Guzmán, Alin Moncada, Nella Canales, Mariana Castillo, and
Tania Guillén, Climate Finance Group for Latin America and the
Caribbean (GFLAC)
Chapter 6
Romain Weikmans, Free University of Brussels, Belgium
Chapter 7
Mizan Khan, North South University, Bangladesh
Conclusion
Danielle Falzon, Brown University, United States
Kevin M. Adams, Stockholm Environment Institute, Sweden
Executive Summary 5
Chapter 1
Introduction: e Dawning Era of Adaptation Implementation 7
SEI, Brow n Uni versi ty
Chapter 2
Adaptation Finance from the Ground: Insights from Southeast Asia 12
ISET
Introduction 13
Climate change and adaptation in Southeast Asia 14
Climate nance streams 15
Challenges 16
Recommendations 19
Conclusions 21
Chapter 3
Financing Adaptation in the Least Developed Countries 22
ICCCAD, IIED, PACJA
Least Developed Country Access to the Green Climate Fund 23
Adaptation Funding as Opposed to Mitigation Funding 24
Direct Access to Funds—A Far Cry for Least Developed Countries (LDCs) 25
Adaptation Funding as Opposed to Mitigation Funding 26
Can Least Developed Countries Count on the Green Climate Fund? 27
Chapter 4
Adaptation Funding and Governance in Latin America
and the Caribbean 28
Nur University
Adaptation Governance Trends in Latin America and the Caribbean 31
Climate Investment Funds (CIF) Pilot Program for
Climate Resilience (PPCR) Investments and Mainstreaming Adaptation 33
Green Climate Fund (GCF) Readiness in Latin America
and the Caribbean 33
Climate Finance Coordination 35
Monitoring and Evaluation Frameworks, Participation, and Transparency 36
Conclusions 37
Chapter 5
Toward Climate Finance Reporting Systems in Latin America 38
GFLAC
Tracking Climate Finance in Latin America and the Caribbean
Using International Reporting 39
Reporting Climate Finance from Latin American Countries’ Perspectives 44
Recommendations for Climate Finance Reporting Systems in
Latin America and the Caribbean 48
Chapter 6
Transparency from the Other Side:
A Review of the First Biennial Update Reports 50
Free University of Brussels
Introduction 51
Non-Annex I Parties’ Compliance Toward UNFCCC
Tr a ns p a r e nc y G u id e l i n es 51
Reporting Approaches Used by Non-Annex I Parties for Climate
Finance Received 52
Conclusion: Main Challenges and Opportunities Ahead 56
Chapter 7
Capacity Building for Climate Change Adaptation:
Lessons from Other International Regimes 57
North South University
Regime Experiences: Commonalities and Differences 59
Lessons for Building Capacity to Adapt to Climate Change 61
Conclusion 62
SEI, Brow n Uni versi ty
List of tables and figures
Fig. 1.1 Fou r ge ner atio ns of adap tat ion
research and policy
Fig. 2.1 Governance of global public-sector
climate nance
Fig. 3.1 Green Climate Fund (GCF) approved
projects and allocated funding
Fig. 3.2 Approved projects and allocated
funds by access modality
Table 4.1 Data gathering in selected Latin
American and Caribbean countries
Table 4.2 Adaptation governance in
selected Latin American
and Caribbean countries
Table 4.3 Green Climate Fund (GCF)
readiness in selected Latin American
and Caribbean countries
Table 5.1 Climate nance reporting for Latin
America and the Caribbean
Table 5.2 Characteristics of public nance for
Latin America and the Caribbean
Table 5.3 International climate nance ows
in eight Latin American countries
(in million USD)
Table 5.4 National public expenditure related
to climate change in Latin America
(seven countries)
Table 6.1
Non-Annex I Parties’ compliance
with climate nance transparency
requirements
Table 6.2 Reporting approaches used by some
non-Annex I Parties for nancial
support received
5
Executive Summary
After decades of deliberation, the Paris Agreement has thrust climate policy
into a new era of adaptation implementation. Developing countries in particular
are in need of global support for adaptation; climate nance, capacity building,
and improved governance are critical to this support’s effectiveness. This report
highlights the experiences of nations in the Global South in adaptation. We
emphasize the need to bolster the effectiveness of climate adaptation action in
order to ensure that the world’s most vulnerable people are well-equipped to
respond to the impacts of climate change.
The report begins with an analysis of the changes in approaches to
adaptation since the inception of the United Nations Framework Convention
on Climate Change (UNFCCC). The analysis examines the latest generation
of adaptation plans, in which the global community turns from conceptualizing
and deliberating adaptation to action.
Chapter 2 introduces climate nance, a primary challenge in adaptation.
There is a signicant gap between funding for adaptation and funding for
mitigation. Furthermore, the lack of transparency in global nance ows makes
it difcult to track funding for adaptation. This chapter focuses on ten years of
adaptation and resilience work in Southeast Asia in order to better understand
the challenges and opportunities for climate nance.
Chapter 3 outlines key challenges for least developed countries (LDCs)
in accessing climate nance, particularly from the Green Climate Fund. The
complicated application process, along with the lack of clarity in the denition
of adaptation as opposed to development, and an insufcient number of
implementing agencies are barriers to acquiring adaptation nance.
The fourth chapter acknowledges the unique position of Latin American
and Caribbean countries (LACs). LACs are among the countries most vulnerable
to climate change. They have successfully made use of nance readiness programs
through the Green Climate Fund. This chapter argues that, building on existing
efforts, Parties to the UNFCCC should continue to assess vulnerable groups,
communities, and ecosystems by seeking synergies between traditional and local
knowledge in order to formulate reliable socioeconomic and environmental
policies.
Chapter 5 examines monitoring, reporting, and verication practices in Latin
America and the Caribbean. While developed countries have historically borne
much of the onus for tracking adaptation nance, there is growing interest among
recipient nations in improving their own systems. Beginning with an overview of
climate nance ows to the region, this work discusses steps that Latin American
and Caribbean countries are taking to improve climate nance tracking, and the
importance of developing international guidelines.
Chapter 6 deals with accountability in climate adaptation. It is currently
impossible to calculate the support received by developing countries because their
Biennial Update Reports (BURs) lack comprehensive information. There is an
urgent need for common methodologies, clear reporting guidelines, and building
capacity for reporting to enhance transparency, promote accountability, and ensure
that the support developing countries need fully aligns with the support they receive.
6
The seventh chapter emphasizes the importance of building capacity for the
long term in developing countries. Drawing on other international development
regimes, we identify common themes and best practices that can be applied to
capacity building for climate change. These include participatory planning
between and across developed and developing countries, ownership of capacity
building efforts by recipient countries, and a focus on education, training, and
building awareness.
Finally, we recommend ten actions for moving forward on adaptation
under the Paris Agreement:
1. Commit to the era of adaptation implementation.
2. Increase nance for adaptation.
3. Dene ‘adaptation’ in a way that is clear and widely accepted.
4. Outline a robust reporting system with common accounting methodologies.
5. Move toward substantive assessments of progress on adaptation.
6. Ensure that nance goes to the most vulnerable and under-supported.
7. Consider in-country issues with communication and coordination.
8. Simplify and support efforts to increase climate nance readiness.
9. Co-design adaptation action with local communities.
10. Reorient capacity building efforts to focus on the long term.
7
Kevin M. Adams
Stockholm Environment Institute, Sweden
Danielle Falzon
Brown University, United States
Introduction: The Dawning Era
of Adaptation Implementation
Chapter 1
8
Introduction
Shortly after the adoption of the Paris Agreement in December 2015, George
Monbiot, in an opinion piece for The Guardian, wrote: “By comparison to what
it could have been, it’s a miracle. By comparison to what it should have been,
it’s a disaster.”1 The United Nations Framework Convention on Climate Change
(UNFCCC) has an embattled history, from the contentious and ultimately
unsuccessful Kyoto Protocol, to the collapse of the Copenhagen negotiations
in 2009. Coalitions of Parties have continued to evolve and fracture along new
dividing lines, and widespread agreement has often seemed out of reach.
Reaching global consensus and adopting the Paris Agreement is undeniably
a landmark achievement for the climate policy community. The Agreement aspires
to “[hold] the increase in global average temperature to well below 2°C above
pre-industrial levels”2, while also “[establishing] the Global Goal on Adaptation of
enhancing adaptive capacity, strengthening resilience and reducing vulnerability
to climate change.”3
Yet, for all the praise that the Paris Agreement deserves, an equal measure
of skepticism is needed; the ability to achieve these goals is an entirely different
matter to agreeing on them. Based on pledges to reduce emissions currently
submitted by Parties to the Paris Agreement, global mean temperatures are set
to surpass the 2°C target and lead to roughly 2.8°C of warming (Climate Action
Tr a ck e r n .d . ) 4. This is a signicant difference and, if left unchecked, could have
devastating effects for small island developing states (SIDS), least developed
countries (LDCs), and other vulnerable Parties.
The Paris Agreement also established the “global goal on adaptation” in an
attempt to place adaptation and reducing emissions on an equal footing. However,
there is great uncertainty about how the global goal will be operationalized.
Measuring progress toward such a goal would likely pose signicant challenges;
for example, developing countries where vulnerability to climate impacts is high
and resources and capacity are often sharply limited, would need to take action
on adaptation urgently. To this end, the Agreement outlines three main ways
to support developing nations implement adaptation: provide nance; develop
and transfer technology; and build capacity, discussed in Articles 9, 10, and 11
respectively. Additionally, Article 13 provides an overarching transparency
framework, and Article 14 a global stocktake of implementation efforts and
progress toward the Agreement’s goals.
The means of implementation, which are of great importance to adaptation
efforts, are quickly becoming a focus of international climate negotiations.
Adaptation efforts under the UNFCCC process are beginning to pivot from
“what needs to be done” to “how we are going to accomplish it”. Put differently,
adaptation policy and research have begun to enter a new era, dened by
increasing attention to implementation.
1 Monbiot 2015
2 UNFCCC 2015 Decision 1/
CP.15, Article 2, Paragraph
1(a)
3 UNFCCC 2015 Decision
1/CP.15, Article 7, Para-
graph 1
4 Climate Action Tracker
9
5 Klein et al. 2017
6 Smith and Lazo 2001
7 Burton et al. 2002
8 Schipper 2006
9 Burton 1996
10 McCarty et al. 2001
e Evolution of Adaptation—
Four Generations of Research and Policy
In order to consider what a new era of adaptation focused on implementation
entails, it is instructive to consider the history of climate change adaptation
research and policy. A recent working paper, published following the Adaptation
Futures 2016 conference, outlines four distinct generations of climate adaptation
research and concomitant policy concerns.5 Accor ding to this working pape r,
each new generation of adaptation research and policy builds upon the previous
generation, encompassing new sets of issues and questions (Figure 1.1).
Figure 1.1
Four generations of adaptation research and policy
Early, or ‘rst generation’ adaptation research, beginning in roughly 1992,
focused primarily on descriptive questions. Little was known about exactly what
effects climate change might have on communities and, because of this, work
focused on getting a better understanding of how climate change would affect
the lives of people around the world.6 This research was closely linked to the
impact assessment community, and began to raise questions about when climate
impacts might become unavoidable, and how those impacts might be addressed.7
From a policy perspective, adaptation was not yet recognized as a key concern
in UNFCCC texts. The concept itself was somewhat unclear
8 and there were
concerns that focusing on adaptation might detract from mitigation efforts.9
The second generation of adaptation research and policy began in 2001
with the publication of the Intergovernmental Panel on Climate Change (IPCC)
Third Assessment Report (AR3), which informed the Marrakech Accords at the
7th Conference of Parties (COP7). AR3 contained a specic chapter on adaptation
that addressed key questions such as “What is adaptation?”, “Who is adapting?”,
and “Adapting to what?”10 The chap ter c onsidered clima te ad aptat ion a s a disti nct
area of inquiry, and began to develop an adaptation vocabulary that dened key
terms such as vulnerability, sensitivity, exposure, and adaptive capacity. In this
sense, the second generation of adaptation research and policy represented a turn
inward; the climate community began to take the signicance of adaptation to a
warming world seriously.
Following these developments, a third generation of adaptation research
and policy began around 2007 as the international community prepared to sign
a post-Kyoto global climate agreement. The IPCC Fourth Assessment Report
FIRST GENERATION (1992–)
SECOND GENERATION (2001–)
THIRD GENERATION (2007–)
Descriptive Questions
What are the risks posed
by climate change? Normative Questions
What is adaptation?
Policy Questions
What policy options
can support adaptation?
FOURTH GENERATION (2015–)
Implementation Questions
How does successful
adaptation happen?
10
(AR4), together with with the Bali Action Plan, represented a turn toward
adaptation policy, thinking about how policies could support climate change
adaptation, how adaptation priorities could be set, and the kinds of political
structures and institutions that would be necessary for successful adaptation. In
this generation, questions about mainstreaming climate change into other areas
of policy abounded; important connections were made between disparate sectors
of government relevant to climate adaptation. Importantly, the failure of Parties
to reach a global agreement in Copenhagen in 2009 underscored the need for
robust scholarship and debate on these policy-oriented topics; it became crucial to
develop adaptation policies that were both effective and politically feasible.
Finally, with the Paris Agreement in 2015, adaptation research and policy
has turned decidedly toward implementation, building on the key areas of work
in previous generations. Implementing adaptation policy is likely to pose new
challenges, ranging from how to measure the effectiveness of adaptation to how
to work productively with communities and stakeholders around the world. The
descriptive, normative, and policy questions that dened previous generations are
still relevant today but, in the emerging fourth generation, are being seen from a
new perspective. Descriptively, work must be done to understand how adaptation
works on the ground, as well as to understand which adaptation activities may be
successfully replicated and taken to scale. Normatively, debates are ongoing about
the relationship between adaptation and development; it is necessary to consider
what role adaptation should play in challenging underlying social, economic, and
political structures in order to drive potentially transformative change. From a
policy perspective, a great deal of institutional development must be done in order
to support mainstream or stand-alone climate adaptation work, both at national
and international levels.
As the international climate policy community moves from debating the
details of the Paris Agreement toward implementing it, a new approach to climate
change adaptation research and policy is bound to emerge. Building on decades of
work, the dawning era of adaptation implementation is likely to mean asking new
questions and addressing old challenges in new ways.
Watching Adaptation in the Era of Implementation
Successfully implementing adaptation and achieving the Global Goal on
Adaptation established under the Paris Agreement will require strong governance
and unprecedented levels of coordination, both within and among developed and
developing countries. For developing countries, where most adaptation efforts will
take place, this will mean accessing support for implementation from international
partners, governing and prioritizing adaptation efforts within their borders, and
building capacity for the long term.
The goal of this report is to shed light on the experiences of developing
countries in addressing these issues. The chapters share knowledge and expertise
across borders in order to build an understanding of common challenges and ways
they might be overcome.
11
Chapter 2 addresses ways of accessing support for implementation. It describes the
landscape of climate nance in Southeast Asia and draws attention to key issues in
the region. Chapter 3 focuses on support available to highly vulnerable countries,
with insights from LDCs. Chapter 4 explores the governance of adaptation nance
in Latin America, including a specic look at readiness programs offered by the
Green Climate Fund.
Chapter 5 turns to capacity building, discussing the experience of Latin
America in order to further conversations about developing monitoring and
evaluation systems for climate adaptation nance. Chapter 6 approaches building
capacity for reporting from a different perspective. Developing countries’ Biennial
Update Reports raise questions about adaptation nance received by developing
countries and the structures available in UNFCCC to guide the climate nance
reporting process. Lastly, Chapter 7 takes a look at building long-term capacity
for adapting to climate change, drawing on the experiences of other international
governance regimes.
In all, the perspectives from around the world show how adaptation is being
implemented in the Global South right now, how adaptation is being governed,
and how adaptation could be governed. Countries are learning to make use of
their resources, and to share knowledge and strategies for effectively obtaining
and utilizing funds for effective projects. The insights show how access to nance,
capacity building, and accountability are crucial for successful adaptation,
especially in the era of adaptation implementation. However, there are many
challenges in ensuring that the most vulnerable nations have the tools to adapt to
climate change. The ndings of this report may serve as a guide for all stakeholders
interested in implementing adaptation going forward.
Toward Climate Finance Reporting
Systems in Latin America
Sandra Guzmán, Alin Moncada, Nella Canales,
Mariana Castillo, and Tania Guillén–Grupo de
Financiamiento Climático LAC, Mexico
Chapter 5
Ken Ma cClun e
Institute for Social and Environmental
Tra ns it ion-I nt er nati on al , U nited S ta tes
Adaptation Finance from
the Ground: Insights from
Southeast Asia
Chapter 2
13
11 Terpstra and Ofstedahl
2013
12 Thwaites et al. 2015
Introduction
At the time of its inception in 1992, it was widely considered that the UNFCCC
would fulll its mission within ten to fteen years of the completion of its rst
scientic report, led by the Intergovernmental Panel on Climate Change (IPCC).
It was anticipated that, within that time, suggestions for limiting and reducing
greenhouse gas emissions would have been implemented. Now, 25 years after Rio,
the atmosphere contains an additional 50 parts per million of carbon dioxide. Five
further IPCC reports indicate that there has been some progress, but not as much
as expected in 1992, nor enough to address rising greenhouse gas emissions.
In retrospect, one can see the challenges that dealing with climate change
would face. Addressing climate change has been met with many forms of resistance,
from entrenched, powerful interests to a century of dirty energy infrastructure,
and from cultural and social norms to mindsets on natural resources and the
Earth’s capacity. Today we know that the challenges of mitigating carbon dioxide
emissions are more complex than we originally expected, and we have accepted
that it will take more effort than we planned. For this reason, the UNFCCC
incorporated adapting to the impacts of climate change in its agenda.
The task of adaptation and nancing adaptation is another new challenge.
Adaptation is quite different from mitigation because of the scale at which it
needs to be addressed, and because the ways and means by which international
institutions can best help are different. Climate adaptation efforts will need to
engage bottom-up processes. Though there is certainly the need for global and
regional engagement on adaptation through policies and incentives, most publicly
nanced climate adaptation will need to happen at provincial and municipal levels.
Further, most adaptation is likely to be done autonomously by communities and
households as people adjust to changes in their environment. Thus, international
support and nancing for these localized efforts is crucial.
This chapter is based on nearly ten years of climate adaptation and resilience
practice in Southeast Asia with the Rockefeller Foundation-supported Asian
Cities Climate Change Resilience Network (ACCCRN) and the United States
Agency for International Development (USAID)-supported Mekong-Building
Climate Resilient Asian Cities (M-BRACE) program. These two programs, along
with smaller efforts supported by other donors, led to action on climate adaptation
and resilience in 20 cities across seven countries between 2008 and 2017. This
chapter does not promise to be a deep investigation into all aspects of climate
adaptation nance, nor can it, since the denition of a climate adaptation action
is still being debated.11 At the same time, global climate nance institutions are
undergoing rapid change.12 What this chapter does present is a snapshot of the
challenges and opportunities for adaptation nance as seen from the ground. This
chapter is based on on-the-ground experiences and interactions, and interviews
with practitioners in the eld. Nonetheless, the opinions expressed and any errors
are the author’s alone.
14
13 World Bank 2017
14 Coates et al. 2003
15 Baran 2006
16 Grantham & Rudd 2017
17 World Bank 2013
18 World Bank 2013
19 Ammann et al. 2014
Climate Change and Adaptation in Southeast Asia
Southeast Asia, here dened as 11 nations – Thailand, Laos, Cambodia, Vietnam,
Myanmar, Malaysia, Philippines, Indonesia, Brunei, Singapore, and Timor
Leste – is home to 639 million people. All these nations, except Timor Leste, are
members of the Association of South East Asian Nations (ASEAN). ASEAN
had a combined gross domestic product (GDP) of USD 2.55 trillion in 2016
(ASEAN 2017), making the ostensibly common market ASEAN Economic
Community (ACE) the seventh largest unied economic entity globally. Many
of the ASEAN nations have had tremendous economic success over the last 30
years and, along with this success, there has been development, changes in land
use, and urbanization. The region has some of the world’s most populated cities.
The Jakarta metropolitan region (30.5 million) in Indonesia and the Manila
metropolitan region (24.1 million) in the Philippines are the world’s second and
fourth most populous in the world and constitute 37% and 17% of their nation’s
total GDP respectively. With investments in infrastructure and education, and the
opening of international markets, the region has seen a tremendous reduction in
poverty over the past few decades. Extreme poverty (dened as USD 1.90 per day)
in East Asia and the Pacic dropped from 29.1% of the population in 2002 to 7.2%
of the population by 2012.13 Yet that 7.2% constitutes 166 million people still living
in extreme poverty, with millions more living just above subsistence levels.
Despite its expanding middle class and associated rapid urbanization,
Southeast Asia has one of the world’s largest populations dependent on ecosystem
services for their livelihoods. For example, in much of Southeast Asia, livelihoods
depend on freshwater sheries, such as those found in the Mekong River. The
Mekong is one of the most diverse freshwater sheries in the world with over
1,200 different species.14 The sh a re highly depe ndent on s easonal ows.15 Of
the 55 million people living in the Lower Mekong Basin in 2003, approximately
40 million were connected either directly or indirectly with Mekong sheries.16
Climate change, along with the construction of dams and other development,
is putting the livelihoods of those 40 million at risk.
The Southeast Asia region’s hot, wet climate provides a vast array of
ecosystem products such as lumber, rubber, palm oil, and coconut, as well as
supporting traditional agriculture like rice farming, and fruit growing. The coasts
and islands of the region sustain a strong aquaculture industry. These ecosystem-
based industries involve both industrial-scale actors and millions of subsistence
farmers. In addition to agriculture and aquaculture, the region’s environmental
beauty and climate draw tourists (63 million in 2015) providing employment in
a high-value sector.
One of the expected impacts of climate change in Southeast Asia is the
degradation and loss of coral reefs.17 This would diminish tourism, reduce sh
stocks, and leave coastal communities and cities more vulnerable to storms.
Further, because the countries of Southeast Asia have relatively high coastal
population densities18 they are particularly vulnerable to rises in sea level,
increases in heat extremes, more intense tropical cyclones, and ocean warming and
acidication. Heat extremes, particularly high heat indices (heat and humidity),
could also affect both rural populations19 and industrial production in Southeast
15
20 Opitz-Stapleton 2016
21 Lenton et al. 2008
22 NEDA 2013
23 Venkateswaran and Mac-
Clune 2016
24 Note: at present, there is no
consensus among climate
scientists about the ability
of climate models to proper-
ly project typhoon frequency
and intensity under climate
change, IPCC 2013
25 Buchner et al. 2015 Box 1
Impact of climate change on Filipino coconut farmers
On 8 November 2013 Typhoon Yolanda (internationally known as Typhoon
Haiyan) struck the island of Leyte in the Philippines near the city of Tacloban.
About 600,000 hectares of agricultural land were affected, and crop losses
were estimated at 1.1 million (metric) tonnes, of which 80% was in Leyte’s
administrative region, Region VIII. The main crops in the most badly affected
areas of Regions VI, VII, and VIII were: coconut (73% of the crop area), palay
(16% of the crop area); and corn (4% of the crop area). The most signicant
damage was to coconut (valued at PHP 17,825 million). Damage was recorded
over a wide area: 441,517 hectares, of which 161,400 hectares was totally
destroyed.22
The Philippines is the world’s largest producer of coconut, the bulk of which
is grown on medium-sized farms. The islands of Eastern Visayas are culturally
important for coconut production and remain one of the major producers in the
country. The impact of Typhoon Yolanda on many of the Eastern Visayas islands
was devastating, completely destroying many plantations. The current cultivar of
coconut requires 10 years to grow from seed to fruit bearing. Thus, the impact of
the storm left some coconut farmers without a livelihood.
Interviews with district disaster ofcials in 2015
23 showed that six months
after the storm, as immediate demands for disaster response began to subside,
the Region VIII Regional Disaster Coordinating Council (RDCC) met to assess
longer-term impacts. Discussions considered information about climate change,
which indicated that storms such as the one just experienced could become more
frequent, perhaps with return periods of less than 10 years.24 Upon learning that
intense storms might have a 10-year frequency, the coconut farmers became
very concerned and asked if there were cultivars that could either withstand
such storms or which could mature more quickly and thus be more easily
replaced after storms. Unfortunately, their concerns have not yet been answered.
Meanwhile, they face an uncertain future.
Asia.20 For example, the crops of coconut farmers in the Philippines were destroyed
by Typhoon Haiyan (see Box 1). Further, the dependence of hundreds of millions
of Southeast Asians on monsoon-driven weather patterns is cause for concern;
the Asian monsoons have been identied as one of the globe’s major climate
tipping points.21 Thus, there is a vital need to adapt to climate change and to build
resilience in the region.
Climate Finance Streams
According to the latest analysis of global climate nance ows by the Climate
Policy Initiative
25 the world’s climate nance streams consist of USD 391 billion,
of which 6% (USD 25 billion) was for adaptation. Most climate nance (92% or
USD 361 billion) was for mitigation, of which USD 292 billion (81% of mitigation
16
26 Terpstra and Ofstedahl
2013
nance, 75% of total climate nance) was for renewable energy. The report makes
clear that nance for adaptation is an area where further work is needed. Part of
the challenge in tracking adaptation nance is the scale at which most adaptation
action is taken, as will be discussed in more detail later in this chapter. Furthermore,
the amount of adaptation nance destined for Southeast Asia is unclear.
Challenges
In the context of local climate adaptation and resilience practices,
the key challenges have been:
i) Dening climate adaptation and framing solutions.
ii) Governance in making decisions about nancing.
iii) Fractured streams of nance.
iv) Few ways of accessing nance and ways of accessing nance
that are remote from the issue on the ground.
v) A focus on top-down, bankable projects.
Defining Climate Adaptation
Dening the added cost of climate change adaptation beyond the costs of ‘normal
development’ is a challenge. The challenge is effectively described by Terpstra
and Ofstedahl
26 in a hypothetical case of installing drainage pipes. In their
example, an assessment of the impacts of climate change led to installation of a
larger pipe than would have been installed had the assessment not been made.
They ask the questions: Are the extra costs of the larger pipe the added cost of
climate adaptation? Would the study that showed the need for the larger pipe be
an adaptation practice? If there were no pipes, would the entire drainage system
be considered adaptation? This hypothetical case shows that installing a pipe
that did not exist before could be considered as normal development or could be
considered as adaptation. Moreover, as the authors pointed out, this example is
relatively straightforward. Dening the added cost of adapting to climate change
becomes more difcult when trying to assess how much of the funding owing
to non-infrastructure programs, such as social vulnerability assessments, can be
considered as adaptation nance.
Scales of Climate Adaptation Finance Governance
A key challenge for the climate policy community in general, and the climate
nance community in particular, is the difference between the scale of governance
and the scale of action. The author’s experience with an international non-
governmental organization (NGO) operating out of the global North shows the
importance of entering development contexts with an open mindset. Despite
the well-documented value of local knowledge in ensuring sustainability of
interventions, international representatives can still, far too easily and often
unintentionally, inuence people away from locally valued and contextually
relevant action.
17
Top-down and bottom-up perspectives can be very different. High-level national
and international purviews are large scale and usually cover long periods. At more
local levels, for example at the municipal level, people and activities generally
focus on issues that are close in space and time. A key challenge for climate
adaptation to date has been the disconnect between the timescale of climate
change, usually decades, and timescales of local interest, usually ‘now’ with some
consideration for the next two to four years. There is a need to bridge the gap
between needs for adaptation in the long term with current demands without
being too prescriptive.
Climate adaptation nance has emerged from the same structures
(UNFCCC processes and the Rio Convention) that shaped climate mitigation
nance. The nature of climate science – modelling relatively long-term, global-scale
impacts and monitoring carbon emissions – lends itself to top-down processes.
Climate models are better at predicting global averages than they are at predicting
regional values. Similarly, mitigation, although ultimately addressed by reducing
emissions point source by point source, is measured by the amount of carbon in
the atmosphere on a global scale, although regional and national emissions can be
coaxed out of such global measurements to some extent.27 A clear challenge then
is for climate adaptation nance to be relevant at the local scale, that is to address
the impacts of climate change in pro-adaptive ways that will meet local needs as
people adjust to the effects of climate change. In this context, adaptation is largely
a local issue. The challenge for the climate community is to bridge the divide
between global and local governance of nance for adaptation.
Fractured Finance Streams
A challenge at national and local levels is that nance streams for dealing with
climate change are fractured. There are many different pools that cover various
aspects (see Figure 2.1). The Global Environmental Facility (GEF), the Adaptation
Fund (AF), and the Green Climate Fund (GCF) each have different funding
sources and different areas of purview for providing nance. Likewise, the Climate
Investment Fund (CIF), which operates independently of the UNFCCC, has
different sub-funds for specic areas of climate nance, such as technology
transfer and resilience. The wide range of focus areas is not the only source of
confusion. Each nancing stream has its own funding mechanism: GEF and GCF
funding comes through UNFCCC funding mechanisms; AF receives funds from
Clean Development Mechanism (CDM) carbon market transactions; and the
CIF receives funds from donor nations independently of UNFCCC mechanisms.
27 Peters et al. 2007, Turnbull
et al. 2011
18
Figure 2.1
Governance of global public-sector climate finance 28
The independent nancing mechanisms have led to cases where national and
sub-national players have built capacity to develop bankable climate proposals
only to nd the targeted funds empty. One such example is the Least Developed
Countries Fund (LDCF), which provides climate adaptation funding to the
world’s 48 least developed nations. The LDCF, which is managed by the Global
Environment Facility (GEF), depends on voluntary contributions from developed
countries. While least developed countries were working to build capacity and
develop high quality proposals, the funding dried up.29 This indicates the signicant
uncertainty associated with these funding sources.
Too Few Points for Access, Access Points at Wrong Governance Scale
National and sub-national actors also need more ways and a wider variety of ways
to access adaptation funds. Several funds have an approval process that designates
the particular organizations which have direct access to its funds. The designated
national implementing entities (NIEs), regional implementing entities (RIEs), and
multilateral implementing entities (MIEs) then engage with national and local
partners to assess and support funding proposals. From a bottom-up perspective,
there appear to be too few implementing entities. The geographic purview of
the implementing entities is too broad; most of those operating in Southeast
Asia are MIEs. Both the small number of implementing entities and the scale
at which they operate present challenges in furthering sub-nationally relevant
interventions. Institutional pressures to distribute climate funds limit the variety of
new projects funded in favor of types of projects that have been funded in the past.
Further, because climate nance in general and adaptation nance in particular
require specialized information and specic capacities, the situation is primed
for gatekeeping or for small groups to restrict access. Gatekeeping need not be
an intentional, malicious effort but can emerge from incentive and institutional
structures. A greater number of implementing entities would provide more
access to funds for more projects, which would allow more varied and, potentially
innovative, adaptation.
28 Bours 2017. Note that the
Global Environmental Fa-
cility (GEF) acts as interim
secretariat for the Adap-
tation Fund (AF). The AF is
nanced through the Clean
Development Mechanism
(CDM) which is an emis-
sions trading mechanism
29 Huq 2016 GEF Secretariat
Least Developed Countries Fund (LDCF)
Green Climate Fund (GCF)—50% of Funding to Adaptation
Non-UNFCCC
Financial
Mechanisms
UNFCCC
Financial Mechanisms
Special Climate Change Fund (SCCF)
Pilot Programme for Climate Resilience (PPCR)
as part of the Strategic Climate Fund (SCF)
Climate Investment Funds
Administrative Unit (CIFs AU)
Adaptation Fund (AF)
Adaptation for Smallholder
Agriculture Programme (ASAP)
International Fund for
Agricultural Development (IFAD)
19
Bankable Projects
Global funds have drawn attention to the lack of bankable adaptation projects as
a major challenge. Deciding what is ‘bankable’ usually requires assessing the value
of a project against set criteria, such as a business plan that shows sustainability
or a cost-benet analysis that shows the value added by public infrastructure
to growing an economy (and by extension, improving livelihoods). In climate
adaptation nance, bankability also means showing how the nancing sought will
address climate adaptation needs.
From the perspective of global funds, the proposals they receive appear to
be standard development projects ‘repackaged’ as climate adaptation projects.
From the bottom-up perspective, this perceived repackaging is not just a pitch
for available nancing but the result of two things: i) the lack of clarity about
what climate adaptation is; and ii) the lack of capacity to contextualize global
information (on climate change) into development interests (local context). The
often weak or missing link between the proposed activity and the impacts of
climate change is partly due to the difculty of assessing ‘climate adaptation’ (see
next section on challenges in dening climate adaptation nance) but is also partly
due to a lack of capacity ‘on the ground’ for identifying local-level threats posed
by climate change. Because decision-makers do not know what the implications of
climate change are in their location, they cannot always clearly link the impacts of
climate change to what the proposed projects aim to achieve.
An example of an effort to address this is the Adapt Asia-Pacic program,
which took the lead in exploring how to engage global nance systems, initially at
the national level and later at more local levels. The goal of the program is to build
the capacity of institutions in-country to manage funds, and effectively identify and
implement climate projects.
One of the biggest challenges from the bottom-up perspective is the longer
timeframes and wider spatial scales of the top-down perspective. In work done
by ISET-International across 20 cities a consistent refrain of stakeholders is that
there is weak demand for spending precious resources on addressing future issues
because there are so many current, pressing ‘now’ issues. Finding ‘win-win’ projects
is key to addressing this challenge but the knowledge to do this requires yet further
capacity. Developing this capacity is challenging in local contexts and buying in
capacity by using external consultants incurs high costs.
Recommendations
Many of the challenges that climate adaptation nance faces are similar to those
experienced in development. There seems to be continual tension in balancing
the longer view and larger spatial scales of international and national governance
with the shorter term, more locally contextualized scales of provincial, municipal,
and community work. Because of the wide variety of experiences and points of
view around the issue of the appropriate scale of action, the challenges could be
described as ‘wicked problems’.30 A key characteristic of ‘wicked problems’ is
that they cannot be resolved; rather, they require people to come together to
nd solutions. To that end, three suggestions for ways to help tackle some of the
challenges experienced at the local level are offered below.
20
30 Ramalingam et al. 2014
31 Adger et al. 2005
32 Doher ty et al. 2017
33 Venkateswaran and Mac-
Clune 2016
34 Halimanjaya and Maulidia
2014
35 Bettinger 2017
Address Top-Down Issues
As mentioned earlier, there is value in addressing climate adaptation at different
scales31 and such action needs to be supported. However, adaptation to climate
change happens autonomously at local scales. Local adaptation may potentially
preclude adaptation planned at larger scales and may be locally maladaptive in the
long term.32 This suggests that moving more decision-making and planning to local
levels may be more responsive and relevant to local needs.
Create Funds for Nationally-Directed Adaptation Finance
National adaptation funds could go a long way to helping bridge the gap between
local needs and international funding mechanisms. Unlike international institutions,
national institutions are in touch with demand-side pressures and can quickly
mobilize as demand becomes apparent. Two examples of nationally-led efforts
to nance climate-change issues in Southeast Asia are the Philippines Climate
Change Commission (CCC), and the Indonesia Planning Ministry (Bappenas) and
Indonesian Climate Change Trust Fund (ICCTF). Both efforts have encountered
challenges. CCC faced difculties in moving funds and addressing local adaptation
demand
33 while ICCTF struggled to address broader institutional efforts and meet
international nance standards.34 Like international nance institutions, these
institutions have made much progress and engagement has improved.35
In addition to national funding, increasing the number of implementing
entities, particularly national and, ideally, sub-national, that have direct access to
global funds would also improve access to nance. Expanding access to nance
would promote a broader suite of adaptation actions. This would allow more
innovation and adjustment as climate change unfolds.
Enhance Capacity and Simplify the Process of Accessing Finance
Increasing the number of implementing entities especially at the local level,
would both enhance the capacity of local and national institutions to assess local
contexts and prepare to manage adaptation nance and, also, would address
the need for global funds to understand recipients’ contexts to help them better
distribute adaptation nance. Efforts to enhance capacity have been underway in
Southeast Asia. The United Nations Development Programme (UNDP) provides
training. Work by USAID Adapt Asia-Pacic in recent years has engaged local
institutions, such as municipalities, in building ‘climate nance ready’ proposals.
It is, however, not clear what work is actually being done to understand local
contexts. Institutions pursuing adaptation would do well to incorporate more
social scientists into their ranks, particularly ethnographers, to help illuminate
the cultural map of climate nance and perhaps to nd out how best to empower
national and local actors.
21
Conclusions
This chapter has examined some of the challenges that governance at different
scales faces in nancing climate adaptation. To be clear, great strides have been
made in a relatively short time on nancing action to adapt to climate change;
this should be celebrated. Nonetheless, there is a need to bridge the gap between
global nancial streams and locally planned autonomous adaptation. Perhaps the
biggest paradigm shift needed is to address the mindsets of expertise, power, and
purview that hamper local adaptation. Bridging the gap should be done in a way
that promotes actions that serve locally identied adaptation needs.
Funding to address climate change emerged from global concern. Many of
the nancing measures to deal with climate change reect the global institutions
which framed the issue. Measures to nance adaptation to climate change are
no different in that global funds are set up so as to interact with global, regional,
and in a limited number of cases, national engagement partners. In contrast to
measures to mitigate the effects of climate change, which require a top-down
understanding of the interplay of actions and results, measures to adapt to the
effects of climate change are extremely context-specic and will have local
impacts and affect social conditions. Further, most adaptive action will take place
autonomously at household and community levels as people react and adjust
to changes in their environments. Thus, climate adaptation gives us a unique
opportunity to build engagement and bridge top-down and bottom-up efforts to
engage across scales (and associated cultures) of knowledge.
Naznin Nasir
International Centre for Climate Change
and Development (ICCCAD), Bangladesh
M. Feisal Rahman
Independent University, Bangladesh
Saleemul Huq
International Institute for Environment
and Development (IIED), United Kingdom
Sam Ogallah
Pan African Climate Justice Alliance
(PACJA), Kenya
Financing Adaptation in
the Least Developed Countries
Chapter 3
23
36 UNEP 2015 To enable developing countries to effectively implement their Nationally
Determined Contributions (NDCs) as established in the Paris Agreement and to
meet their commitments toward achieving the Sustainable Development Goals
(SDGs), there is urgent need for an important means of implementation: nance.
Climate adaptation nance has everything to do with who or which country is
providing the nance, who or which country is receiving such support and for
what purpose, and, be it public or private nance, through which delivery channel.
Transparency of actions, accountability, and governance of such nancial support
(by developed and developing countries) is crucial to achieving the objectives of
the Paris Agreement and the SDGs.
There are enormous costs associated with adaptation, especially in the
countries that are most vulnerable and under-resourced, making comprehensive
and effective systems of climate nance extremely important. For example, the
United Nations Environment Programme (UNEP)Adaptation Gap Report
suggests that adaptation costs for Africa alone might be in the range of USD
50 billion a year by 2025/2030.
36 This is a huge sum for a continent that already
confronts widespread poverty, social and economic inequalities including gender
inequality, lack of institutional capacity, and insufcient support from developed
countries to help adapt to climate impacts.
Additionally, there is a pressing need to develop accounting methodologies
for climate nance that are accurate and uniformly applied across contexts. To
avoid inaccuracies in accounting, such as double counting support for climate
adaptation and differences in effective adaptation to the impacts of climate change
in developing countries, several issues must be addressed. These issues include
the roles of non-United Nations Framework Convention on Climate Change
(UNFCCC) Party stakeholders in constructively engaging with states, the private
sector, and UNFCCC Party stakeholders to track (monitor, evaluate, and report)
climate adaptation nance at all levels.
Climate nance faces challenges: double counting by donors, risks of
channeling funds to irrelevant projects, corruption, and lack of capacity. There
is, therefore, an urgent need to monitor and track climate nance ows and to
develop a supportive framework for monitoring and tracking to ensure that
resources are channeled to climate-change interventions that align with national
priorities and reach vulnerable communities.
It is clear that there are many facets to the challenges of climate adaptation
nance, particularly in terms of provision, use, accounting, and transparency.
However, an important issue is to assess to what extent the countries most in need
are able to access funding sources. This chapter examines the Green Climate Fund
(GCF) and the ability of least developed countries (LDCs) to make use of it.
As countries search for money to implement costly adaptation projects, it is vital
that international climate nance mechanisms deliver resources where they are
needed most.
Least Developed Country Access to the Green Climate Fund
The Green Climate Fund (GCF) is set to become the central fund for
implementing the Paris Agreement; it will distribute the bulk of the USD
24
37 GCF 2017a 100 billion that industrialized countries aim to mobilize every year for climate
mitigation and adaptation from 2020 onwards. The Fund, launched at the climate
negotiations in Cancun in 2010, has so far received pledges of USD 10.3 billion.
Founde d wit h the obje ctive of suppo rting a pa radigm sh ift t o low -carb on, climat e-
resilient development, the Fund began nancing projects and programs in 2015.
As of the end of September 2017, 43 projects had been approved, worth more
than USD 2 billion. There is no doubt that the progress made by the GCF so far
is important in successfully implementing the Paris Agreement. However, despite
this positive progress, the Fund has yet to overcome several hurdles in realizing
the promised paradigm shift. This chapter attempts to reect on and evaluate the
progress of the GCF thus far from the perspective of LDCs.
Adaptation Funding as Opposed to Mitigation Funding
At its inception, the GCF promised to dedicate half of its funds to adaptation (the
other half going to mitigation), an aspiration that would be achieved “over time”.
Of the 54 approved projects, 25 are adaptation projects amounting to USD 777.3
million (30% of the total allocated funds). USD 1.063 billion has been allocated
to 16 mitigation projects and USD 739.9 million (31%) to cross-cutting projects,
incorporating both adaptation and mitigation.37 As Fig ure 3.1 s hows, a dapta tion-
only projects receive signicantly less funding than mitigation projects, though
there have been more adaptation projects approved in total.
Figure 3.1
Green Climate Fund approved projects and allocated
funding (as of October 2017).
Left: Funding allocated (USD)
Right: Approved projects (total 54)
25
46.5%
13
23.3%
16
30.2%
$1063 m.
41%
$777.3 m.
30%
$739.87 m.
29%
No. of approved projects
TOTAL NUMBER OF APPROVED PROJECTS
54
CROSS-CUTTING
MITIGATION ADAPTATION
25
38 Ibid.
39 Ibid.
40 GCF 2017b
The GCF aims for “geographic balance”, paying special attention to “particularly
vulnerable” countries, including least developed countries (LDCs), small island
developing states (SIDS), and African states. Among the 25 adaptation projects
approved so far, 12 projects, amounting to USD 357.6 million or 46% of the funds
allocated for adaptation, went to LDCs.38 Among the 13 c ross- cutti ng pr ojects,
four projects amounting to USD 172.6 million were directed to LDCs (one of the
projects also involved a non-LDC country).39 Only two mitigation projects out of
the 16 approved targeted multiple LDCs. The two projects also included several
non-LDCs, as such only partial project funds will be going to the targeted LDCs.
Direct Access to Funds—A Far Cry for Least Developed Countries (LDCs)
The GCF accredits international, regional, and national implementing entities
eligible to access funds. As of September 2017, GCF had accredited 59 entities,
of which 21 are national implementing entities (NIEs), 27 are multilateral
implementing entities (MIEs), and 11 are sub-national or regional implementing
entities (RIEs). Out of the accredited 21 national implementing entities, ve
are in LDCs.40 Consequently, it is crucial to thoroughly analyze the reasons why
developing countries experience delays in directly accessing funds and to discuss
countermeasures. Without direct access through an implementing agency, it is
difcult for LDCs to acquire GCF funding; this difculty is an obstacle to carrying
out their adaptation plans. Implementing agencies have the benet of allocating
a steady group of resources and personnel to focus on GCF project development,
as opposed to governments or organizations that must round up time and
resources each time they seek to develop a project through GCF.
Instead of engaging national and local agencies which work closely
with communities vulnerable to the effects of climate change, most projects
are channeled through international agencies, mainly United Nations (UN)
institutions and regional development banks. So far, seven national implementing
entities (leading nine of the 54 projects approved) have had projects approved and
only two of those are in the LDCs (Senegal and Ethiopia). Of the approved funds
only 14% went to direct access entities (NIEs and RIEs) as opposed to 86% that
went to international entities (MIEs) (Figure 3.2).
GCF accreditation and proposal development processes are fairly
complicated and require substantial resources. International institutions are more
experienced and far more competent than national institutions in mastering
the complicated GCF accreditation process and, as such, have more access to
resources for developing projects. Boosting country ownership is one of the
key objectives of the GCF but the statistics suggest that GCF is falling short of
achieving that goal. The analysis of approved projects also raises concerns that
GCF is not bold enough in supporting local entities in LDCs that need to build
capacity to undertake climate change and development initiatives.
26
41 Phakathi 2017
42 Klemm and Or túzar 2017
43 TI Korea 2017
44 Darby 2017
Figure 3.2
Approved projects and allocated funds by access modality.
Adaptation as Opposed to Development
During the 15th and 16th board meetings of the GCF, the board failed to reach
consensus on approving adaptation proposals submitted by two LDCs —
Bangladesh and Ethiopia. The proposed project in Bangladesh focused on
enhancing the adaptive capacity of women in coastal districts of Bangladesh. The
Ethiopian proposal aimed to help marginalized farmers and communities deal with
the growing risk of drought. The Bangladesh proposal was ultimately withdrawn
by the implementing entity to avoid rejection. The GCF Board failed to accept
the Ethiopian proposal. Surprisingly, around the same time, the board approved
the contentious refurbishment of a Soviet-era hydropower dam in Tajikistan. Such
decisions raised concerns about the board’s approach to adaptation and also
pointed to a ‘rich-poor’ divide within the fund.41
The hydropower project attracted considerable criticism from civil
society organizations. For example, the project did not have the potential to
meet Tajikistan’s pressing energy needs and avert alarming overdependence on
hydropower (98% of the country’s energy is generated by hydropower).42 The
project could also discourage the development of other renewable energy. Reports
indicate that the proposal did not mention whether or not local residents were
consulted and lacked clarity on how the project would improve access to electricity
by women.43 Questions were also raised by civil society about the ‘transformational
change’ that the project would bring about given that almost all the country’s
power already comes from hydropower.44
While there the board raised some technical concerns about the proposed
projects in Bangladesh and Ethiopia, the main disagreement about the viability
NIE RIE
NO. OF PROJECTS ALLOCATED FUND
Direct Access International Access
MIE
16.4% 9.3% 74%
Direct Access
$348.4 Million
(14%)
International Access
$2231.8 Million
(86%)
NIE National Implementing Entities
MIE Multilateral Implementing Entities
RIE Regional Implementing Entities
27
45 See Phakathi 2017
46 IIED 2015
of the projects appeared to arise from differences in opinion and perception
among developing and developed country members about which activities and
interventions could be considered as adaptation and which as development.
In both cases, the developed country board members saw the projects more as
development rather than as ‘climate change adaptation’. The concern raised by
observers and board members from developing countries was that projects were
being side-lined because of unclear assessment standards. Some also suggested that
the distinction between adaptation and development interventions in allocating
funding is a potential cause of injustice between richer and poorer countries, as
poor countries do not receive necessary adaptation funds as rich countries debate
about denitions.
Since the withdrawal and rejection of the two project proposals, civil society
organizations (CSOs) have raised their concerns with the GCF board regarding
its approach to adaptation, and have asked for clarity and guidance on the
issue. In a letter
45 sent to the board, it was argued that “the distinction” between
adaptation and development was “largely articial”. The letter maintained that
the board is biased in favor of proposals that take “technological approaches to
adaptation” like climate proong or building new physical infrastructure as they
are “easily quantiable and more straight forward”. According to these CSOs,
adaptation nance should target activities that will both increase adaptive capacity
and address development decits in order to bring about the ‘paradigm shift’
advocated by GCF.
The strong relationship between climate vulnerability and other
development decits, such as lack of education or lack of climate-resilient
livelihood options, is often ignored. The question is whether it makes sense to
consider adaptation and development as distinct issues, especially as the GCF is
committed to ensuring that all of its nancing is rooted in sustainable development.
In light of climate change, good development should be sustainable and climate-
sensitive; adaptation can only be effective if the root causes of vulnerability
associated with underdevelopment are addressed. Thus, on the one hand it is
crucial to consider sustainable development, including social, economic, and
gender-equitable impacts while designing and implementing climate projects and,
on the other hand, to consider the possible consequences of climate change while
planning and implementing development projects.
Can Least Developed Countries Count on the Green Climate Fund?
The International Institute for Environment and Development (IIED) estimates
that the cost to the 48 LDCs of implementing their post-2020 climate action plans
could be around USD 93 billion a year.46 As yet, only four LDCs have managed to
accredit national entities with GCF. The money allocated by GCF for adaptation
in LDCs is less than half a billion dollars. At this rate, it will take decades for
the GCF to provide adaptation funding to all the LDCs. Given that the poorest
communities in the LDCs are already facing the adverse, it would seem that
putting their faith in getting funding from the GCF may not be worth the effort
and that funding may not materialize in time for them to prevent the devastating
28
47 Huq and Nasir 2016 effects of climate change.47 Instead, LDCs may have to be proactive in using their
own resources to adapt to climate change. While this is what LDCs are fortunately
already doing, the costs of climate adaptation will be enormous; international
support through the GCF is still urgently needed.
Finance is critical for implementing adaptation. Although the GCF offers
developing countries an important opportunity to access nance, it must be
held accountable for fullling its promises regarding the allocation of funds and
ensuring that a substantial portion go to the most vulnerable countries. With
this promising funding mechanism in place, it is now urgent that it is made easily
accessible by those who need it most.
29
Javier Gonzales-Iwanciw
and Fablana Mendez-Raya
Nur University, Bolivia
Adaptation Funding and
Governance in Latin America
and the Caribbean
Chapter 4
30
48 Between 2015 and 2017,
the authors conducted a
review of M&E frameworks
for adaptation, interviewing
key informants and focal
points in six LAC countries;
in addition, they took part in
reviews of the Strategic Pro-
gram for Climate Resilience
of Bolivia and Honduras,
and the GCF Readiness
process in Colombia. This
experience and data collec-
tion has complemented the
review of GCF Readiness
documentation in selected
LAC countries
Latin American and Caribbean countries (LACs) were very active in the
preparation and adoption of the Paris Agreement. Almost all countries in the
region – except Nicaragua – have submitted Nationally Determined Contributions
(NDCs) as part of their ratication instruments. LACs are among the countries
that are most vulnerable to climate change. Despite some uncertainty, the impacts
of climate change on critical sectors and important areas of economies are already
well known and are expected to intensify in the coming years. The livelihoods of
families and local economies, infrastructure, and ecosystems that support the
well-being of populations will be at risk.
On transparency and accountability, the Paris Agreement (Article 7)
states that Parties should:
“…follow a country-driven, gender-responsive, participatory and
fully transparent approach, taking into consideration vulnerable
groups, communities, and ecosystems, and should be based on
and guided by the best available science and, as appropriate,
traditional knowledge, knowledge of indigenous peoples and local
knowledge systems, with a view to integrating adaptation into
relevant socioeconomic and environmental policies and actions.”
In addition, Parties should strengthen their cooperation on enhancing action
on adaptation, taking into account the Cancun Adaptation Framework, and
including, among other things, assessing vulnerability and the impacts of climate
change. This should be done with a view to formulating nationally determined
prioritized actions and plans, taking into account vulnerable people, places, and
ecosystems. Monitoring and evaluation (M&E) mechanisms should be established
to better learn from adaptation plans, policies, programs, and actions. Through their
NDCs, countries are entitled to receive technical and nancial support from the
international community and will be evaluated in terms of their achievements
and progress.
One nancial mechanism, the Green Climate Fund (GCF), has made
available a preparation scheme (GCF Readiness) to help countries in their
efforts to access GCF funds and build their capacities to achieve their NDCs.
Together with the Paris Agreement mandate, GCF Readiness has the potential
to put in place novel institutional arrangements that enhance participation and
coordination among stakeholders, including society’s most vulnerable groups.
These new arrangements could thus support the development of governance
structures that bring more transparency and accountability at different levels.
Drawing on adaptation program reviews and interviews (see Table 4.1)
with focal points and other key informants carried out between January 2015
and September 2017,48 this chapter describes progress in adaptation governance,
institutional development, transparency, and accountability in selected LACs.
31
Table 4.1
Data gathering in selected Latin American and Caribbean countries.
Adaptation Governance Trends in Latin America and the Caribbean
LACs are middle- to high-middle-income countries. They have been putting in
place increasingly sophisticated public policy instruments for adapting to climate
change. All countries in the region have climate change strategies in place that set
adaptation goals in strategic sectors. Most LACs also have policies and governance
systems for climate change adaptation; the Climate Change Law in Guatemala
and the Mother Earth Framework Law in Bolivia are good examples. In addition,
almost all countries have started developing national adaptation plans.
Thus far, countries have only initiated sectoral adaptation plans. Chile, for
example, has dened adaptation processes within the framework of a National
Climate Change Strategy. Colombia has integrated its National Adaptation Plan
(NAP) into the framework of its National Development Plan. Chile has also set
sectoral targets in ‘agriculture’ and ‘biodiversity’, and is in the process of dening
targets for seven other sectoral plans. Colombia has established 15 sectoral and
territorial plans to strengthen commitment to incorporating climate change
considerations into planning by the territories. Interestingly Colombia has dened
‘regional nodes’ to enhance social participation in following up on the plans.
Mainstreaming adaptation at the policy and sector levels, establishing
intersectoral coordination mechanisms and dialogue with international climate
nance institutions, and implementing adequate M&E systems are critical policy
instruments countries are putting in place to advance climate adaptation agendas.
Ta bl e 4 . 2 s u mm a ri z e s t he ma i n t r en d s i n s e le c te d co u nt r ie s in LA Cs .
COUNTRIES SPCR REVIEWS GCF READINESS M&E FRAMEWORKS
Bolivia × ×
Chile ×
Colombia × ×
Costa Rica ×
El Salvador ×
Guatemala ×
Honduras ×
Panama ×
Peru × ×
Dominican Republic ×
SPCR Strategic Programs For Climate Resilience
GCF Green Climate Fund
M&E Monitoring And Evaluation
32
Table 4.2
Adaptation governance in selected Latin American and Caribbean countries
NATIONAL POLICIES /
ADAPTATION PLANS
MAINSTREAMING CLIMATE
CHANGE ADAPTATION IN
KEY SECTORS
CLIMATE FINANCE
COORDINATION
M&E FRAMEWORKS
Bolivia
Mother Earth Law Pilot Program for
Climate Resilience
(PPCR) investments in
the water sector
Coordination
mechanism initiated
under the Nationally
Designated Authority
At the level of the
water sector
Chile
National Climate
Change Strategy
Climate change sector
plans e.g. agriculture
sector, biodiversity
Adaptation M&E in
the agriculture sector
Colombia
NAP Multiple sectors Climate Finance
Coordination
Committee
Climate nance
Monitoring, Reporting,
and Verication
Costa Rica
National Climate
Change Strategy
NAP under developm ent
Blue Flag Program /
Involvement of the
private sector
El Salvador
Ministry of Foreign
Affairs
Climate Public
Expenditure and
Institutional Review
Guatemala
Climate change Law,
policy and National
Climate Change
Action Plan
Honduras
Climate Change Strategy Pilot Program for
Climate Resilience
(PPCR) investments
in the water and
agriculture sectors
Panama At the level of
strategic watersheds
Peru
Labeling of disaster
risk and adaptation
investments
Dominican
Republic
National climate change
strategy
33
49 The Climate Investment
Funds (CIF) are made up
of two funds, the Clean
Technology Fund (CTF) and
the Strategic Climate Fund
(SCF)
Climate Investment Funds (CIF) Pilot Program for Climate Resilience
(PPCR) Investments and Mainstreaming Adaptation
The Pilot Program for Climate Resilience (PPCR) is a targeted program under
the Strategic Climate Fund (SCF),49 which was established to assist developing
countries in integrating climate resilience into their development planning.
PPCR criteria ensure:
·Programs are developed on the basis of the best available information
on the key climate impacts in a country.
·Cross-sectoral coordination between levels of government.
·Adequate stakeholder engagement and participation, including the
participation of other relevant actors (e.g. private sector, civil society,
academia, donors, etc.), allows for scoping of prioritized activities in
a way that takes into account relevant development priorities and
sectoral policies.
·Ongoing policy reform processes.
·Relevant activities and strategies have been identied to address
the needs of highly vulnerable groups.
Many of these criteria are addressed during the development of national Strategic
Programs for Climate Resilience (SPCR) when authorities are encouraged to think
about mainstreaming climate resilience across their activities.
In Bolivia, PPCR investments have served to integrate climate resilience
into planning in the water sector at different levels. Pilot projects aim to enhance
the resilience of the water supply system in La Paz – El Alto, and to develop
planning tools and guidelines for making water infrastructure projects, including
water supply and irrigation systems, climate resilient.
Additionally, the PPCR subcommittee has emphasized the importance of
exploring synergies between the preparation of SPCRs, other Strategic Climate
Fund (SCF) programs, and the UNFCCC national adaptation plan (NAP) process.
Honduras has allocated USD 100,000 of USD 1.5 million PPCR funding to the
International Finance Corporation (IFC) for a study on the role of the private
sector in climate-change adaptation in the country.
At present, PPCR does not have sufcient funding to nance the projects
and programs that may be proposed in new SPCRs. In light of this, the new pilot
countries are expected to design SPCRs to attract funding from other sources,
including the Green Climate Fund (GCF), in addition to any resources that may
become available from PPCR.
Green Climate Fund (GCF) Readiness in Latin America
and the Caribbean
The GCF Readiness process should serve, among other things, to inform
stakeholders, including in the academic sector, civil society groups, and the private
34
50 GCF 2015, updated with re-
cent readiness information
sector, about the funding options available from GCF. The process should establish
coordination mechanisms and administrative procedures for prioritizing and
endorsing GCF project and program proposals.
GCF Readiness provides up to USD 1 million per country per year in ve
activity areas. Of this amount, nationally designated authorities (NDAs) or focal
points can request up to USD 300,000 a year to help establish or strengthen an
NDA or focal point to meet the GCF requirements. In addition, GCF Readiness,
upon request, can provide up to USD 3 million per country for developing
adaptation plans. The Readiness Program consists of ve areas:
1. Strengthening the focal point and nationally designated authorities.
2. Supporting the development of strategic frameworks.
3. Selecting intermediary and/or implementing entities.
4. Developing program and project proposals.
5. Exchanging information and experiences.
LACs have approached GCF Readiness in different ways; they have strengthened
the capacities of their NDAs and put in place rules to enhance stakeholder
participation and coordination (see Table 4.3).
Table 4.3
Green Climate Fund readiness in selected Latin American and Caribbean countries 50
All LACs selected for the review rapidly designated national authorities and
focal points to work with GCF.
Initial GCF activity (Activity 1) is typically oriented to strengthening capacities
in country NDAs. Activity 1:
·Evaluates the institutional capacities of country-designated
departments or ministries to fulll their roles and functions as NDAs.
·Strengthens capacities, processes, systems, and procedures for
preparing programs and projects to be presented to the GCF.
·Establishes a coordination and consultation mechanism among
ministries on Fund-related matters.
COUNTRIES GCF READINESS ACTIVITIES IMPLEMENTING
ENTITY
1 2 3 4 5
Bolivia × × NDA
Colombia ×××UNDP
El Salvador × ×××NDA
Guatemala × × × UNDP
Honduras × × × UNDP
Peru × × GIZ
Dominican Republic ××× UNDP
35
·Facilitates communication among stakeholders on matters
related to the Fund.
·Involves stakeholders, including government departments,
representatives of the private sector, civil society groups, and
international actors, in dialogue.
The second activity (Activity 2: Strategic Frameworks) identies country
development priorities with respect to the GCF, national policies and plans, other
strategic sectoral plans, and the Fund’s initial results management framework.
Activity 2 includes evaluating national entities that could be accredited
by GCF and potential roles for multilateral accredited entities. It also involves
identifying synergies with the work of other development partners in the country
and leveraging their capacity to implement programming priorities. Development
partners could help develop concept notes for national/sectoral multi-stakeholder
consultations to identify development priorities with respect to GCF.
Climate Finance Coordination
Colombia initiated a GCF Readiness process in 2014. The process is facilitated
by the National Planning Department (DNP). The GCF Readiness program
supports the Finance Management Committee’s overarching interdepartmental
coordination system (SISCLIMA), that was established in 2014. The committee
involves government and nancial entities and aims to bring in private sector
entities in the near future.
The GCF Readiness program also supports the Finance Management
Committee in coordinating public policies for including climate change criteria
in national nancial and economic plans. The program supports efforts to develop
and implement the committee’s work plan. These efforts include:
·Strengthening government capacities to access and manage
climate nance.
·Enhancing knowledge and skills to develop climate projects
especially in the private sector.
·Supporting existing initiatives of local nancial institutions
to build the skills required for climate-related investment.
The GCF Readiness program not only facilitates access to GCF funding but also
helps improve access to other international and domestic sources of funding, and
channel private sector investment.
In addition, the program serves to communicate the advances Colombia
is making in nancing ways to deal with climate change and in a measurement,
reporting, and verication (MRV) system for climate nancial ows. The MRV
system has been operational since the beginning of 2017 and responds to the needs
of different actors, including in government, and the nancial and private sectors.
A study in El Salvador supported by the GCF Readiness program used the
Climate Public Expenditure and Institutional Review (CPEIR) tool to examine
36
51 e.g. Silva-Villanueva 2011,
Ford et al. 2013, FCCC/SB-
STA/2010/5, AC/2014/4
52 Asociación Independiente
de América Latina y el
Caribe
53 Gonzales-Iwanciw and
Mendez-Raya 2015
national public expenditure on climate change and ways to make decision-making
in the eld more efcient. The study identied ways to design more effective
public policies.
Monitoring and Evaluation Frameworks, Participation,
and Transparency
Multilateral funds, such as the Global Environment Fund (GEF), the Climate
Investment Fund (CIF), and the Green Climate Fund (GCF), and United Nations
(UN) implementing agencies, multilateral banks, the Organisation for Economic
Co-operation and Development (OECD), and the United Nations Framework
Convention on Climate Change (UNFCCC) have been developing frameworks for
monitoring and evaluating adaptation. The systems do not always follow similar
principles, approaches, and conceptual frameworks, so are very different and
difcult to compare. Several reviews and efforts at systematization51 aim to make
the frameworks more consistent.
At the national policy level, adaptation M&E tracks the process of capacity
building (enabling activities) and the outcomes of adaptation plans at different
levels, sectors and territorial scales. M&E also tracks indicators recommended by
the International Strategy for Disaster Reduction (ISDR) and country disaster
recovery plans. At the level of sectoral plans and programs, M&E relies on the
programmatic approaches to results-based management required by the various
sources of nancing that seek to internalize climate change considerations. In
territories, M&E emphasizes systemic approaches, such as Ecosystem-based
Adaptation (EbA), and approaches to socio-ecological resilience.
A review of M&E in six LACs, conducted by Nur University researchers for
the Independent Association of Latin American and the Caribbean (AILAC)
52 in
2015, concluded that all the countries are considering developing M&E systems
for adaptation. These systems would be linked to the processes for dening terms
in public policy. In Guatemala, for example, the Climate Change Law mandates
mainstreaming adaptation to climate change and promotes guidelines for
implementing measures to reduce vulnerability. The law provides institutions with
a strong mandate to justify establishing M&E systems to track goals and results.
The six countries have similar climate change strategies or instruments, for
example integrating climate change considerations into national development
plans, implementing national adaptation strategies, and integrating adaptation in
sector plans. The strategies are encouraging the public sector to think about and
dene processes for adaptation M&E. Cooperation agencies, donors, and civil
society organizations also support efforts in M&E adaptation.
Monitoring and evaluating adaptation to climate change follows up on
public policy, sectoral targets, country regulations, and adaptation projects
supported by international nancing.53 Focal points in the six countries agree
that adaptation targets are one of the factors that most clearly motivate an M&E
system. In the case of countries that are beginning to adopt OECD regulations
37
(Colombia and Chile), but also in Peru, results-based management frameworks,
which are expected to include indicators of adaptation to climate change, are well
known and can be adopted for adaptation M&E. For example, Peru has made
signicant progress in monitoring and labeling public nances for climate disaster
risk management and adaptation.
There is still little progress in involving the private sector and civil society in
monitoring adaptation measures. In many cases, the private sector is better able
than the public sector to generate and systematize information generated in
the sectors in which it is involved. For example, there is the potential to involve
insurance and re-insurance companies in expanding the climate-risk information
base so that it can be used more widely. However, efforts to involve the private
sector and civil society are poorly organized and are disconnected from denitions
of adaptation and other policy standards set through public-sector processes.
Costa Rica integrates adaptation in environmental management, generating
valuable lessons on involving the private sector and civil society. The Blue Flag
Program and Carbon Neutral Municipalities in Costa Rica are both mechanisms
for involving the private sector and local communities in mitigation and adaptation
efforts, and also in M&E.
Conclusions
LACs are making solid progress toward putting in place institutional frameworks
and rules to foster adaptation. Early experiences in CIF–PPCR in building
adaptation capacities in six countries and in the more widespread GCF Readiness
program have the potential to inuence the development of good governance
standards that permit broader segments of society to participate, greater
transparency in decision-making, more effective public policies, and better
accountability at different levels. There is an emphasis on stakeholder coordination,
sector-wide planning, and M&E systems.
The GCF is working to facilitate UNFCCC decisions on accrediting
national entities. LACs, depending on their circumstances, are working to
establish mechanisms to allow participation by the private sector, civil society,
and vulnerable segments of society in the development of public agendas.
Toward Climate Finance Reporting
Systems in Latin America
Chapter 5
Toward Climate Finance Reporting
Systems in Latin America
Chapter 5
Sandra Guzmán,
Alin Moncada,
Nella Canales,
Mariana Castillo,
and Tania Guillén
Climate Finance Group for Latin America
and the Caribbean (GFLAC)
39
54 UNFCCC SCF 2016 Latin America is highly vulnerable to the impacts of climate change, while itself
contributing to global greenhouse gas emissions. Climate nance is therefore
critical to help the region pursue low-carbon and resilient development. However,
despite the importance of climate nance, it has proved difcult to effectively track
how this nance stream ows to and within the region.
According to the Biennial Assessment of Climate Finance, Latin America
and the Caribbean shared 23% of the world’s total climate nance ows between
2013 and 2014.54 However, given the lack of internationally agreed guidelines, this
percentage can vary depending on what is being considered as climate nance, the
geographical scope of the analysis, the time frames used, and other variables that
depend highly on who is reporting the ows. So far, donor countries carry out most
of the world’s climate nance reporting.
The Climate Finance Group for Latin America and the Caribbean
(GFLAC) proposes common guidelines to create monitoring, reporting and
verication (MRV) systems for climate nance in developing countries. Such
systems would be an important tool in gaining a better understanding of the origin
and destination of climate nance ows. If in place, these systems could provide
harmonized information from a recipient countries’ perspective, while increasing
transparency and accountability for donor countries; they could also provide a
starting point for assessing the effectiveness of climate nance.
This chapter rst identies the challenges in using global- or regional-level
reporting to understand how much climate nance exists in the Latin American
and Caribbean region. We then review the experience of GFLAC by looking at
its analysis of climate nance within eight countries in the region in 2014 and
2015, to identify challenges relating to reports produced by developing countries.
Finally, we make the case for establishing MRV systems within Latin American
and Caribbean countries, as an important practical tool to close the current
transparency gap on climate nance in the region.
Tracking Climate Finance in Latin America and the Caribbean
Using International Reporting
Most of the global-level reports on climate nance depict or discuss the
geographic distribution of nance ows; within this distribution Latin America
and the Caribbean features as a recipient region. The global-level reports map
international public ows of public nance from developed to developing
countries, based on information reported by ‘donor’ countries and institutions.
Given the lack of ofcial guidelines and international agreement on what
constitutes climate nance, different institutions report different ows. In addition,
the fragmented nature of global climate nance – with public sources of climate
nance owing bilaterally between nations or via multilateral climate funds and
multilateral development banks (MDBs) – also generates difculties for tracking.
Thus, understanding how much total climate nance has reached the region
remains challenging.
To illustrate these challenges, we identied what is being reported as climate
nance to the region in major global reports: the Climate Funds Update (CFU);
40
55 All CPEIR studies were
conducted in countries in
regions other than Latin
America and the Caribbean
56 UNFCCC SCF 2016
57 Climate Funds Update;
Barnard et al. 2016
58 Samaniego and Schneider
2015, 2016, 2017
59 ADB et al. 2014, 2015,
2016
60 Samaniego and Schneider
2017, p. 26; Information
from the Amazon Fund was
obtained directly from the
Banco Nacional do Desen-
volvimento (BNDES), due
to ‘signicant differences’
between the amounts
reported by this institution
and those reported by CFU
61 UNFCCC SCF 2016, informa-
tion for 2013 and 2014
62 Climate Funds Update
the Joint Reports on Multilateral Development Banks’ Climate Finance; the
Economic Commission for Latin America and the Caribbean (ECLAC) regional
reports on climate nance; and the United Nations Framework Convention
on Climate Change Standing Committee of Finance (UNFCCC SCF) Biennial
Assessment and Overview of Climate Finance (Biennial Assessment) reports. Each
of these reports analyzed data for 2013 and 2014 (2014 and 2015 in the case of the
MDBs) and provides information from different types of ows (see Table 5.1). This
information is either based on a specic set of nance providers or main funds
administrators (i.e. CFU on multilateral climate funds, the MDBs on ows through
global banks) or is the result of aggregating information from different sources,
including CFU and MDBs (i.e. ECLAC’s reports, Biennial Assessment reports).
Table 5.1 shows that some international organizations are making an
effort to capture, at least partially, information that comes directly from domestic
institutions in countries in Latin America and the Caribbean. For example,
the ECLAC reports include domestic ows that are administered by national
development banks in the region as well as other national sources; and the latest
Biennial Assessment captures national budget contributions to climate change
by including reports from country budget analysis – through Climate Public
Expenditures and Institutional Reviews (CPEIRS)
55 and GFLAC studies.
All these reports base their information on committed amounts, rather
than disbursements. This is a common practice that responds to the lack of
continued and reliable disbursement information for climate nance, in particular
from multilateral climate funds (with the exception of the Adaptation Fund).
The ECLAC reports do include disbursement ratios, but only for information
on national development banks. In addition, ECLAC uses disbursement data
reported by CFU and the robustness of this varies for each fund monitored.
In Table 5.1, we do not aim to compare the data as such, because the sources
included in each report differ. Nevertheless, some discrepancies are clearly evident:
although overall gures were expected to differ (given that the scope of analysis
of the reports varies in each case), discrepancies were found even when reports
were referring to the same type of ows. Table 5.2 displays further discrepancies by
showing how different reports give different estimates for how much the region has
received from multilateral climate funds and from multilateral development banks.
41
CLIMATE FINANCE
REPORTING MECHANISM
UNFCCC BIENNIAL
ASSESSMENT REPORT 56 CLIMATE FUNDS UPDATE 57 ECLAC REGIONAL REPORT
ON CLIMATE FINANCE 58
JOINT REPORTS
ON MDBS CLIMATE FINANCE 59
Tot al f und ing rep ort ed
for the region
Around US$ 0.51 billion
(2013 and 214)
US $0.970 billion
(2013 and 2014)
US$ 21,144,39 (2014)
US$ 19,776,08 (2013)
US$ 4.682 billion (2014)
US$ 3.737 billion (2015)
Reported ows for
Latin America and
the Caribbean
Collection of global ows:
· Bilateral Ofcial
Development Assistance
· CFU (only multilateral
funds)
· MDBs climate nance
· Domestic budgets
(from GFLAC reports
in 8 countries in Latin
America and the
Caribbean)
Projects approved by a set of
multilateral climate funds active
in the region:
·UNFCCC Funds
·GEF Trust Fu nd
·Adaptation Fund
·Green Climate Fund
· Special Climate
Change Fund
Other Funds:
· Climate Investment
Funds (i.e. Clean
Te ch n o l o g y F u n d ; Fo r e s t
Investment Program; Pilot
Programme for Climate
and Resilience; SREP)
·Amazon Fund
·ASAP
·GCCA
·FCPF
· Partnership for Market
Readiness
·UNREDD
· Bilateral funds (i.e.
Germany’s International
Climate Initiative, UK’s
International Climate
Fund)
Collection of ows from sources
active at regional level:
· CFU bilateral and
multilateral funds except
the Amazon Fund
·MDBs
· National Development
Banks (including BNDES’
Amazon Fund) 60
· Other national sources
Operations complying with
MDBs denition of climate
nance through MDBs in the
region (i.e. IDB and WBG)
·MDB own account
· MDB-managed external
resources
(e.g. Climate Investment
Funds)
Table 5.1
Climate finance reporting for Latin America and the Caribbean
According to the Biennial Assessment report, “about 23% of funding from
dedicated multilateral climate funds, 15% of climate-related nance reported to
the OECD DAC and 16% of the climate nance reported by MDBs go to Latin
America and the Caribbean”; this is around USD 0.51 billion.61 At the same time,
CFU reports a total of USD 0.97 billion for the same period 2013 and 2014. This
difference can be explained by various factors, including that CFU reports on
the total 23 funds that it monitors, 62 whereas the Biennial Assessment takes into
account the information on multilateral funds only.
In addition, some funds categorized by CFU as multilateral (because
they include pledges and deposits from multiple-country donors) are also part
42
UNFCCC BIENNIAL
ASSESSMENT REPORT 63 CLIMATE FUNDS UPDATE 64 ECLAC REGIONAL REPORT
ON CLIMATE FINANCE 65
JOINT REPORTS
ON MDBS CLIMATE FINANCE 66
YEAR FINANCE
FLO WS
TO LAC
OTHER INFORMATION FINANCE
FLO WS
TO LAC
OTHER INFORMATION FINANCE
FLO WS
TO LAC
OTHER INFORMATION FINANCE
FLO WS
TO LAC
OTHER INFORMATION
BILATERAL CLIMATE FINANCE
2013
2.235–
3.795
Adaptation 27%
Mitigation 53%
Cross-Cutting 20%
2014
2015
MULTILATERAL CLIMATE FUNDS
2013
0.506 0.970
Adaptation 22%
Mitigation 75%
Cross-Cutting 3%
Grants 66%
Concessional
Loans 33%
Disbursed 27%
0.151
2014 0.263
2015 0.302
Adaptation 34%
Mitigation 63%
Cross-Cutting 3%
Grants 63%
Concessional
Loans 23%
Other 14%
MULTILATERAL DEVELOPMENT BANKS
2013
2.528
8.846
2014 7.323 4.682 Adaptation 10%
Mitigation 90%
2015 7.835 3.737 Adaptation 28%
Mitigation 72%
Table 5.2
Characteristics of public finance for Latin America and the Caribbean (billion USD)
NOTE: Figures are intended to give a general overview of nance ows to LAC and may
not be directly comparable across reporters for reasons discussed elsewhere in this chapter.
All gures are directly reproduced or calculated using percentages from each source.
43
63 UNFCCC SCF 2016
64 Climate Funds Update
65 Samaniego and Schneider
2017
66 ADB et al. 2014, 2015,
2016
of bilateral ofcial development assistance reporting, as they are categorized
within the Creditor Reporting System (CRS) of the Organisation for Economic
Development and Co-operation (OECD) as bilateral contributions, e.g. funds from
the Forest Carbon Partnership Facility (FCPF) and the Global Climate Change
Alliance (GCCA), where each donor reports its own contribution. ECLAC, on the
other hand, reports that for the same period 2013 and 2014, USD 0.41 billion was
supported by multilateral climate funds.
Similarly, the Biennial Assessment reports that funding in 2013 and 2014
to Latin America and the Caribbean from MDBs reached USD 2.53 billion, but
the MDBs’ joint reports declare a funding stream of USD 4.68 billion for 2014
alone – an amount almost double that which the Biennial Assessment reports for
the two years together. At the same time, ECLAC reports that in 2013 and 2014,
USD 16.17 billion was provided through multilateral development banks. All this
shows that different sources provide different gures, even for the same funding
categories, which makes the data highly complex.
In addition to the causes signaled above, differences in funding gures may
also arise because of the use of different time-lines (i.e. calendar year, scal year), and
the use of different denitions for what can count as climate nance. All of this can
also result in double-counting (overestimation) or underestimation of nance ows.
As a result, the value of harmonized climate nance information has been
increasingly recognized in recent years, and has already begun to spur efforts from
the international community. Harmonization efforts include the agreement on
common principles for climate mitigation nance tracking made in 2015 by the
International Development Finance Club and the multilateral development banks
where the members agree on which categories and activities to include, and how to
report on these as nancial efforts to mitigate for the effects of climate change.
In addition, the Paris Agreement encourages the development of robust
monitoring, reporting and verication systems for climate nance. In this case,
pressure is mainly directed toward developed countries when reporting on their
support efforts to their developing country counterparts (see Box 5.1).
In order to generate more harmonized information, and more accurate
estimates, resources may need to be allocated to support a robust climate nance
tracking process. Ideally, this should have a ‘composite’ perspective, including
reporting not only from donors (top-down), but also from recipient countries
and institutions (bottom-up) to enforce mutual transparency and accountability.
Accurate climate nance information is critical to support decision-making at both
the international and national level, so that relevant actors can recognize where
there are gaps in nance provision, and effectively target their efforts to make
up for these shortfalls.
44
67 UNFCCC 2015
68 GFLAC 2015
69 GFLAC 2014
Reporting Climate Finance from Latin American
Countries’ Perspectives
To overcome some of the challenges of tracking climate nance when relying
only on donor-based information, GFLAC developed a methodology
69 to collect
information on public climate nance ows, from a donor perspective (top-down)
as well as from the national perspective (bottom-up). This methodology includes
synergies to identify top-down reporting based on OECD members’ reports to the
OECD DAC’s CRS, and the Joint Reports on MDB’s Climate Finance. For the
bottom-up information, a framework was developed to identify climate-relevant
sectors and actions in the context of each individual country. Box 5.2 shows the
methodology framework.
The methodology was then applied in Argentina, Chile, Ecuador, and Peru
in 2014, followed by Bolivia, Nicaragua, Honduras, and Guatemala in 2015. One of
the main differences of looking into climate nance from a country rather than an
international perspective is that the emphasis is on the identication of received
funds, rather than on allocations only.
Table 5.3 shows some characteristics of the funding, including total funding
received, instruments used, and the adaptation and mitigation divide. Most of the
Box 5.1
Monitoring, reporting, and verification for climate finance
recipients under the Paris Agreement
The development of robust monitoring, reporting, and verication systems for
climate nance was conceived as the responsibility of donor countries. The Paris
Agreement, through its articles 9 on nance and 13 on transparency, requires
donor parties and encourages “other [donor] parties” to report their nancial
provisions to developing countries.67
Recipient country reporting is also mentioned in Article 13, paragraph 10:
“Developing country Parties should provide information on nancial, technology
transfer, and capacity-building support needed and received under Articles
9, 10, and 11”. But this paragraph contrasts with much of the other language
associated with donor reporting: it states that parties “should” report information,
as opposed to the stronger “shall.” This choice of words reduces the incentive for
recipient countries to report on their climate nancing operations.
Nevertheless, a growing number of countries are starting to identify the
advantages of using these systems for their climate actions. In Latin America,
Chile, Colombia, and Peru have included the creation of MRV systems for
climate nance as part of their own contributions or nationally determined
contributions.68 In particular, Colombia is developing a digital platform to access
climate nance information, including information about public, private, national,
and international climate ows. Other countries in the region working towards
the design of MRV systems on climate nance are Costa Rica and El Salvador.
45
70 Mainly through national
efforts to reduce emissions
from deforestation and
forest degradation (REDD+)
efforts
71 GFLAC 2014
Box 5.2
e Climate Finance Group for Latin America and the Caribbean’s methodology—
a five-step framework:
The methodology ap plies a ve-step framework:
1) Analysis of international commitments under the UNFCCC, levels of progress
in reporting schemes such as national communications, and the inclusion of
nancial information within those documents.
2) Mapping of international climate nance, including bilateral and multilateral
sources. This mapping includes the identication of funding received (as
opposed to only allocated) and actors involved in managing the funds, as well
as their accountability processes at country level.
3) Analysis of climate-relevant policy at country level.
4) Analysis of national budget expenditures to identify budget allocations
addressing climate change. This process includes an assessment of
transparency, accountability, and social participation mechanisms in place.
5) Development of recommendations for the monitoring, reporting, and
verication of national and international climate nancing.
Source: Handbook for the analysis of international nancing and public budgets
in the eld of climate change in Latin America and the Caribbean.71
funds in the region have been accessed through loans – with smaller economies
receiving a greater proportion of grants compared to loans (with the exception of
Guatemala) – and for a balanced distribution of adaptation, mitigation and cross-
cutting
70 activities.
Challenges in mapping international climate nance to Latin America and the
Caribbean at country level included: a lack of harmonized criteria to dene
what constitutes a climate change project or action from different donors; a
lack of harmonized reporting modalities for ows of nance between donors
and recipients; incomplete and out-of-date information; and a lack of systems to
monitor climate nance on a regular basis at recipient-country level. The analysis
also found that countries do not have systematic information on the status of
project implementation, greenhouse gas emissions or vulnerability to climate
change baseline or evaluation data. This limits the capacity of countries to make a
useful assessment of the effectiveness of the funds used.
When looking into national budget expenditures, GFLAC identied that
while all countries have increased the amount of climate-related expenditure,
the proportion of climate-related spending in the national budget sometimes
decreased. In general, while these trends vary by country, the amount of money
dedicated to climate change is still very small and limited (see Table 5.4).
One of the challenges identied for the countries analyzed is that, in some
cases, it is not possible to match the international nancial ows received through
public expenditure to climate-related projects on the ground. This is because while
46
72 GFLAC´s country reports
in Argentina, Bolivia, Chile,
Ecuador, Guatemala, Hon-
duras, Nicaragua, and Peru
(Aguilar and Scardamaglia
2014; Hernández 2014;
Huamani Mujica 2015;
Mairena Arauz et al. 2015;
Paz 2015; Peláez Jara and
Herrera 2014; Pineda et al.
2015; Torselli and Morataya
2015)
COUNTRY PERIOD AMOUNT
RECEIVED
LOANS GRANTS ADAPTATION MITIGATION OTHER
Argentina 2010–14 283 164 118 127 66 90
Bolivia 2010–14 318 261 652
Chile 2010–14 304 203 101 15 287
Ecuador 2010–14 2,187 1,959 228 362 830 1,030
Guatemala 2010–15 338 237 101 38 30 268
Honduras 2010–15 227 79 148 62 91 74
Nicaragua 2010–15 322 131 192
Peru 2010–13 1,554 1,159 396 498 761 296
Total 5,569 3,929 1,284 1,363 2,071 1,810
75.36% 24.63% 25.9% 39.5% 34.5%
Table 5.3
International climate finance flows in eight Latin American countries (in million USD) 72
47
73 GFLAC´s country reports
in Argentina, Bolivia, Chile,
Guatemala, Honduras, Nic-
aragua, and Peru (Aguilar
and Scardamaglia 2014;
Hernández 2014; Huamani
Mujica 2015; Mairena Arauz
et al. 2015; Paz 2015;
Pineda et al. 2015; Torselli
and Morataya 2015); This
does not include the case
of Ecuador because it was
not possible to analyze
public expenditure due to
a lack public access to the
relevant data
COUNTRY YEAR CLIMATE EXPENDITURE
(MILLION USD)
% OF THE TOTAL NATIONAL
BUDGET
Argentina
2013 132 0.12%
2014 119 0.11%
2015 81 0.06%
2016 139 0.09%
Bolivia
2014 252 0.89%
2015 258 0.80%
Chile
2013 16 0.03%
2014 21 0.04%
Guatemala
2014 191 2.45%
2015 233 2.94%
Honduras
2014 174 1.89%
2015 184 2.15%
Nicaragua
2014 23 1.04%
2015 26 1.13%
Peru
2013 82 0.22%
2014 112 0.28%
Table 5.4
National public expenditure related to climate change in Latin America (seven countries)73
48
74 Guzmán, Guillén, and Man-
da 2017
resources are earmarked as climate-related at the international level, once they
reached a specic country, they may not be labeled or tagged for climate projects.
Another explanation is the current focus for mainstreaming climate change into
policy, which is also difcult to track within national budget systems. These factors
can result in an underestimation of actual climate change-related expenditure.
Another challenge appears when the aggregation of budget information does not
allow for the identication of specic activities, and therefore their relationship
with climate change.
Improving the monitoring of climate ows at the national level will require
the greater involvement of diverse government actors, including local governments,
implementers of climate change programs and projects, and other non-govern-
mental actors. Multi-stakeholder and multi-level governance is necessary to move
toward the construction and effective implementation of a national nancing ar-
chitecture that meets the needs of decision-makers in Latin American and
the Caribbean.
Recommendations for Climate Finance Reporting Systems
in Latin America and the Caribbean
GFLAC’s experience identied the lack of international guidance for climate
change monitoring as one the key challenges in achieving a comprehensive
understanding of the climate nance landscape. However, countries in
Latin America are starting to realize that having climate nance data and a
comprehensive understanding of climate nance ows received can allow them
to understand their own nancial needs. It can also help them comply with their
reporting responsibilities for national contributions and commitments under
the Paris Agreement, as well as aid better identication of nancial gaps
and opportunities.
Based on analysis carried out in the region in 2014 and 2015 and recent
studies carried out in other developing countries in Asia and Africa,74 GFLAC
recommends that Latin American and Caribbean countries establish institutional
frameworks for monitoring and assessing climate nance, including public, private,
national, and international resources. These frameworks should include specic
guidance on measuring and classifying nance ows (including guidance on what
is considered adaptation and mitigation), but in a way that is applicable for and
compatible with current national public nance systems. Such changes will require
investment in building capacity and developing incentives for implementing
agencies and actors involved in reporting on the ows of climate nance.
GFLAC has also identied recommendations for international climate
nance governing institutions, including the Subsidiary Body of Scientic and
Technological Advice and the Standing Committee on Finance under the United
Nations Framework Convention on Climate Change. Recommendations include:
to provide guidance on accounting modalities for climate nance (such as which
sectors and activities should and should not count as climate nance); to provide
guidance on the type of instruments that can be considered; and to highlight the
49
importance of disclosing nance ows disbursed – not just committed – for the
accountability of global climate nance as a whole. Finally, we recommend that
this guidance should be provided not just to donor countries, but also to recipient
countries, so that the latter can verify information shared by the former.
Transparency from the Other Side:
A Review of the First Biennial
Update Reports
75
Chapter 6
Romain Weikmans
Free University of Brussels, Belgium
51
75 An earlier version of this
text appeared in Weikmans,
R. (2017). Support needed
and received by non-Annex
I Parties: What can we
learn from their Biennial
Update Reports? KLIMOS
Policy Brief #8. Brussels:
KLIMOS-ACROPOLIS
76 See AdaptationWatch
2015, 2016
77 UNFCCC 2011, Decision 2/
CP.17, paragraphs 12–22
Introduction
How much climate nance has each developing country received? As basic as
this question may seem, we currently do not have any satisfactory answers to it.
This is a problem for several reasons. In addition to eroding trust in international
negotiations on climate change, the current lack of data means that it is impossible
to meaningfully identify any gaps in international support for climate actions
and where those gaps are, in terms of geographic (country and region), thematic
(mitigation, adaptation, etc.) or sectoral (agriculture, health, energy, etc.)
allocations. It also means that assessing the extent to which climate nance helps
developing countries address mitigation and adaptation challenges in an equitable
and efcient manner is extremely complicated.
As the Paris Agreement requirements on climate nance, reporting, and
transparency, are elaborated and come into effect, it will be critical to reverse this
trend of inadequate reporting. The success of the Agreement rests on assurance
through assessments and peer accountability on the efforts being made on
adaptation. Effective adaptation programs and nancing of these programs are
particularly important in non-Annex I countries, and thus there is a heightened
need for reports on climate nance received to be both comprehensive and
accurate. Without such gures, it is impossible to know how much progress has
been made under the Paris Agreement.
In this chapter we ask: why is it currently impossible to know how much
climate nance each developing country has received and what can be done
to change this situation? Many elements that impede the emergence of a clear
picture of the international climate nance landscape have already been described
in previous AdaptationWatch reports.76 In this chapter we go one step further,
and try to understand whether or not the blurry image of climate nance received
can be claried by recognizing a lack of compliance of developing countries
toward transparency requirements agreed under the United Nations Framework
Convention on Climate Change (UNFCCC). We show that lack of compliance is
not the only reason for concern; inadequate transparency requirements set out
under the UNFCCC are also to blame. We conclude by asking several questions:
“What are the most important challenges that need to be addressed?” and “Will the
Paris ‘enhanced transparency framework’ help address these challenges?”
Non-Annex I Parties’ Compliance Toward
UNFCCC Transparency Guidelines
In accordance with the decisions adopted in 2011 in Durban, non-Annex I Parties
are expected to submit Biennial Update Reports (BURs) containing, among other
things, information on support needed and received.77 The Conference of Parties
decided that non-Annex I Parties, consistent with their capabilities and the level
of support provided for reporting, should submit their rst BUR by December
2014. Subsequent BURs must be submitted every two years, either as a summary
in Parties’ National Communications or as a stand-alone update report. However,
52
78 Ellis and Moarif 2015, Gupta
and van Asselt 2017
79 UNFCCC 2013
80 The guidelines that have to be
followed by BURs in terms of
the information to be provided
on support needed and received
are contained in UNFCCC (2011,
Annex III of Decision 2/CP.17,
paragraphs 14–16): “§14.
Non-Annex I Parties should
provide updated information
on constraints and gaps, and
related nancial, technical and
capacity-building needs. §15.
Non-Annex I Parties should also
provide updated information on
nancial resources, technology
transfer, capacity-building and
technical support received from
the Global Environment Facility,
Parties included in Annex II to
the Convention and other devel-
oped country Parties, the Green
Climate Fund and multilateral
institutions for activities relating
to climate change, including for
the preparation of the current
biennial update report. §16.
With regard to the development
and transfer of technology,
non-Annex I Parties should pro-
vide information on technology
needs, which must be nationally
determined, and on technology
support received”
81 http://unfccc.int/national_re-
ports/non-annex_i_parties/ica/
technical_analysis_of_burs/
items/10054.php
82 By contrast, a ‘Common Tabular
Format – CTF’ has to be used
by Annex II Parties in their
reporting of information to the
UNFCCC Secretariat on climate
nance provided
83 UNFCCC SCF 2016
84 Author’s review of summary
reports of the technical analysis
of each BUR; NOTE: ✓: Yes; ×:
No; ✓/×: Partly. The total score
of each Party is calculated by
adding up the score obtained
in each column (✓= 1; ×= 0;
✓/×= 0.5). The non-Annex I
Parties included in this table are
those for which a report of the
technical analysis of their BUR
was available on the UNFCCC
website as of 8 July 2017. The
following non-Annex I Parties are
those that submitted a BUR that
had not yet been considered for
a technical analysis as of 8 July
2017: Ecuador, Georgia, and
Jamaica (for their rst BUR);
Bosnia and Herzegovina, Brazil,
Chile, Namibia, Singapore, and
Tunisia (for their second BUR)
Least Developed Countries (LDCs) and Small Island Developing States (SIDS)
may submit their BURs at their discretion.
Only ten (out of 154) non-Annex I Parties had submitted their rst BUR by
December 2014. As of 30 July 2017—more than two years after the 2014 deadline
– only 37 non-Annex I Parties had submitted their rst BUR. Why so few? These
gures support reports that non-Annex I Parties are confronted with a variety
of challenges in their reporting to the UNFCCC Secretariat.78 These challenges
may be related to capacity constraints, including a lack of established domestic
reporting systems. They may also be linked to an insufciency in international
support provided to help non-Annex I Parties in their reporting. The absence or
delay in reporting may also be explained by a lack of political willingness to report
on climate nance needed and received.
To e x pl o r e t hi s i s s ue , we l oo k a t t h e B UR s th a t h av e be e n s ub m i tt e d. We
investigate the extent to which those non-Annex I Parties that have submitted
at least their rst BUR comply with BUR guidelines. What follows is a review of
the technical analysis report of each non-Annex I BUR. Technical analyses are
conducted by international teams of technical experts in accordance with the
modalities and procedures contained in the annex to Decision 20/CP.19.79 This
technical analysis aims solely to identify the extent to which the information on
support needed and received that is supposed to be reported
80 by non-Annex I
Parties is included in these Parties’ BURs. The results of these technical analyses
are then presented in summary reports, made available online.81
The results of our review are presented in Table 6.1. The 32 non-Annex
I Parties included in this table are those for which a technical analysis of their
rst BUR was available as of 8 July 2017. Our results show a concerning picture,
where only two non-Annex I Parties fully comply with UNFCCC transparency
requirements on support needed and received. Ten Parties actually score less than
half of the maximum score possible. Therefore, the blurry image that we currently
have of the landscape of climate nance needed and received is not only due to
the failures of some non-Annex I Parties to report to the UNFCCC in a timely
manner; it is also the result of a lack of compliance of some non-Annex I Parties
in following UNFCCC transparency guidelines.
Reporting Approaches Used by Non-Annex I Parties
for Climate Finance Received
The lack of compliance of some non-Annex I Parties with UNFCCC transparency
requirements identied here is not the only element that impedes the emergence
of a clear picture of climate nance received. The weakness of UNFCCC
guidelines for reporting on climate nance received is also to blame. There is
currently no common format for reporting information on nancial support
received,82 nor is there a common methodology to assess this nancial support.
The result of this lack of specic guidance is that Parties decide what to report on
an individual basis, as is clear from their rst BURs. For example, the time periods
over which nance is reported as received varies widely.83
53
Table 6.1
Non-Annex I Parties’ compliance toward climate finance transparency requirements84
RANK NON-ANNEX I PARTY BUR1
SUBMITTED BY
DECEMBER 2014
EXTENT TO WHICH THE ELEMENTS OF INFORMATION ARE INCLUDED TOTAL SCORE
Constraints
and gaps
Related
nancial,
technical and
capacity-
building needs
Financial
resources,
technolog y
transfer,
capacity-
building and
technical
support
received
Technology
needs, which
must be
nationally
determined
Tec hnol ogy
support
received
1Namibia P P P P P P 6
1South Africa P P P P P P 6
3Viet Nam P P P P P P/ ×5.5
4Andorra P×P P P P P
4Armenia ×P P P P P 5
4Chile PP P P ×P5
4Ghana ×P P P P P 5
4India ×P P P P P 5
4Moldova ×P P P P P 5
4Thailand ×P P P P P 5
11 Azerbaijan ×P P P/ ×P P 4.5
11 Brazil P P P P/ ×P/ ×P/ ×4.5
11 Colombia ×P P P P P/ ×4.5
14 Argentina ×P P P P ×4
14 Indonesia ×PPP P/ ×P/ ×4
14 Tunisia P×P/ ×P/ ×P P 4
17 Bosnia and Herzegovina ×PPP/ ××P3.5
17 Lebanon ×P P/ ×P P/ ×P/ ×3.5
17 Mexico ×P P/ ×PP×3.5
17 Montenegro ×P P/ ×PP×3.5
17 Serbia ×P P P/ ×P×3.5
17 Uruguay ×P/ ×P/ ×P P/ ×P3.5
54
RANK NON-ANNEX I PARTY BUR1
SUBMITTED BY
DECEMBER 2014
EXTENT TO WHICH THE ELEMENTS OF INFORMATION ARE INCLUDED TOTAL SCORE
Constraints
and gaps
Related
nancial,
technical and
capacity-
building needs
Financial
resources,
technolog y
transfer,
capacity-
building and
technical
support
received
Technology
needs, which
must be
nationally
determined
Tec hnol ogy
support
received
23 Paraguay ×PPP× × 3
23 Peru P×P/ ×P×P/ ×3
25 Costa Rica ×P P/ ×P× × 2.5
25 Malaysia ×P P/ ×P× × 2.5
27 Israel × × × P×P2
28 Macedonia
(F. Y. R. of)
×P P/ ×P/ ×× × 2
29 Mauritania × × PP/ ×× × 1.5
30 Korea (R. o f) P××××× 1
30 Morocco × × P/ ×P/ ×× × 1
30 Singapore P××××× 1
Additionally, as depicted in Table 6.2, we can see that nance was reported in
four separate ways in the countries assessed; while most reported per project/
activity or per donor, one country reported per thematic area, and another gave
only headline gures. Another disparity included whether nance was designated
according to thematic sectors (such as mitigation or adaptation), economic
sectors (such as energy or agriculture), both, or neither. As is clear from these
inconsistencies, countries have taken license to report as they desire. This creates
barriers in comparing reports across countries and in developing a comprehensive
view of nance received by these countries.
In addition, the UNFCCC guidelines do not require reporting of the
underlying assumptions, denitions and methodologies used in generating
information on climate nance received.85 As ob serve d by the U NFCCC SCF,86
countries often use different denitions of climate nance, and of adaptation
and mitigation activities. This means that it is extremely difcult to meaningfully
compare the amount of climate nance received by each non-Annex I Party.
In addition to the problem of partial and/or opaque reporting, the multiple
accounting approaches used by Annex I
87 and non-Annex I Parties make it
Table 6.1 (continued)
85 UNFCCC SCF 2016, p. 31
86 UNFCCC SCF 2016, p. 91
87 See AdaptationWatch 2016
88 Weikmans and Roberts
Forthcoming; Data
extracted from UNFCCC
SCF 2016, pp. 32–33
and 103–105; NOTE: i
E.g., energy, transport,
agriculture; ii Received
or approved. Parties are
shown in alphabetical order.
The 20 non-Annex I Parties
included in this table are
those that had submitted
their BURs as of 30 June
2016 and that provided
summary information on
nancial support received
during a certain period of
time. In total, 32 non-Annex
I Parties had submitted
their BURs by 30 June
2016. Twelve of these 32
55
Non-Annex I Party
REPORTED IN
TABULAR FORMAT
ALLOCATION CHANNELS SECTORS FINANCIAL INSTRUMENTS OTHER
PER PROJECT
PER DONOR
PER THEMATIC AREA
ONLY HEADLINE FIGURES
TOP DONORS
BILATERAL
MULTILATERAL
MULTILATERAL FINANCIAL INSTITUTIONS
MULTILATERAL CLIMATE CHANGE FUNDS
SPECIALIZED UNITED NATIONS BODIES
GEF
PRIVATE FOUNDATIONS
PRIVATE SECTOR
MITIGATION/ADAPTATION
ECONOMIC
GRANT
CONCESSIONAL LOAN
LOAN
NATIONAL BUDGET
RESULT-BASED PAYMENT
LEASING
ODA/NON-ODA
STATUS OF FINANCE
DOMESTIC FINANCE FLOWS
CO- FINANCING
Argentina P P P P
Armenia P P P P P
Brazil P P P P
Chile P P P P P P P P
Colombia P P P P P P
Ghana P P P P P P P P P PPP P P
Indonesia P P P P P P P P
Lebanon P P P P P
Malaysia P P PPP
Mauritania P P P P P P P P
Mexico P PPP P
Montenegro P P P P P P
Morocco P P PPP P P P P
Paraguay P P P P P P
Peru P P P P P P P P P
Moldova (R. of) P P PPP PPP P
South Africa P P P P P P P P P P
Thailand P P P P P
Tunisia P P P P P
Viet Nam P P P
Table 6.2
Reporting approaches used by some non-Annex I Parties for financial support received 88
56
non-Annex I Parties do not
appear in this table because
they indicated nancial
support received only for
some projects, activities,
sectors, or donors, or did
not include quantitative
nancial information at all
in their BURs
89 UNFCCC 2015, Decision
1/CP.21, Article 13.10,
paragraph 90
90 van Asselt et al. 2017
91 UNFCCC 2015, Decision 1/
CP.21, paragraph 57
92 van Asselt et al. 2017
impossible to compare the total support provided and received. These problems
are further exacerbated by the absence of project-level data that underlie Annex I
and non-Annex I Parties’ reports, which makes it extremely difcult to understand
what types of projects and programs are being supported, and how this support is
being provided.
Conclusion: Main Challenges and Opportunities Ahead
There are at least two challenges that need to be addressed in order for a clear
picture to emerge of international climate nance needed and received.
First, as described above, few non-Annex I Parties have submitted their
rst BUR. Frequent reporting by non-Annex I Parties is the rst condition that
would permit a comprehensive picture of the landscape of climate nance needed
and received to emerge. There is a pressing need to understand why so many
non-Annex I Parties have not yet submitted their rst BUR to the Convention
Secretariat. Similarly, we need to understand why some countries fail to comply
with the UNFCCC guidelines that are in place when preparing their BURs. If the
main reasons are linked to capacity constraints, more international support should
aim to build capacities to track and report the support needed and received. If
reporting is hampered by a lack of political willingness, incentives to report in a
timely manner should be identied and promoted.
Moreover, under the Paris ‘enhanced transparency framework’, LDCs and
SIDS are still allowed to submit their BURs “at their discretion”.89 Through this
provision is necessary to protect these countries from overwhelming reporting
duties, such discretionary reporting can impede the emergence of a comprehensive
picture of the international climate nance landscape.90
A second challenge identied in this chapter is a lack of specic guidelines
on how to account for and report on climate nance needed and received. This has
given rise to a plethora of approaches used by non-Annex I Parties, and makes it
impossible to compare across countries the information that is reported. The Paris
enhanced transparency framework aims at dealing with the issue of accounting
modalities for climate nance provided and mobilized.91 However, the accounting
modalities that are currently being negotiated in this regard will not apply to
accounting for climate nance needed and received.92 This is a gap that deserves
immediate attention: for a comprehensive transparency framework to emerge,
it will be necessary to develop common accounting modalities that apply in all
contexts for reporting on climate nance.
As the Paris Agreement depends on accurate tracking of action and
support, and continuous assessment and reassessment, it is increasingly urgent
that reporting is carried out in a way that is transparent, uniform, and thorough.
Non-Annex I countries have a crucial role to play in this process: they will both
afrm that the nance claimed to be given by Annex I Parties has been received,
and indicate whether this fullls their needs. With clear and comprehensive
reporting, the UNFCCC will be better able to improve mechanisms for funding
and allocation of funds, thereby enhancing global efforts to mitigate and adapt to
climate change.
57
Chapter 7
Mizan Khan
North South University, Bangladesh
Capacity Building for Climate
Change Adaptation: Lessons from
Other International Regimes
58
93 Hass et al. 1993
94 Kuhl 2009; Keijzer 2013
Although the challenge of climate change is universal, capacity to adapt to the
phenomenon and cope with its impacts is not. Many of the world’s developing
countries have extremely limited scope to plan and implement adequate climate
policies and actions. As the enabler for the implementation of responses to
climate change, capacity building takes on central importance. This is especially
true for the least developed countries (LDCs) and the small island developing
states (SIDS), which are hit rst and hardest by climate change, but have the least
capacity to adapt.
The Paris Agreement’s capacity building provisions, including: the
decision to establish a Paris Committee on Capacity Building (PCCB) (Article 11);
a Capacity Building Initiative for Transparency (CBIT) (Article 13); and the
promotion of education, training, and public awareness (Article 12) can therefore
be regarded as foundational for all other institutions, mechanisms and processes
under the United Nations Framework Convention on Climate Change.
However, capacity building as an element of development and
environmental cooperation has been taking place under many different names
and forms for more than half a century. These efforts have been carried out under
a diverse set of global regimes that have emerged during the last several decades.
Five categories of global regimes are highlighted here.
The rst regime type relates to development issues, such as economic
growth, poverty reduction, and sustainable development, which involve different
kinds of assistance from bilateral and multilateral agencies. Trade and regional
economic integration represents a second set of regimes with distinct objectives
and regulatory instruments. A third category pertains to the protection of the
environment and natural resources – that is taking care of brown and green issues.
A fourth category covers international human rights frameworks with an array of
covenants and declarations. Finally, a fth category applies to security, cooperation,
and humanitarian affairs. While there are thematic overlaps among all these
regimes, each of them represents specic constituencies, and possesses its own
normative and conceptual frameworks, procedures, institutions, and approaches.
Understanding and reconciling these multiple types of regimes and their
relevance to national and international development presents considerable
challenges. Research on international institutions identies capacity as one of
three conditions for institutional effectiveness; the other two are sufcient concern
from nation-states and nding solutions applicable to the identied problems.93
Under each of the regime categories mentioned above, different kinds of
capacity building activities have been undertaken with donor support in developing
countries. Both generic and regime-specic capacities have been addressed through
the technical cooperation programs of rich industrial countries.94 This chapter
highlights the major ndings from a review of capacity building initiatives under
different regimes including the World Trade Organization, the Regional Seas
Programme, the international human rights regime, disaster-risk reduction, and the
Montreal Protocol on Substances that Deplete the Ozone Layer. The purpose of
this exercise is to look at similarities and differences in the various approaches to
capacity building, and to learn lessons for charting a realistic course for capacity
building to enable adaptation to climate change.
59
95 World Bank 2005; UNDP
1996; OECD 2006
96 Vandeveer 1999
97 Luken and Grof 2006
The methodology of this review was primarily focused on a content analysis of
the extremely limited literature: unfortunately, there is a dearth of peer-reviewed
literature on capacity building. We gathered data from development agency
reports on capacity-building activities and analyzed specic characteristics. These
included: the type of capacity building undertaken; the focus of the activities; who
was leading activities; who was funding activities; whether activities were foreign-
consultancy driven; whether activities were demand- or supply-driven; the extent
to which recipient countries owned activities; and whether a system for continued
capacity building was in place in recipient countries once the work had concluded.
Regime Experiences: Commonalities and Dierences
This brief review is a summary of experiences of past and ongoing capacity-
building efforts under ve different global regimes, undertaken through the
technical cooperation programs of donor agencies. The regimes are: (1) trade
capacity building; (2) capacity building under the Regional Seas Programme
(RSP); (3) capacity building for integrating human rights into development; (4)
capacity building for disaster-risk management; and (5) capacity building for the
phase-out of ozone-depleting substances under the Montreal Protocol.
The review shows that there are numerous commonalities, and very few
differences, in the approaches and tools these regimes use in capacity building.
The prim ary ndin gs ar e hig hligh ted below :
·Institutional development and its strengthening is a focus of capacity building
in all regimes.95 Where this aspect was weak, the regime did not function
effectively. One example is the Mediterranean RSP, where there was a wide
diversity of state regimes and value systems, different levels of development,
and political instability in some states. Public-sector capacity could therefore
not reach the critical mass required for the RSP to function effectively. On the
other hand, the Baltic Sea Programme was successful because a compatibility of
state regimes and value systems contributed to stronger and effective capacity
building.96 Likewise, institutional capacity building has been more successful
under the Montreal Protocol, with its detailed program and implementation
plans, both at national and international levels.97
·Education, training, and research aimed at developing human resources
and improving professional competence on a sustainable basis is also key to
building national capacity. This was evident in all the regimes, with a lesser
focus on education and a greater focus on training and awareness-raising in
the regime for phasing out ozone-depleting substances. The regimes on trade,
human rights, and disaster-risk management particularly focused on formal and
professional education at different levels including the development of research
and analytical capacities.
·Strong nancial support behind capacity building efforts under regimes
for trade capacity building and phasing out ozone-depleting substances
contributed greatly to effective compliance by member nations with the regime
requirements. Recipients of aid for technical cooperation under these two
60
regimes were also able to build the foundations necessary for developing their
own capacities. Such adequate nancial support was made available by donor
countries because of their direct interest in building capacity in developing
countries. In addition, promotion of trade capacity and the phasing out of
ozone-depleting substances promoted both direct and indirect economic and
health benets not only in industrial countries, but also in developing countries.
In the case of the human rights regime, this impact was also true to some extent
because of its contribution to enhancing aid effectiveness. However, responses
from developing countries were not the same across the board. Still, nancial
constraints for capacity building in the regimes of human rights, disaster-risk
management, and RSP in the Mediterranean continue to inhibit effective
capacity building.
·National ownership of capacity building efforts is another key contributor to
sustained progress. For example, aid-recipient countries that had direct interests
in capacity building under the trade and ozone regimes had stronger ownership
of such efforts than they did under other regimes where they did not have direct
interests. Therefore, in areas where there are mutual interests between donors
and recipients, capacity building efforts have greater success. Additionally,
where aid projects are donor driven, as is often the case, the ownership of a
recipient country usually does not grow.
·Networking, partnerships and sharing of experiences have contributed to
capacity building in all the regimes. As donors and recipients share best
practices within and across categories, the ability of any program to build
capacity is enhanced.
·Web-based tools have also contributed to capacity building under human-rights
and disaster risk management or reduction regimes. For example, Mexico
has developed a web-based tool to sensitize citizens about human rights;
other countries are now replicating this tool. Another web-based tool, the
Hyogo Framework of Action monitor in disaster risk reduction, contributes
by providing a platform for uploading information on disasters and their
associated losses. This allows for the aggregation and consolidation of disaster-
related data across the globe.
·Capacity substitution at the national level by external experts and consultants
can work against the building of in-house and in-country capacity. This was
most evident in the case of the disaster risk management or reduction regime,
where external experts played a strong role. To some extent, this inhibited the
utilization and further development of in-house and in-country capacity. Many
developing countries, such as Bangladesh, have developed a fair amount of
managerial and technical expertise in disaster risk management because of their
age-old experiences of living with natural and climate disasters. By depending
on outside experts rather than utilizing and enhancing in-country capacity, the
recipient country’s dependence on such external support is perpetuated, and
opportunities for capacity building are lost.
61
Lessons for Building Capacity to Adapt to Climate Change
The primary lesson from this analysis is that sustainable support at both the
national and international levels is critical for successful capacity building. This
means, most importantly, that support must be long-term. Additionally, donor
and recipient countries should work to establish common interests, with a special
emphasis on the national needs and interests of the recipients. It has been shown
that where countries take greater ownership of their capacity building, they
are able to enhance long-term effectiveness. Finally, capacity building is most
successful when there is education, training, and awareness-building at all levels
on human rights. This should be a priority focus of national and global efforts.
Although capacity building provisions are new in climate policy under the
Paris Agreement, other international regimes have set important precedents, from
which lessons on best practice can be drawn. Leaders in the climate regime must
now learn from this work to ensure that capacity-building efforts, particularly
those targeted for adaptation, are successful.
Danielle Falzon
Brown University, United States
Kevin M. Adam s
Stockholm Environment Institute, Sweden
Conclusion
63
This report has highlighted the experiences of developing countries and regions
in working to plan and implement measures for adapting to climate change. In
putting forward these perspectives, we have aimed to elucidate key issues from
adaptation experiences on the ground in order to inform future work and policy.
Outlined below are ten common themes that have emerged from the research
discussed in the previous chapters. These identify key issues regarding the
implementation of adaptation efforts, especially around nance, governance, and
capacity building. As developing countries are those which have the most at stake
in global adaptation efforts, these countries should take the themes below as action
items that need the most attention in order to make progress on adaptation under
the Paris Agreement.
1. Commit to an era of implementing adaptation efforts. For decades, the questions
of what can be done about adaptation and how might it be approached in
policy have been researched and debated. Now, with the coming into force
of the Paris Agreement, currently ratied by 168 countries, the time has come
to focus efforts on implementation. As countries are already beginning to
feel the effects of climate change, it is crucial that adaptation moves from
discussion into action.
2. Increase nance for adaptation. Under the GCF, funding is meant to be equal
for adaptation and mitigation, yet nance is still overwhelmingly focused
on mitigation. Though mitigation is crucial for addressing climate change,
adaptation is especially critical in developing countries where people face the
greatest risks and impacts. As a result of insufcient funding, the risks faced
by these countries persist unnecessarily. The longer these countries must wait
to implement costly adaptation measures, the greater the loss and damage
that will be experienced due to storms, droughts, and ooding. Closing the
adaptation nance gap should be a priority for funders.
3. Dene ‘adaptation’ in a way that is clear and widely accepted. Currently there
is no clear and common understanding of what qualies as an adaptation
project. This creates uncertainties in reporting, and conict in the provision
of adaptation nance. The difference between adaptation and development
in particular must be delineated, or alternatively the two concepts must be
dened together as interrelated. The Green Climate Fund debates over
applications from Bangladesh and Ethiopia, discussed in Chapter 3, is a perfect
example of how a lack of clear denitions in this area can inhibit adaptation
efforts. Furthermore, countries must know what should be counted as work
on adaptation when accounting and reporting under the Paris Agreement.
4. Outline a robust reporting system with universal methodologies for accounting.
As the analysis in Chapter 7 and past AdaptationWatch reports demonstrate,
there are many problems relating to the reporting of adaptation action and
support. What this report has shown is that these issues are not unique to
developed countries, and that developing countries are also failing to include
the necessary information, or even failing to report altogether.
64
As the success of the Paris Agreement lies in accurate reporting and
assessment, the development of clear reporting requirements and universally-
used methodologies is urgently needed. Furthermore, these standards must
not impose an undue burden on developing countries, and they should be
adequately supported in fullling their reporting duties.
5. Move toward substantive assessments of progress on adaptation. Currently, the
evaluation of adaptation efforts, and their progress, is focused primarily on
measurement and reporting according to predened goals and numerical
targets. As a more accurate alternative, progress should be measured in terms
of substantive improvements based on locally-dened needs that are evaluated
not only by numerical changes but also by qualitative, narrative testimonies.
Therefore, in dening monitoring and evaluation frameworks, an approach
that emphasizes not only reporting but also analysis of on-the-ground
outcomes is crucial.
6. Ensure that nance goes to the most vulnerable and under-supported. In decision-
making on adaptation nance, support should be targeted to the most
vulnerable and to those sectors that are least supported. Sector-based targeting
in particular should be based on nance data, allowing decision-makers to
distribute funds in a way that addresses the greatest needs rst and has the
most signicant impact. Additionally, funding should be targeted toward those
populations and sectors that can use it most effectively, in order that it should
have the greatest impact.
7. Consider in-country issues with communication and coordination. Not all nations
have the same in-country governance capacity to plan and implement
adaptation projects. This is especially true in developing countries, where
communication and coordination across ministries and sectors can create
insurmountable barriers to effectively approaching adaptation efforts. Thus,
in the provision of adaptation nance, and the planning of projects, it is
critical to take governance capacity into account. Moreover, improving these
connections may lead to a system of nationally provided climate nance. This
is not something that is typically imagined, but it could be benecial, in the
Latin American context for example.
8. Simplify and support efforts to increase climate nance readiness. It is currently
complicated for countries to apply, prepare for, and receive climate nance.
There are numerous actors and systems that must be in place in order for
a country to take advantage of current sources of climate nance, and this
situation may strain the resources of developing countries. Though many Latin
American and Caribbean countries have performed quite well with Green
Climate Fund Readiness program, there are still many others that lack this
experience. Importantly, however, making nancing systems less complicated
should not come at the expense of strict accountability for the effective use
of funds. In addition to simplifying the funding process and providing support,
decision-makers must also work to facilitate the establishment of numerous
65
national implementing agencies. This will result in the streamlining of access to
climate funds, and more effective governance and implementation when these
funds are received.
9. Co-design adaptation action with local communities. It is now well established
that many adaptation actions are most successful when they address a local
need and are context appropriate. This is most likely to be the case when
local communities are an integral part of the planning and implementation
processes, preferably as co-designers. In addition to increasing the probability
of success, this approach saves money by ensuring that funds are not wasted
in the rst place on projects that are maladaptive, and also eliminates the
need for additional projects to correct for mistakes made initially. Finally,
local communities are already implementing their own adaptation plans and
know best what is appropriate for their own geographical and cultural context;
utilizing this knowledge gives these communities ownership and understanding
of the adaptation process as a whole.
10. Reorient capacity-building efforts to focus on the long term. Currently, capacity
building is structured to depend on external experts entering a country to
provide training that briey enhances capacity, but leaves behind little ability
for those countries to continue building that same capacity on their own.
A long-term focus both effectively increases capacity overall, by building
in-country knowledge and ownership of capacity building, and reduces costs
by eliminating the need for repeated trips by non-native experts in and out
of the country. Furthermore, capacity-building efforts should be focused on
developing human rights and strengthening institutions, as this has proven
to be an effective long-term strategy under other international regimes.
66
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