kaplina undp climate finance in developing countries
TRANSCRIPT
Enabling Adaptation Finance in Developing Countries Catalyzing Adaptation Finance
Anna Kaplina Regional Adaptation Specialist, ECIS
Paris, June 2014
Cambodia/LDCF Georgia/AF
Hungary/SPA Laos/SCCF
Supporting the Vulnerable and Marginalized
Where are the main funding requirements for adaption likely to arise?
“Additional” Funding Needs $2.129 b (Urgent and Immediate Priorities -NAPAs) $30-100 b/year for period 2010-2050 (WDR 2010) $290 b/year (Parry et all 2009) $326 - $355 b/year for financing adaptation options on
natural ecosystems) (Source: Berry 2007) • Mainly infrastructure • Estimates are likely an underestimate!
Catalyzing Adaptation Finance
Present Level of Assistance Approx. USD $140-175b & $70-100 b/year for 2010-2050 (mainly for mitigation) Vertical Funds (for adaptation; LDCF/SCCF/AF): less than $1.0b to-date cumulatively
Copenhagen Accord- $100b/year additional finance by 2020 (50% of this for adaptation)
Estimated Losses: $15-20 billion (Swiss Re/Munich Re) $21 billion (prop. damage); $22 billion (opp. costs) (World Bank)
Catalyzing Adaptation Finance
Scale of Damage in Thailand (2011
Catalyzing Adaptation Finance: Key Drivers
Public finance alone is not currently sufficient; Public finance alone is not going to be sufficient
Most of the investment in adaptation expected by businesses and households (end-users). Facilitating private sector investment will be necessary: – Preserving existing infrastructure, businesses and livelihoods – Developing new businesses – No-regret investments (adaptation is an ancillary benefit)
Ensuring that money is well spent, and hence maximizing its impact and effectiveness will be critical to maintaining support and realizing the transition to a low-carbon, climate-resilient future.
Catalyzing Adaptation Finance
Key Barriers to Adaptation Finance Catalyzing Adaptation Finance
• Assess needs and priorities, and identify barriers to investment
• Identify policy mix and sources of financing
• Multiple access channels
• Blend and combine finance
• Formulate project, progamme, sector-wide approaches to access finance
• Implement and execute project, programme, sector-wide approaches
• Build local supply of expertise and skills
• Coordinate implementation
• Monitor, report, and verify flows of results and funding
• Performance-based payments
Financial Planning
Accessing Finance
Delivering Finance
Monitor, Report & Verify
Mainstreaming or earmarking funding for adaptation?
Ideally full mainstreaming, BUT:
• No appropriate M&E systems in place
• How to make sure that the most vulnerable would be targeted?
• Separate funding required for capacity building and enabling conditions
• Some countries /sectors prefer to have stand-alone adaptation strategies, plans, programmes
Catalyzing Adaptation Finance
How to adapt existing regulations and policy instruments
• Clarity of the legal framework is critical
• Technical capacity and knowledge of personnel in the various sectors is a major inhibitor to adoption of new technologies and approaches
• Cross sectoral approaches may help reduce the need for additional funding
Catalyzing Adaptation Finance
to the adaptation needs? Are there opportunities to reduce public spending and support resilience?
9
Focus of UNDP’s Work on Climate Finance Readiness Catalyzing Adaptation Finance
ACTION ON THE GROUND
CAPACITY ENHANCEMENT
BARRIER REMOVAL
POLICY DIALOGUE
• Policy development: How is CC policy formulated? Are national CC strategies developed?
• Provide a framework for sector-wide approaches & to incentivise private investments
• Institutional structures: What are roles & responsibilities of institutions involved in managing CC response & their interaction?
• Public financial management: How to quantify & track CC-related expenditures in the budget?
• Developing bankable adaptation projects including training on the economics of adaptation
NAP-GSP, LECB, CPEIR
LDCF/SCCF/AF/Bilateral financed projects
NAP-GSP, LECB, CPEIR, LDCF/SCCF/Bilateral financed projects
CPEIR
Economics of Adaptation
10
Partnerships – A Must! Catalyzing Adaptation Finance
ACTION ON THE GROUND
CAPACITY ENHANCEMENT
BARRIER REMOVAL
POLICY DIALOGUE
LDCF/SCCF/AF/Bilateral financed projects
NAP, Climate Readiness, Economics of Adaptation, Evidence Based Result Tracking
www.undp-alm.org