Our Burning Planet

ADAPTATION FINANCE

Big shortfall in climate funding needed by developing countries is ‘hugely worrying’ – UNEP

Big shortfall in climate funding needed by developing countries is ‘hugely worrying’ – UNEP
People wade through a flooded road after heavy rainfall caused severe floods in the coastal city of Beira, Sofala Province, central Mozambique, 14 February 2020. (Photo: EPA-EFE / Andre Catueira)

The funding developing countries need to deal with the present impacts of climate change (adaptation finance) is 50% bigger than previously thought, with Unep estimating the current adaptation finance gap is now $194bn – $366bn per year.

‘Even if the international community were to stop emitting all greenhouse gases today, climate disruption would take decades to dissipate,” according to Inger Andersen, Executive Director for the United Nations Environment Programme (Unep).

“So, I urge policymakers to take heed of the Adaptation Gap Report, step up finance and make COP28 the moment that the world committed fully to insulating low-income countries and disadvantaged groups from damaging climate impacts.” 

Andersen was referring to Unep’s annual Adaptation Gap Report released this week, ahead of the UN climate summit (COP28) taking place in Dubai at the end of this month.

Read last year’s report in Daily Maverick: Global climate adaptation failure puts world at risk, new UN report finds

While global heating is yet to surpass the “tipping point”, there are already climate impacts locked into place, and climate adaptation is about dealing with those.

 

“Adaptation is necessary because climate change is already happening,” Mandy Barnett of the SA National Biodiversity Institute (Sanbi) told Daily Maverick, “and people who didn’t cause it are bearing the brunt of it.”

Since 2014, Unep’s yearly adaptation gap reports have assessed global progress on adaptation planning, financing and implementation, and this year the report finds progress on adaptation is slowing across all three areas, when it should be rapidly accelerating. 

The report found that the gap between the finance developing countries need and what is actually coming in, is a lot bigger than previously calculated – at least 50% bigger than thought.

Unep said that the report has undertaken a major update and now estimates higher costs of adaptation than earlier studies, with modelling now estimating the costs of implementing domestic adaptation priorities at $387-billion per year for 2021 to 2030 and projected to rise significantly by 2050. 

This cost is 10-18 times bigger than what international public finance has put down – with adaptation finance flows to developing countries declining 15% in 2021, to around $21-billion.

“Considering that the finance needed to implement domestic adaptation plans in developing countries is currently estimated at $387-billion per year until 2030 – most of which will require international support to deliver – this is a hugely worrying deceleration,” said Andersen.

UNEP noted that this dip comes despite pledges made at COP26 in Glasgow to deliver around $40-billion per year in adaptation finance support by 2025, and sets a worrying precedent.

While this seems to be doom and gloom the benefit of this type of finance cannot be neglected. For instance, Unep highlighted that studies have indicated that every $1-billion invested in adaptation against coastal flooding leads to a $14-billion reduction in economic damages. 

If $16-billion was invested in agriculture every year, it would prevent about 78 million people from starving or experiencing chronic hunger because of climate impacts.

How to increase finance flows

Alongside the release of this report, Unep calls for the upcoming COP28 climate summit to deliver a new momentum on adaptation and loss and damage, emphasising that the loss and damage fund (agreed upon at last year’s climate summit, COP27) and ongoing discussions to establish a New Collective Quantified Goal on Climate Finance are important steps in the right direction. 

Read more in Daily Maverick: COP27 makes history with agreement on ‘loss and damage’ fund for vulnerable countries impacted by climate change

Other suggestions include:

  • Remittances;
  • Increasing and tailoring finance to small and medium enterprises;
  • Implementation of Article 2.1(c) of the Paris Agreement on shifting finance flows towards low-carbon and climate-resilient development pathways;
  • A reform of the global financial architecture, as proposed by the Bridgetown Initiative; and
  • Policymakers, multilateral banks, investors and the private sector must make COP28 the moment that the world commits fully to insulating low-income countries and disadvantaged groups, such as women and indigenous peoples, from climate impacts. DM

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