2 •
Countries with high actual and historic emissions as well as high capacity to meet the costs must bear the major responsibility for generating funds for adaptation. Developed countries must meet their responsibility to
cover additional adaptation financing needs in developing countries by leading on a series of domestic and international policy measures.
• Each country must take responsibility for preparing its national priorities and plans for adaptation, with
adequate financial and technical support. These plans should form the basis for obtaining funding for adaptation.
• To ensure that adaptation is effectively implemented, greater understanding and defining of adaptation, and
linking it closely with disaster risk reduction and sustainable development, is crucial. •
Developing countries accessing funds should ensure that the most vulnerable communities are at the centre of and benefit from their adaptation policies, and that these policies reflect the needs and interests of both women
and men. This is a key part of fulfilling commitments they have made to secure basic human rights of their citizens, such as the rights to food, health, water and shelter.
• Integrating climate risk management in existing national development plans and processes should be the main
approach for adaptation. Funding mechanisms to be developed under the post 2012 agreement should prioritise this approach over ‘stand alone’ funding and projects.
• Future international action on adaptation must strengthen the capacity of developing country governments,
sectors and civil society to understand adaptation needs, identify priorities and undertake adaptation actions, in order to contribute to national and local sustainable development.
2. S
CALING
-
UP OF EFFECTIVE ADAPTATION FUNDING
A broad consensus is emerging that the scale of funding needed for adaptation in developing countries will be tens of billions of US dollars annually.
2
The existing architecture of voluntary funding by developed countries and the actually existing instruments of the carbon markets, which currently are raising just a few millions
dollars for adaptation purposes, has not delivered sufficient resources so far, and is unlikely to do so in the future. Additional sources and mechanisms for raising the scale of funding needed must be a key element of a
post-2012 agreement. Building consensus and identifying workable solutions well before Copenhagen is urgently needed to ensure the financial mechanisms are in place when large-scale needs for adaptation funding
are presented. There are several broad categories of proposed alternatives to scale-up adaptation funding:
• Proposals linked to climate policies addressing greenhouse gas emissions and based on the ‘polluter pays
principle’. These can be either international or domestic levies or other mechanisms. International:
Auctioning of quotas of national emission budgets Assigned Amount Units International air travel levy
International bunker fuel andor international aviation fuel levy An Adaptation Fund levy to Joint Implementation and Emission Trading under the Kyoto Protocol
Domestic:
2
Different studies estimate the additional costs between 28-86bn annually by 2015-2030, depending on the precise definition of adaptation and which countries are included, see e.g. UNFCCC 2007: Investment and financial flows to
address climate change, UNDP 2007: Human Development Report, Oxfam 2007: Adapting to climate change. What is needed in poor countries and who is going to pay.
• Funding mechanisms under UNFCCC must overcome the failure of voluntary contributions,
through measurable, reportable and verifiable funding obligations linked to responsibility and capacity to pay
• Developing country governments have to ensure that most urgent underlying and growing
vulnerabilities are addressed in adaptation funding, targeted at most vulnerable communities •
All Parties should come forward with more concrete proposals to generate resources in post- 2012
3 Use of revenues from auctions of emission permits in domestic climate regulation
Carbon levy •
Risk sharing mechanisms through micro-insurance based ‘weather hedges’. Private insurance to aid disaster recovery is likely to remain too expensive for many poor communities but options to co-finance risk-sharing
instruments for most vulnerable people based on international polluter pays or capability concepts could be viable.
3
Key demands to generate the likely needed resources through a combination of funding instruments: •
A post-2012 agreement must include a more coherent and effective funding architecture which delivers adequate, sustainable and predictable resources for adaptation. These resources must be additional to the
commitment made and mostly not fulfilled by developed countries to provide 0.7 of their Gross Domestic Product for Official Development Assistance ODA.
• Funding for adaptation must be targeted on the most vulnerable communities so that the new climate change
agreement serves those most affected by climate change. •
A mechanism should be implemented which leads to clear measurable, reportable and verifiable funding obligations from Parties, based on criteria and indicators that operationalise the principle of common but
differentiated responsibilities, in particular actual and historic emissions and capabilities. •
Parties should channel their contributions through the Adaptation Fund rather than through “classical” multilateral funding instruments of ODA, since adaptation is not about aid, but about compensating for the
harm caused by emissions. By its very nature, adaptation funding should be delivered as grants covering the full additional costs of adaptation.
• It is necessary to explore options to co-finance risk-sharing instruments for most vulnerable people based on
international polluter pays or capability concepts. The Nairobi Work Programme could serve as an initial forum for this analysis, with further consideration of concrete concepts in the AWG-LCA and the SBI.
• We emphasize that new, financial mechanisms and instruments for adaptation created outside the Convention
should coordinate with the mechanism developed under the Convention, with an emphasis on transparency, efficiency, and equity, and should incorporate governance shared equitably between developed and developing
countries.
• Resources generated through international mechanisms should be used to strengthen funding mechanisms
under the Convention and the Kyoto Protocol, in particular to feed the Adaptation Fund. •
Parties are strongly encouraged to come forward with more concrete proposals on how they think the resources needed for adaptation and likewise for mitigation should be generated, based on the principle of common but
differentiated responsibilities. More proposals will help to develop political will and to define the technical questions that need to be answered. We welcome the creative thinking recently undertaken by some Parties on
addressing funding for adaptation, e.g. Mexico and Tuvalu.
The greatest need for financial and technical support in adaptation is in the poorest and most vulnerable communities. Adaptation financing must be allocated in consultation with communities and with community
participation in the development of plans, programs and projects to increase community-level resilience to the adverse impacts of climate change. This is a key responsibility of governments in affected countries, but there is
an obligation of other countries to support these activities in a meaningful way. Key demands to ensure effectiveness in adaptation funding:
• International funding mechanisms and decision-making processes must be open, transparent and
accountable to local communities, affected stakeholders, and elected representatives. Stakeholder consultations must be held at both the local and national levels in affected countries.
• We call on developing country governments to ensure that adaptation funding is spent on the most urgent
underlying and growing vulnerabilities of their population, and is informed by successful community-based experiences in vulnerability reduction.
3
Bouwer and Aerts, Financing climate change adaptation, Disasters, 2006, 301: 49-63
4 •
Integrating climate risk reduction or climate proofing in the development processes of countries is the best approach to reduce the risks of climate change. Funding mechanisms should prioritise this process over
‘stand alone’ adaptation projects. Governments must ensure that assessment, planning and implementation is undertaken as part of – rather than separate from – existing processes and institutional arrangements.
• Developing country Parties need to be accountable for the management of adaptation resources, supported
by the UNFCCC process, by ensuring decision making processes and expenditure decisions are open to scrutiny by public and stakeholders. The possibility of an institutional mechanism in each recipient country
to facilitate the coordination of adaptation and the management of funds from national and international sources should be explored.
• All Parties need to engage in a process to evaluate needs for adaptation assistance, to allocate
