Adaptation Finance Research Articles

The Effect Government Recognition of Indigenous Communities Has on Climate Adaptation Funding in the United States

The Effect Government Recognition of Indigenous Communities Has on Climate Adaptation Funding in the United States

Does Climate Finance Really Affect Ecological Quality in Developing Countries? Fresh Evidence From the Method of Moments Quantile Regression Approach

ABSTRACTThis study investigated the impact of climate finance on the ecological footprint (EF) of 111 developing countries from 2002 to 2018 to determine its real effects on ecological quality. The study applied the method of moments quantile regression (MMQR) to address nonnormality, individual heterogeneity of the EF and outliers. Additionally, the connection between climate finance and the EF is revisited, considering recipient countries' income diversity and the nature of climate finance. In addition, the analysis is repeated by splitting the sample periods into 2002–2009 and 2010–2018, subject to COP15. The results indicate that climate finance has negative and significant impacts on EFs across all quantiles (Q0.25, Q0.5, Q0.75 and Q0.9), inferring that climate finance robustly improves the ecological quality of developing countries. These findings further imply that mitigation finance has a robust effect on improving ecological quality across all distributions. In addition, adaptation finance has heterogeneous effects on EFs, positively impacting ecological quality at higher quantiles. Moreover, the effects of climate finance on ecological quality depend on income heterogeneity, having a negative effect on the EF of middle‐income countries and an insignificant effect on low‐income countries. The results further showed that the positive effects of climate finance on ecological quality became stronger after COP15. The findings are robust to alternative methods. Policy implications are suggested based on the findings.

Climate Change and the Struggle for Climate Justice

Climate change is one of the greatest global challenges. The phenomenon and actions taken to address it have thrown up some contentious issues. One of such issues is climate justice. This paper analyses the bases for climate justice and the attempts at achieving it. The basic sources of data were the publications/documents of the United Nations Framework Convention on Climate Change (UNFCCC) secretariat and the Intergovernmental Panel on Climate Change (IPCC). Information was also obtained from the publications and websites of the climate negotiation blocs, such as G77 + China and Alliance of Small Island States (AOSIS), and several Civil Society Organisations (CSOs) such as Climate Action Network, Oxfam, GreenPeace and Third World Network. The climate justice struggle has been necessitated mainly by two driving forces. These are the experiences of the impact of climate change and the environmental legal principles that have emerged from environmental and climate change challenges. In spite of the fact that climate change and its impact are global, vulnerabilities vary across regions and socio-economic groups. The disproportionate impact of climate change is one of the drivers of the struggle for climate justice. The environmental/climatic legal principles that have formed bases for the climate justice struggle derive largely from UNFCCC, the Rio Declaration and the Paris Agreement. They are, to an extent, related to the Principle of Disproportionate Climate Burden. The principles include Common But Differentiated Responsibilities, Polluter Pays, No-Harm (to others) and Beneficiary Pays. Strategies employed in the struggle for climate justice include advocacy, focused negotiations at CoPs, protests/strikes, and litigation. Although, the developing countries have been the leaders in the struggle for climate justice, CSOs have been particularly prominent. The demand for increased financing of climate mitigation and adaptation has been characteristic. The struggle has resulted in more climate action. However, the ultimate focus must be the achievement of net zero emissions.

Blinded by the ‘green-halo’? Equity in financing climate adaptation of urban sanitation

Adapting urban sanitation systems to changing climate conditions will require substantial investments. However, there is a gap in understanding the funding strategies for such adaptation measures, especially amid concerns that resilience measures might reinforce existing urban sanitation inequalities. Through cross-case document analysis and complementary key informant interviews, we examined the sanitation adaptation investments in eight cities, focusing on their funding arrangements and social and intergenerational equity implications. Debt financing of sanitation adaptation often relies on repayment through customer bills with only opaque considerations of the affordability for different socio-economic customer groups. The lack of appropriate accounting for the lifecycle costs of resilient infrastructure threatens to mortgage future generations. There is no convincing evidence that ‘greening’ of adaptation financing either shifts or redistributes the financial risk more equitably nor does it make the repayment of the investments substantially cheaper for customers. We conclude that a public sector funding approach is most appropriate to ensure social and intergenerational equity within climate-resilient sanitation systems.

Is health being considered by funding towards climate adaptation and mitigation?

Abstract Introduction Funding is essential to build climate resilience in public health and healthcare systems and enable populations to adapt to the increasing impacts on climate change on health across the globe. This study aimed to investigate how health has been considered by the projects supported by the Green Climate Fund (GCF), created by the Paris Agreement to support climate adaptation and mitigation. Methods Adaptation, mitigation, and cross-cutting projects funded by the GCF between 2021 and 2023 were included. Information was collected for the percentage of funding allocated to health adaptation by cross-cutting and adaptation projects. For mitigation projects, information was extracted on the extent to which health co-benefits were considered. Results The 69 adaptation and cross-cutting projects funded by the GCF in 2021-2023 contributed $226 million towards adaptation, of which $59 (26%) million were for health adaptation. There was an increase in the funding provided by the GCF to adaptation from $1 million in 2021 to $156 million in 2023. Funding for health adaptation increased from $178,000 in 2021 to $42 million in 2023. Of the co-funding provided by beneficiaries, $637 million contributed to adaptation and $165 (26%) million to health adaptation. There was an increase in co-funding for adaptation provided by beneficiaries from $131 million in 2022 to $506 million in 2023, with funding for health adaptation increasing from $23 (18%) million to $142 (28%) million. Among the 48 mitigation and cross-cutting projects, 15 did not mention health, 13 mentioned did not correctly articulate health co-benefits, 11 identified specific health co-benefits, and 9 correctly labelled and measured health co-benefits. The main co-benefits derived from reducing air pollution. Conclusions Among the projects funded by the GCF, funding for health adaptation remains a small proportion of the adaptation funding and health co-benefits are rarely considered by mitigation projects. Key messages • The proportion of adaptation funding provided for the health sector remains low. • Health co-benefits are seldom considered and measured by climate mitigation projects.

Discovering the effectiveness of climate finance for Somalia’s climate initiatives: a dual-modeling approach with multiple regression and support vector machine

IntroductionThis research investigates into the complex dynamics of climate finance in Somalia, a vulnerable region facing the dire consequences of climate change. The study aims to assess how financial inputs for climate-related projects align with the actual needs and identify critical factors that influence funding effectiveness.MethodsA dual-methodological approach was employed, integrating both multiple regression analysis and Support Vector Machine (SVM) techniques. This mixed-method analysis facilitates a robust examination of climate finance data to dissect the relationships and impacts of various determinants on funding effectiveness.ResultsThe results indicate that adaptation finance, robust governance, and the scale of financial interventions significantly enhance the effectiveness of climate finance flows. However, mitigation finance and aspects related to gender equality displayed less significant impacts. Notably, the study identifies a pervasive underfinancing of climate projects in Somalia, illustrating a significant gap between the needed and actual funds disbursed.DiscussionThe findings underscore the need for enhanced governance frameworks and targeted large-scale financial interventions to optimize the allocation and impact of climate finance in vulnerable regions like Somalia. By quantifying the influence of adaptation finance and governance, this study contributes new insights to the literature on climate finance effectiveness and suggests practical strategies for policymakers and practitioners to improve climate resilience initiatives.

Determinants and effects of climate finance in the transport sector

We examine the determinants of climate-related development finance flows to the transportation sector and their relationship with CO2 emission levels. The mitigation fund allocation is particularly correlated with the demographic characteristics of recipient countries; however, the correlation with per capita income and emissions seems to be weak. In contrast, equity considerations appear to be the main determinants of adaptation fund allocation. Finally, we find some evidence of a significant negative relationship between mitigation investments and emissions per capita and while the overall effect is modest, it tends to be most marked in countries with the highest per capita emissions. Thus, the fact that countries with the highest emissions per capita are not receiving relatively more investments may be hampering the effectiveness of climate finance.

Design by Transitional Committee: learning from the Green Climate Fund

ABSTRACT In 2022 at the UN climate conference in Sharm el-Sheikh (COP27), countries agreed to establish a new fund for loss and damage. This decision was one of the most significant outcomes of the COP, and something Small Island Developing States had spent the previous three decades calling for. The approach taken to realize this new funding arrangement includes many similarities to that taken to create a similarly significant new fund twelve years earlier – the Green Climate Fund (GCF) – including its design by a Transitional Committee. The aim of this article is to assess the extent to which the ambitions for the GCF have been realized, with a view to informing the ongoing design and early implementation of the new fund. To do this, the article compares the GCF’s present-day outcomes to its original intentions as described by the COP16 decision text. This paper finds that the GCF’s operation today only partially reflects the ambitions expressed at COP16. While the ambition for a Board with equal representation by developing and developed countries has been achieved, ambitions to expand the sources of finance and increase funding for adaptation have been mixed. The influence of the World Bank was a key point of tension over the GCF’s Transitional Committee period, and the Bank continues in the Trustee role today. The role of the Committee’s Technical Support Unit – the group of staff seconded from various international development banks and agencies to provide technical and administrative support to the GCF’s Transitional Committee – had an outsized influence on the shape of the GCF, such that these organizations continue to receive the bulk of GCF funding today. These findings suggest a greater plurality of voices providing such technical inputs would enhance the design of new funding bodies. The creation of new international finance institutions is relatively rare, so understanding the history of the GCF’s design is important for contextualising discussions about other climate finance options.

Climate change impacts on maternal health and pregnancy outcomes in Africa

ABSTRACT The review examines how climate change adversely affects maternal health and pregnancy outcomes in Africa, a region particularly vulnerable to climate-related disasters. It highlights the increased incidence of tropical and waterborne illnesses due to climate change, disproportionately impacting expectant mothers. The study thoroughly evaluates the effects of extreme weather events like heatwaves and floods on maternal health, both directly and indirectly. It underscores significant gaps in policy and research within African health sectors regarding these issues. Key findings reveal that maternal death rates remain alarmingly high, with risks like preterm birth, stillbirth, and maternal hypertension exacerbated by climate change. The review calls for urgent action, including enhanced research, increased funding for climate adaptation, and the integration of maternal health into broader climate resilience strategies. Additionally, it emphasizes the need for greater awareness and international collaboration to strengthen health systems in Africa, particularly addressing the vulnerabilities of pregnant women. This work aims to enhance understanding among policymakers and researchers about the critical health impacts of climate change on pregnant women in Africa.

Adaptive capacity to climate change: Does energy aid matter?

The global call for augmented financial support to satisfy the growing requirements for adaptation funding, essential for enabling vulnerable groups to withstand the ramifications of climate change, has been resonant. Channeling energy assistance to developing countries may serve to ameliorate this shortfall. Through an empirical analysis using a balanced panel dataset comprising 64 countries from 2002 to 2020, the research investigates the role of energy assistance in enhancing the adaptive capacities of developing nations. Our analysis identifies critical areas with pronounced deficiencies in adaptive capacity, primarily situated in sub-Saharan Africa, South Asia, Central Asia, and western South America. The study reveals that energy aid, notably in the forms of non-renewable, policy-related, and distribution assistance, significantly elevates adaptive capabilities. Although this assistance yields significant benefits for countries across various income levels, the impact is relatively greater for higher-income nations. Additionally, energy aid indirectly bolsters adaptive capacity by stimulating innovation, and an improvement in the quality of governance aids in enhancing the effectiveness of energy assistance implementation, especially for lower-income countries. The study concludes by offering nuanced policy insights aimed at donors and recipients alike, with the goal of augmenting the efficacy of aid to improve climate change adaptation.

Sea Level Rise and Coastal Erosion in Miami

Purpose: The aim of the study was to analyze the sea level rise and coastal erosion in Miami. Methodology: This study adopted a desk methodology. A desk study research design is commonly known as secondary data collection. This is basically collecting data from existing resources preferably because of its low cost advantage as compared to a field research. Our current study looked into already published studies and reports as the data was easily accessed through online journals and libraries. Findings: Sea level rise and coastal erosion in Miami are growing environmental concerns due to the city's low elevation and proximity to the ocean. Studies have shown that rising sea levels, driven by climate change, are accelerating the erosion of Miami's coastline, threatening infrastructure, homes, and ecosystems. The increased frequency of tidal flooding and storm surges exacerbates the problem, making coastal areas more vulnerable. Unique Contribution to Theory, Practice and Policy: Resilience theory, social vulnerability theory, ecosystem-based adaptation (EBA) Theory may be used to anchor future studies on sea level rise and coastal erosion in Miami. Implement local ICZM strategies that involve stakeholders in decision-making processes, ensuring that community needs are met while enhancing coastal resilience. Advocate for policies that support adaptive management practices and funding for local ICZM initiatives.

Three Injustices of Adaptation Finance - A Relational Egalitarian Analysis

This primarily diagnostic paper offers, from the perspective of relational egalitarianism, a normative analysis of three major injustices in the context of adaptation finance. Adaptation finance includes payments provided by the affluent countries of the Global North to low-income countries in the Global South, countries particularly exposed to the harms of climate change. Relational egalitarianism is the normative view that interactions between people and between institutions have to respect the equal moral status of every human being. The first injustice, from this perspective, consists in the sheer fact that adaptation measures are required at all to deflect harm from people who did not significantly contribute to the causes of climate change. The second injustice consists in the persisting, even increasing adaptation finance gap, as countries of the Global North do neither provide adequate financial means to reduce climate risks, nor even fulfil their commitments to adaptation finance pledged in the Copenhagen Accord in 2009. The third injustice emerges from current procedures to determine criteria for distributing scarce financial resources that consolidate structural injustice. The paper concludes by providing the contours of a practical response to these injustices that respects the demands of relational egalitarianism.

Climate finance spillovers and entrepreneurship in developing countries

AbstractResearch SummaryWe conduct a multicountry analysis and show that there is a strong and significant positive relationship between climate finance and entrepreneurship, even after controlling for conventional macroeconomic and institutional factors commonly reported in the literature. Specifically, a 10% increase in climate finance is linked with a 2% increase in entrepreneurial activity across most countries. There are important heterogeneities in this nexus as it relates to fossil fuel exporting countries—the main “losers” from a global move away from fossil fuels. We find that although fossil fuel exporting countries exhibit notably faster rates of entrepreneurship growth, the interaction with climate finance in these countries is negatively related to entrepreneurial activity. This finding holds across different types of climate finance—adaptation and mitigation—highlighting its robustness.Managerial SummaryIt is often suggested that more finance will lead to more entrepreneurship. We conduct a multicountry analysis and add nuance to this notion. We find that although there is a strong and significant positive relationship between climate finance and entrepreneurship in most countries, this is not always true for fossil fuel exporting countries. Fossil fuel exporting countries, despite experiencing faster entrepreneurial growth, exhibit a negative interaction between climate finance and entrepreneurship. For managerial practice, these results emphasize the importance of targeted strategies in deploying climate finance. Policymakers and investors should consider nuanced approaches that address the specific economic dependencies and regulatory environments of fossil fuel exporting countries.

Resisting Post‐Political Adaptation to Climate Change: How a Small Community Stood Up to Big Development

AbstractRecent critical scholarship has brought attention to local resistance in the spaces of adaptation, with reported instances of local communities rejecting planned adaptation interventions around the world. As adaptation funding is only expected to grow, so should our understanding of this resistance. In this article, I investigate one such dispute where residents of a small village in São Tomé and Príncipe refused to participate in an adaptation project implemented by the national government and the United Nations Development Programme. I ground my analysis in the literature on post‐politics and discuss the community's resistance as a Rancièrian “political interruption” of the post‐political adaptation configuration in the country. I also investigate the factors that arguably led to local resistance, including the residents’ disillusion with what I term Big Development, and their political subjectivation through a local grassroots initiative. The paper concludes with reflections on countering the post‐politics of adaptation as a prerequisite for more democratic and equitable local climate governance.

The Economics of Electricity and Development: Planning for Growth and a Changing Climate

Many low- and middle-income countries have made tremendous gains in electrification over the past few decades. These improvements in electricity access have enabled a growing body of empirical evidence on its impacts. This article complements prior reviews on the impacts of electrification by addressing several major remaining challenges faced by the electricity sector in developing countries—impediments to maximizing electricity services᾽ economic effects, obstacles to recovering utility costs, difficulties in forecasting future electricity demand, and uncertainty regarding the future adoption of climate-mitigating technologies—and the existing micro economic causal evidence addressing those challenges. We describe how randomized experiments have complemented the quasi-experimental evidence and then highlight some remaining gaps in the existing literature. Specifically, we highlight climate adaptation within the electricity sector in developing countries, which remains a crucial gap in both the discussion on and financing of electrification for development. We use case studies of Nepal and Pakistan in South Asia—a region that both recently experienced great electrification gains and is among the most vulnerable to climate change—to illustrate the need for additional work on adaptation in the electricity sector. We conclude by linking to recent discussions on climate adaptation finance.

Exploring the complications of climate change funding in Sub-Saharan African countries

Globally, climate change funding has become a focal point and debate among international organisations, private agencies, governments, and civil societies mainly because of its significant threats to social, economic, and the environment and the significant funds needed to adapt and mitigate its impacts. While substantial amounts of funds have been secured and distributed to governments, private organisations and institutions in the continent to mitigate and cope with the threats of climate variabilities, the outcomes have failed to meet the desired outcomes due to limited access to funding, lack of transparency in allocations and the failure of the funds to reach local communities where the impacts are significantly felt. Using a conventional approach of data collection tools predominantly of quantitative and qualitative methods and extensive literature materials, this paper explored the complexities and constraints of sourcing climate change funding and the mechanisms of distribution funds across the continent. The findings unearthed that climate funding lacks transparency and equitable distribution; furthermore, there are substantial bureaucratic processes, capacity constraints and immense conflicting priorities among countries on the continent. Our findings uncovered that addressing these anomalies will require innovative funding structures that catalyse technical assistance programmes to support the creation of new avenues for climate finance as well as reforming global financial institutions, emphasising debt reductions, freeing up additional funding for climate change mitigation and adaptation, and channelling private finance to both climate and sustainable development, particularly in the more vulnerable countries.

Micro-business participation in collective flood adaptation: lessons from scenario-based analysis in Ho Chi Minh City, Vietnam

Abstract. Although research on the impacts of climate change on small- and medium-sized enterprises (SMEs) and their adaptation to climate change risks has recently received more attention, the focus on micro-businesses and household businesses is still very limited. Micro-businesses and household businesses are adversely affected by compound flooding events – a situation that will become more acute in the future – but there is little attention in the scientific literature to their adaptation options and actual implementation. Against this background, the paper analyzes the following research questions. How are micro-businesses already responding to flooding? Are micro-businesses willing to collectively invest in future proactive adaptation efforts in their neighborhoods? What are the key drivers of and barriers to adaptation? Based on scenario-based field experiments in Ho Chi Minh City, our results show that micro-businesses could play a much larger role in collective adaptation. Often overlooked in adaptation research, their willingness to engage in collective action under severe constraints is surprising. The conceptual framework presented in this paper helps us to understand the key drivers of and barriers to micro-business willingness to participate in collective adaptation activities. The most important key barriers for micro-businesses are limited financial capacity and lack of support from local authorities. However, micro-businesses are willing to contribute depending on the concrete adaptation measure and financing options. If no financial contribution is expected, almost 70 % are willing to participate in awareness-raising campaigns. And although their financial capacity is very limited, 39 % of micro-businesses would contribute financially if the costs were shared with other businesses in their neighborhood and with local authorities. In this context, micro-businesses should be much more involved in adaptation plans and measures. Through their local embeddedness, they can be important multipliers in strengthening adaptive capacity at the local level.

Asset-level assessment of climate physical risk matters for adaptation finance

Climate physical risk assessment is crucial to inform adaptation policies and finance. However, science-based and transparent solutions to assess climate physical risks are limited, compounding the adaptation gap. This is a main limitation to fill the adaptation gap. We provide a methodology that quantifies physical risks on geolocalized productive assets, considering their exposure to chronic and acute impacts (hurricanes) across the scenarios of the Intergovernmental Panel on Climate Change. Then, we translate asset-level shocks into economic and financial losses. We apply the methodology to Mexico, a country highly exposed to physical risks, recipient of adaptation finance and foreign investments. We show that investor losses are underestimated up to 70% when neglecting asset-level information, and up to 82% when neglecting tail acute risks. Therefore, neglecting the asset-level and acute dimensions of physical risks leads to large errors in the identification of adaptation policy responses, investments and finance tools aimed to build resilience to climate change.

What really happened at COP-28 in Dubai: A personal view

This article describes the most meaningful developments at the 28th Conference of the Parties (COP-28) of the United Nations Framework Convention on Climate Change (UNFCCC), which took place in Dubai, United Arab Emirates, November 30 – December 13, 2023. This is done, in part, by reflecting on the history of these annual meetings, drawing on the author's experience of participating annually over a period of sixteen years. This history reveals the evolution over time that has taken place in the relative importance in the annual meetings of the official negotiations compared with the simultaneous participation of civil society. The press coverage of COP-28 is examined, along with the important role played by two countries – China and the United States, the dramatic increase in attention given to methane, and two disappointments, one associated with funding for adaptation, and the other connected with provisions for carbon markets.

A gap approach for preventing stress in complex systems: managing natural hazard induced fiscal risks under a changing climate

Disasters associated with natural hazards as well as climate change are happening within complex socio-economic systems and desired system states, including sustainable development and resource management, are formulated on the global as well as regional and national levels. However, complex system approaches are yet only rudimentarily incorporated in related applications, and we discuss modeling as well as policy challenges focusing on fiscal risk. As an intermediate step we suggest a gap approach which we relate to fiscal stress levels a complex system may experience due to natural hazard events. We argue that in case of no gaps one can assume a no stress situation and therefore modeling of disruptions including cascading effects is less necessary. However, at the same time we also acknowledge that there is an urgent need to address corresponding challenges with complex system methods. Policy-wise our paper responds to concerns for real-world applications and can provide insights to support current discussions within the UNFCCC and Paris Agreement around both adaptation finance and the new funding arrangements for loss and damage from climate impacts established at COP27.