WHAT THE WORLD REALLY NEEDS TO ADAPT TO CLIMATE CHANGE

From deadly floods in Pakistan to droughtdriven starvation in the Horn of Africa, the system-wide effects of the climate change crisis are already here. Even if the world hits its target of limiting global temperature rise to 1.5 degrees C (2.7 degrees F) — which all signs point to us overshooting — many dangerous climate change impacts are already locked in. The most recent UN climate summit (COP27) brought mixed results for adaptation and left many disappointed. On the one hand, COP27 achieved an historic breakthrough, with wealthy nations agreeing to establish a fund to support vulnerable countries in responding to losses and damages caused by climate change. On the other hand, despite adaptation being a central focus of the summit, key decisions on finance and implementation fell short of expectations. The world is left far from where it needs to be in terms of securing a resilient future in the face of intensifying climatic shifts and impacts. Adaptation is still chronically underfunded and action continues to lag, despite growing awareness of the critical need for it, repeated calls to scale up meaningful action, and a growing number of national governments issuing adaptation plans. And continued fossil fuel use means the impacts of climate change are likely to intensify, making adaptation more important, but also more difficult. So, what is needed to get us on track and adapt to the pace of the changing climate? Here are four priorities for making people and systems more resilient to the climate crisis.

Every year since 2014, the UN’s Adaptation Gap report estimates the chasm between how much finance the world needs for adaptation and how much is being provided. And every year, that gap widens. Adaptation finance needs are projected to reach $340 billion annually by 2030, exponentially more than the $21.8 billion of adaptation finance expected to be available by 2025 if current trends continue. Low-and middle-income countries across Asia, Africa and Latin America, including all Small Island Developing States (SIDS), likely need 5-10 times more than this amount, with needs increasing with time. Of the little finance that is available, not enough reaches countries most vulnerable to the impacts of climate change. For example, according to the OECD, 70% of the climate finance provided and mobilized by high-income nations went to middle-income countries as opposed to low-income, highly vulnerable nations. The public and private sectors can and should scale up their contributions to adaptation, but there are actions countries can take to better position themselves to attract it. Countries can revolutionize their understanding of climate risks and develop robust plans for climate adaptation that include quantified adaptation needs and a methodology to track adaptation finance. As shown in a WRI review of national climate plans (known as NDCs), only 22 of 86 countries included cost figures for their adaptation priorities. Adaptation funding entities will find it easier to approve finance to countries with good policies, smart project design and well-structured adaptation investments. Mainstreaming climate risks into economic policies and development plans can improve adaptation finance and outcomes. Until adaptation finance is more readily available, the global costs will have real and large effects on vulnerable communities. People in flood- and hurricane-prone regions can’t build storm shelters without finance. Farmers can’t purchase water-harvesting technologies and sturdier seedlings to withstand crop-withering droughts. And healthcare workers won’t receive the trainings they need to manage increasing vectorborne diseases.

The quality of adaptation finance is also important. The concept of quality spans everything from access and accountability to having implementable projects and achieving positive impacts. Funders can improve the quality of adaptation finance by becoming more:

• Aligned with the “subsidiarity principle,” which asserts that decision-making about adaptation investments should be devolved to the lowest-appropriate level. This helps ensure that finance supports the adaptation priorities of the people most directly affected, while also recognizing that the most local level is not always the most appropriate, and that “local” encapsulates a wide and diverse range of actors.

• Flexible, with policies that allow local actors to control funds in ways that best fit their needs and evolving contexts, while still maintaining good transparency and accountability.

• Patient, by allowing for longer timeframes for achieving desired outcomes. Longer-term finance can support capacitybuilding and investment in local institutions. It also provides time for communities and stakeholders to learn what works and adapt to changing conditions.

• Predictable, so that local actors and other partners can count on continued or future funding and plan accordingly.

• Efficient, so that financing flows to projects with clearly defined goals, high local implementation capacity, and a strong likelihood of delivering benefits.

• Grant-based, so that countries can finance their adaptation needs without going deeper into debt. Many adaptation investments provide crucial public goods, but not always high revenues, requiring grant-based rather than loan-based finance.

3) IMPROVED IMPLEMENTATION AND TRACKING OF ADAPTATION PROJECTS

Securing more, higher-quality adaptation finance is essential for countries to move from adaptation planning to implementation. And to ensure progress is happening, countries must strengthen their national public financial management (PFM) systems to track project implementation. PFM refers to the entire set of policies and processes that govern how countries use public funds across all sectors, from revenue collection to monitoring public expenditures. It includes how budgets are allocated and whether results are achieved. Given that climate change risks can affect all sectors, PFM systems can help identify and manage those risks. While PFM systems won’t replace technical knowledge and planning, they do help track progress. They also help provide necessary information for technical monitoring, evaluation and learning (MEL). PFM and MEL systems are critically important, yet underdeveloped. According to a 2021 study, over 60% of countries that submitted a national adaptation plan to the UN were not yet tracking its implementation. Although countries are making headway on setting up climate PFM systems, many need more support to do so, including resources like staff, technical expertise, data management and financing. Uruguay offers a powerful example of setting up a strong MEL system. The country developed a robust tracking system for multi-sectoral adaptation measures, including diverse priority areas from cities and land-use planning to agriculture and coastal areas. Uruguay invests in data collection to monitor measures being implemented, including producing a publicly available mapping platform of adaptation projects across the country. International climate finance from the Global Environment Facility and E.U. have been critical to operationalizing and maintaining these efforts.