A glimmer of hope ahead of COP26 – financing for adaptation

A newly formed group of champion countries committed to ramping up flows of adaptation finance brings promise – provided they can also improve access, explains guest blogger Angelique Pouponneau.

Angelique Pouponneau's picture
Angelique Pouponneau is CEO at Seychelles Conservation and Climate Adaptation Trust
06 October 2021
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Landscape of an island with houses and vegetation surrounded by the sea.

Port Victoria, Seychelles (Photo: Harry and Rowena Kennedy via FlickrCC BY-NC-ND 2.0

I stare out the window as the waves crash closer and closer to my favourite walking spot along the beach. The seas are rising; it invades our homes. The temperatures are rising, ecosystems are collapsing; the impacts cripple the economy.

Adapting is our only option. Millions of Seychelles rupees are being invested in climate-smart infrastructure to climate-proof our economy. But who should foot the bill?

Developing countries, particularly Small Island Developing States (SIDS) and Least Developed Countries (LDCs), have been calling for more finance to support our efforts to adapt to adverse climate impacts, including loss and damage from climate change.

The adaptation finance gap

Adaptation finance has always played second fiddle to mitigation.

During a high-level side event at last month’s UN General Assembly – supported by IIED and E3G and also part of Climate Week NYC – Denmark’s development coordination minister Flemming Møller Mortensen sobered the audience with the statistic that only a quarter of international climate finance for developing countries goes to adaptation.

A glimmer of hope

But the calls from developing countries have not gone unheard; raising our voices has not been in vain. This event saw the launch of the new Champions Group on Adaptation Finance.

During this virtual event, six countries – Ireland, the Netherlands, Denmark, Sweden, the UK and Finland – expressed clear political commitment to work with developing countries to increase levels of adaptation finance.

Specifically, the group has pledged to increase the total share of climate finance spent on adaptation and resilience, particularly for LDCs and SIDS, by committing to a balanced approach in their own public climate finance, leading by example and encouraging others to join them in this effort. They also commit to advocate for improved quality and accessibility of adaptation finance.

During the launch, the group announced that Germany had signalled its intention to join the group and other countries that share the objectives of the group are invited to do the same.

Accessible finance

But these calls for finance need to be more specific: adaptation finance needs to be accessible with clear steps for getting there.

The LDC and SIDS governments have huge challenges in accessing climate finance and have no option but to contract expensive international consultants to draft elaborate proposals to meet complex, lengthy and bureaucratic procedures. Using international intermediaries often eats up large chunks of finance before it even reaches the country.

Over the years, attempts have been made to simplify approval processes and support direct access to adaptation finance through national implementation entities. While further improvements are still needed, it is paramount that we use these lessons to continue to evolve the system to ensure that the finance is, in fact, accessible.

Access for the most vulnerable

But reaching governments alone is not enough; the funds must be accessible to vulnerable people on the frontlines who feel the harshest impacts of climate change, as called for by the principles for locally-led adaptation, which are now endorsed by more than 50 organisations.

Non-governmental bodies, national intermediaries – such as locally-managed trust funds – and community-based organisations need to be able to tap into funding opportunities as it is these actors who can most easily reach youth, women and other marginalised groups. Combining their local expertise and Indigenous knowledge with science, these groups are emerging with innovative solutions that protect both planet and people.

With innovations based on lived experience, these solution providers must be at the decision-making table, joined in equitable partnership with the climate finance providers. In this way, finance requests for proposals can be co-designed and co-defined by both groups – ensuring local needs are met.

The middle- and high-income SIDS

Speaking of access, it would be remiss of me not to mention the plight of middle-income and high-income SIDS. These countries are still vulnerable to climate change but with higher GDPs, struggle to access finance.

This categorisation unfairly hinders these countries’ whose need for support is also great: in the Seychelles – with a population of 90,000 people – seeking to invest in the infrastructure needed to build a climate-resilient port means each person has a heavier cost to bear than if the population were larger. Yet the special case of SIDS – whether low-, middle- or high-income – is too often ignored.

Financing must be sustainable

We need to be wary of setting countries up for failure, where they are given an initial injection of funds without a sustainable financing mechanisms to support it.

Debt-for-climate swaps, for example, provide long-term financing support rather than 1-3 year grants cycles.

Building more hope

The commitments put forward by the champions group to ramp up adaptation finance are a step in the right direction. But the commitment to increase funding must be genuine: finance must be new and additional rather than simply re-channelled from elsewhere.

If the group is to achieve its objectives, climate finance providers must move away from business as usual and work with developing countries and their people to find ways to improve the quality of finance to deliver clear and targeted outcomes, but most importantly to ensure the finance is accessible and supports effective interventions to reach the adaptation goal.

I call on other countries to join this champions group to give us hope for real progress on adaptation finance at the upcoming COP26 and beyond.

If their ambition offers insight into what COP26 has in store, I look forward to seeing you all there as we drive this agenda forward!