Climate funding sees gap between promises and reality
Despite spending $1.2 billion annually, Bangladesh faces a $7.3 billion climate adaptation funding gap, says GCA CEO
Bangladesh, considered one of the most vulnerable countries to climate change impacts, is facing a funding shortfall for adaptation efforts.
"Bangladesh spends roughly $1.2 billion annually to address climate change threats, but the actual financing needs are closer to $8.5 billion per year," said Prof Patrick V Verkooijen, CEO of the Global Center on Adaptation (GCA), during a recent interview with The Business Standard.
Hosted by the Netherlands, GCA engages in policy activities, research, communications, and technical assistance to government and the private sector, policy development, research, advocacy, communications, and partnerships.
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Verkooijen, who is the chair of the organisation's executive board, expressed disappointment with developed countries for failing to fulfil their commitment to double climate adaptation aid for developing nations like Bangladesh.
Why is that number going down? Because development partners are reducing their development budget. And why are they reducing their development budget? Because of the Russia-Ukraine war, the Palestine crisis and after Covid-19 they didn't recover their economy.
"Geopolitical and economic instability are leading these developed nations to reduce their adaptation financing. The Russia-Ukraine war, ongoing issues in Palestine, global inflation, and the worldwide food security crisis are causing economic hardship for many countries," he said.
Verkooijen noted a significant discrepancy between promises and reality regarding climate adaptation funding.
At the 2021 Glasgow Climate Summit, world leaders pledged to double adaptation finance for developing countries, increasing annual funding from $20 billion to $40 billion.
"However, to date, no additional funding has materialised. Leaders reaffirmed their commitment at COP27, but the numbers continue to decline," he said.
Verkooijen highlighted the lack of economic justification as a key reason for this trend, underscoring the need for data-driven advocacy.
He pointed out, "The countries' leaders had promised to double the $20 billion aid to $40 billion by 2025 at the COP27, but the figure is far from doubling. It is only going down and down.
"Why is that number going down? Because development partners are reducing their development budget. And why are they reducing their development budget? Because of the Russia-Ukraine war, the Palestine crisis and after Covid-19 they didn't recover their economy."
Verkooijen, a climate expert and former World Bank special representative for climate change, also commented on the economic benefits of investing in climate adaptation.
He pointed out that the International Monetary Fund's (IMF) Resilient Sustainability Facility, while touted as the world's largest climate change fund, lacks a dedicated climate department. Organisations like the GCA provide the IMF with expertise and support in specific sectors.
In all development finance, loans, grants, and sorts of projects being implemented today, tomorrow, and the day after - a climate lens needs to be approved. So, it's not only about more money flowing in but also spending the existing money more wisely
Verkooijen stressed the importance of evidence-based advocacy and informed decision-making. He stated that every dollar invested in climate adaptation yields a much higher economic return than other investments.
He also advocated for a shift in development project planning, urging a focus on cost-effective, nature-based solutions.
"In all development finance, loans, grants, and sorts of projects being implemented today, tomorrow, and the day after - a climate lens needs to be approved. So, it's not only about more money flowing in but also spending the existing money more wisely," he said.
Verkooijen highlighted Bangladesh's leadership in climate adaptation planning and action.
The Bangladeshi government has established a comprehensive set of national adaptation plans, including the Mujib Climate Prosperity Plan (MCPP) 2022-41, the National Adaptation Plan (NAP) (2023-50), the Bangladesh Climate Change Strategy and Action Plan (BCCSAP), and Nationally Determined Contributions (NDC).
Verkooijen commended Bangladesh's extensive policy framework for adaptation, underscoring its crucial role in attracting climate finance. He further praised the unprecedented detail and comprehensiveness of Bangladesh's policy framework compared to other developing nations.
He also lauded Bangladesh's pioneering work in locally-led adaptation projects. These projects serve as a model that can be replicated in other regions around the world.
For instance, the adaptation initiatives implemented in Mongla and Chattogram are being adopted and implemented in Liberia, Kenya, and other countries.
Sharing his observations from a recent visit to Chattogram, Verkooijen said, "Bangladesh stands out globally as the only country actively implementing a People's Adaptation Action Plan."
"Bangladesh is on the frontline for transforming the development agenda in the face of climate change," he concluded.
