Adaptation, Fairness and Finance

We face an extremely difficult, complex challenge in responding adequately to mitigate and adapt to climate change. One particularly thorny aspect of this challenge is how best the West can fulfill their ethical obligation to help developing countries build capacity and fund the level of response required to successfully adapt to climate change. Adaptation refers to actions that communities/individuals/ governments can take to adjust their behaviour or their surroundings to reduce their vulnerability to climate change and mitigate impacts. Some quick research (e.g. NYT) and some common sense reveals staggering inequality in the capacity of developed vs. developing countries to respond to the impacts of climate change. In this context, capacity (pdf) refers to the ability of a country to respond successfully to climate variability and change, by adjusting their behaviour, resources, and technologies. The fact that those who are at most risk from climate change have contributed the least to the problem only adds to the difficulty of the challenge. In general, the rich have both caused the problem and are the best equipped to respond, while the most vulnerable are also poor, ill-equipped to respond, and reside in many of the places that are expected to be hit the worst by climate change.

The Cancun Agreement

The latest output from the international climate negotiations, the Cancun Agreement, includes a large segment on adaptation. In particularly, this segment focuses on programmes to increase developing country capacity and measures to transfer funds from developed to developing countries to fund adaptation responses. Interestingly, and perhaps indicating a shift in focus from mitigation to adaptation, adaptation comes before mitigation in the agreement. Major milestones from the agreement, in terms of adaptation, are summarized nicely here, here and here (pdf).

The Cancun Agreement definitely takes steps forward, but still remains very vague and process-focused, and includes no commitments from developed countries to new and additional funding, and no progress on how those funds might be raised. In addition, UNFCC bureaucrats and UNFCC stakeholders must still sort out the large task of determining the institutional arrangements and linkages, the composition of the adaptation committee, terms of reference, placement of regional centres, etc. I am skeptical that the Cancun Agreement has really provided a “pathway forward” towards a successful transfer of funds from the West to the global South (see Conservation International).

The Cancun Agreement embodies the tensions regarding how developing countries. For example, section 18:

“Requests developed country Parties to provide developing country Parties, taking into account the needs of those that are particularly vulnerable, with long-term, scaled-up, predictable, new and additional finance, technology, and capacity-building, consistent with relevant provisions, to implement urgent, short-, medium- and long-term adaptation actions, plans, programmes and projects at local, national, subregional and regional levels, in and across different economic and social sectors and ecosystems”

Within this paragraph, and others within the Cancun Agreement, it is clear what developing countries are worried about. First and foremost, they are worried about climate change impacts (among many other challenges they face), they are worried that developed countries will (I would say justifiably):

• simply re-package old funding commitments, especially aid money into adaptation funding, and
• implement adaptation measures and funding through opaque processes that developing countries do not have adequate control over.

This last concern is particularly reflected in the serious disappointment from developing countries that the World Bank was chosen to serve as interim trustee of the Green Climate Fund (see here and here). Despite some shared concerns, it is important to remember that there is quite a lot of heterogeneity amongst developing countries in terms of their goals and negotiating positions at the COP meetings, most evidently between the BRIC countries (Brazil, Russia, India, and China), and AOSIS (Alliance of Small Island States).

The Why and How of Financing Adaptation

Rich countries are grappling with how to help developing countries adapt to climate change for various reasons:

• self-interest and security: to avoid climate refugees, unrest and instability in developing countries
• ethics: it’s generally considered morally right to help those in need and it would also be appropriate if considering principles of ethics such as fairness, justice or polluter-pays, and
• because developing countries are negotiating in the international climate talks (UNFCCC) so that they will not accept proposals for how they should reduce their greenhouse gas emissions unless they get commitments for adaptation funding.

Those more cynical might just assume that rich nations are simply creating the illusion that they will fund adaptation to placate the global South while rich nations continue to pollute the atmosphere.

Where and what type of money should finance adaptation in developed countries is the subject of much debate (pdf). Given conservative estimates that the costs of adaptation in poor countries will be $75-100 billion per year (if average temperature increases are kept below 2oC), the question remains of where that money should come from and how it should be allocated – e.g. based on need or efficiency (see World Bank). Options for where the money comes from includes revenues from: a global aviation or global finance tax, carbon taxes and/or carbon permit auctions, and the redeployment of fossil fuel subsidies (see UN High-Level Advisory Group on Climate Change Financing). Opinions tend to differ on whether the funding should be from public or private sources, and whether it should be in the form of grants or loans (see Oxfam Briefing Note).

How to Get Rich Countries to Fund Adaptation

As someone who believes that rich nations have an ethical obligation to fund adaptation in developing countries, I wonder what role citizens of rich nations have in convincing their governments to commit funding, and how they might best do that. While some polling suggests that Canadians support increased foreign aid, given limited budgets, I am skeptical of how deep that commitment is, especially when cuts to other priority areas such as education and health care are being made. Some organizations, such as the Center for American Progress in the U.S. appeal to the security and economic interests of the U.S. (e.g. helping to close the competitiveness gap with China, and avoiding climate refugees). I wonder what will be more effective – appeals to self-interest or to “doing the right” thing? I suspect a targeted messaging campaign with different messages to different groups may be most effective. We know that individuals will send money to other countries deal with what are arguably the impacts of climate change (by donating to the Red Cross etc. after disasters), but sending money in advance to help countries prepare to prevent and respond more effectively doesn’t seem to have the same appeal.

At the end of the day, a large (idealistic) part of me wonders whether a revamped international agreement that included automatic transfer mechanisms, such as Contraction and Convergence would be a better pathway forward given that it would eliminate so much of the bureaucracy, petty backroom-dealing, and lengthy, laborious negotiations. Although, getting political negotiators to agree to Contraction and Convergence would probably require lengthy and laborious negotiations, not to mention a likely necessary shift in power dynamics among the U.S., China and India.