Innovation needed to turn on climate cash tap for the poor

Reuters News
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Posted: Apr 29, 2016 6:47 AM

By Laurie Goering

DHAKA (Thomson Reuters Foundation) - When residents of the low-lying Del Rosario slum settlement in Valenzuela City in the Philippines noticed floodwater was lapping half a finger's length higher up their homes each year, they decided it was time to do something.

They began contributing to a community savings fund so they could pay to raise the flooded cement paths that link their homes to drier land nearby, and try to buy the plot where they were squatting to build safer, higher and more permanent homes.

City officials, impressed by their initiative, agreed to carry out a boundary survey of the area for them, and ultimately issued permits for new homes once the group of 96 residents managed to buy their tiny patch of flood-prone land.

Uniting communities to start the work that needs to be done to adapt to climate change impacts – rather than just waiting for help – can be crucial to persuading governments to step in, said Ruby Haddad of the Homeless People's Federation Philippines, which helped organize the Del Rosario community.

"It's very powerful to show the local community is not a burden on the government, that we are also implementing solutions," she said.

As climate change effects like sea-level rise and drought strengthen around the world, finding ways to channel money to on-the-ground adaptation is becoming increasingly urgent.

SIMPLER ACCESS?

Officials at the Green Climate Fund – which by 2020 is hoping to handle much of a promised $100 billion a year in funding to help poorer nations adopt clean energy and cope with more extreme weather and higher seas - have said it will channel half its cash to adaptation projects.

It is also working to provide poorer countries in need of money with "direct access" to funds though institutions they choose, rather than routing much of the funding through large banks, as has happened with most climate finance up to now.

But creating such a shift is hugely challenging, experts told a meeting on community-based adaptation to climate change this week in Dhaka.

Smaller governments and organizations face the same dauntingly complex paperwork and approval processes as big ones, even though they are usually seeking much less cash.

And as the Green Climate Fund strives to meet an ambitious goal of pushing out $2.5 billion in 2016, it will be easier to fund fewer large projects than many smaller ones, experts say.

Funding for a first group of eight projects approved in 2015 is being channeled mainly through big institutions, in part because few others have been approved to work with the fund yet.

"There are lots of challenges to really access these resources," said Raju Pandit Chhetri, director of the Kathmandu-based Prakriti Resources Centre. "So much has to be in place."

Efforts to help poorer countries develop the capacity to qualify for funding are underway in many places. But simply finding developing-country ministries, NGOs or other bodies willing to undertake the grueling accreditation process is tough, at least in Nepal, Chhetri said.

"The process takes lots of time and money, and there’s no guarantee you will get accredited,” he said. “It’s a huge investment for an organization to commit to this.”

To ease the problem, he believes poor countries seeking less money should face simpler and less stringent accreditation requirements in the early rounds of funding, with standards tightening as they learn and seek larger amounts.

"You can’t put a 25-year-old, a 16-year-old and a 5-year-old at the same starting line for a race,” he said. "It’s not fair.

"If it fails, it fails. But let us make an effort, so that in the long run we do not always rely on international institutions. We want to open that door,” he added.

COMPETITION

Another way to help ensure money is spent more effectively on adaptation in poorer countries is to make sure the blizzard of projects carried out by different donors and at different levels of government is better planned, said Margaret Barihaihi of the Africa Climate Change Resilience Alliance.

The alliance has so far helped countries such as Mozambique, Ethiopia and Uganda set up a coordination system for adaptation projects so that they reach the right areas, avoid duplication, meet the goals set by communities, and focus on the country's top priorities.

"We are preparing governments, so they will have a system that can absorb money," Barihaihi said. "If we get this right, projects will be flowing."

At the same time, too much government control can be a risk, particularly if there is perceived to be political bias in how projects are managed, warned Binita Maharjan, representative of a ward-level disaster management committee in Nepal.

Sarah Colenbrander, a researcher with the London-based International Institute for Environment and Development, said getting more money into the hands of communities may require rich-country consultants and organizations to step back from seeking so much of the pot for their work.

"A much larger share of funding needs to reach local governments and that’s hard to do when so many people are competing for finance,” she said.

Donors seeking to get more cash directly to poor communities should consider giving to innovative funds such as the Urban Poor Fund International, which pools savings of slumdwellers to provide loans for anti-poverty projects, Colenbrander said.

Putting seed money into such funds can provide much-needed capital for community adaptation projects, like the one to reduce flood risk in Del Rosario slum, she said, and can potentially leverage government and international finance.

“It makes a big difference to go to an official saying, 'We can bring this much money - we need your help and technical resources,' rather than just going with open hands,” she said.

(Reporting by Laurie Goering; editing by Megan Rowling; Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers humanitarian news, climate change, women's rights, trafficking and property rights. Visit http://news.trust.org/climate)