HUE-5: International finance for climate adaptation (from budget resources)

2019 Monitoring Report on the German Strategy for Adaptation to Climate Change

Table of Contents

 

HUE-5: International finance for climate adaptation (from budget resources)

In recent years, there has been a distinct increase in the endeavour to support adaptation in an international context. The proportion of adaptation-relevant funding compared to the overall international climate funding has increased from just short of 25 % in 2010 to 41.4 % in 2017. The demand for adaptation funding will further increase in future.

Two lines show the development of German climate financing from budget funds as a whole and, as a part of this, the financing of adaptation-relevant projects from 2010 to 2017.
HUE-5: International finance for climate adaptation (from budget resources)

From 2010 to 2017, two lines show the development of German climate financing from budget funds as a whole and, as a part of this, the financing of adaptation-relevant projects. Both lines show a significantly increasing trend. In 2017, German climate financing amounted to 3.46 billion euros, of which 1.44 billion went to adaptation-relevant projects. The share of adaptation-relevant projects in German climate financing is shown with columns and has also increased significantly. In 2015 and 2016 it was more than 46 percent, in 2017 41.4 percent.

Source: BMZ (reporting according to EU-MMR-regulations)
 

The need for adaptation is a global challenge

In view of the global dimension of climate change and associated impacts, Germany has for years campaigned for wide-ranging international co-operation on adaptation efforts. The goal is to achieve joint generation of the European framework conditions for adaptation in developing countries with emerging economies and in European co-operative research projects. As far as the wider international environment is concerned, German activities take their cue from international processes and partnerships including the IPCC.

Developing countries are particularly affected by the adverse effects of climate change. Impacts have already materialised in terms of pronounced weather extremes and, for example, the deterioration of agricultural cultivation regimes. Owing to their economic and political circumstances, some of the countries affected suffer from having inadequate adaptation capacities. Providing support for developing countries in solidarity is a must, not least because – compared to industrialised countries and emerging economies – they are responsible for only a small proportion of greenhouse gas emissions which impact on the global climate.

Germany provides assistance with adaptation measures in developing countries within the framework of co-operation at a development- and climate-political level. In that light, Germany assists with designing and implementing national adaptation plans (NAPs) and adaptation objectives as embedded in the Nationally Determined Contributions (NDCs) under the international climate agreement signed in Paris. This assistance is provided, for example, via NDC partnerships. Between 80 and 90 % of the German contribution to international climate funding is made available by the Federal Ministry for Economic Cooperation and Development (BMZ). Further funding is made available by BMU predominantly within the framework of the International Climate Initiative (IKI). Other ministries contribute to projects by way of research partnerships. For her endeavour to balance the country’s national contributions, Germany takes her cue from the model of balancing mitigation and adaptation within the framework of international climate finance as laid down in the Paris Climate Agreement.

At the 2009 World Climate Conference in Copenhagen the industrialised countries gave an undertaking to mobilise, from 2020 onwards, funds in the amount of USD 100 billion from a variety of sources. At the 2015 World Climate Conference in Paris this commitment was reviewed and the target year was deferred 2025. A differentiation is made between financial contributions to multilateral programmes and bilateral development co-operation. As far as multilateral funding is concerned, several states contribute to international funds held in multilateral development banks (MDBs) and international organisations. In 2002 the Least Developed Countries Fund was created with a focus on adaptation. The Green Climate Fund (GCF) has been in operation since 2014; it endeavours to allocate funding in a 50:50 split between mitigation and adaptation. With 54 % of GCF funds awarded for adaptation, the GCF has exceeded its objective. In this way, it has been possible to improve the adaptability of approximately 310 million human beings. Germany contributed 750 million Euros towards the first replenishment of funds (pledged to contribute 1 billion USD). In the next replenishment phase, Germany is to contribute a further 1.5 billion Euros (approximately 1.69 billion USD). In 2008 the adaptation fund was created as part of the Kyoto Protocol. This fund will now also implement tasks arising from the Paris Climate Agreement. At the 2018 Climate Conference in Katowice, the BMU made a commitment to contribute 70 million Euros. Within the framework of bilateral funding for projects and programmes, Germany makes contributions to specific projects promoting carbon-poor and climate-resilient economic growth. Projects are implemented predominantly by a banking group consisting of Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) Ltd. and the KfW but also by private, civil-society and church sources of finance as well as political foundations in developing countries.

Apart from projects whose key objective is the adaptation to climate change, there are some projects on development co-operation which include a cross-sectional reference to climate change. For example, numerous projects are concerned with the objectives of fighting poverty, safeguarding food security and diversification of a country’s economic structure; these projects also address the adaptation to climate change. Linking sustainable development with adaptation to climate change enhances the effectiveness of public funds. However, it is a crucial prerequisite for approving an adaptation project for international climate funding that the adaptation objectives are phrased distinctly and explicitly and that specific measures are implemented in a way as to reduce the vulnerability of human or natural systems to impacts or risks of climate change, thus increasing their climate resilience. This includes measures addressing information, awareness-raising in legal, planning and programming respects, as well as implementation measures such as the conversion to water-saving irrigation systems, the cultivation of drought-resistant crops, the introduction of sustainable practices in fisheries or measures concerned with malaria control.

The sum total contributed by Germany towards international funding for climate protection in terms of mitigation, adaptation, forest and biodiversity measures from budgetary funds has increased from 471 million Euros in 2005 to 3.46 billion Euros in 2017. Since 2010 Germany has kept separate records of the proportion spent on international climate funding; it is therefore possible to state that this proportion has more than quadrupled from 355 million Euros in 2010 to 1.44 billion Euros in 2017. Likewise, the proportion of adaptation funding compared to overall international climate funding has increased; in 2017 it already amounted to – with 41.4 % – just short of half the overall funding. These contributions included projects with adaptation effects in the field of forest protection and conservation of biodiversity. Leaving those two elements aside, it is clear to see that already in 2017, Germany’s international contributions towards adaptation funding amounted to 1.21 billion Euros.

 

Objectives

Assisting particularly vulnerable developing countries in the adaptation to adverse impacts of climate change (DAS, ch. 4)

Providing appropriate, calculable and sustainable sources of finance [...] for the support of adaptation measures in developing countries (Copenhagen Accord 2009)