With the Global South hoping COP29 can bring progress on the $215-387 bn per year needed for adaptation, we spoke to the head of the Adaptation Fund.
At international climate talks, discussions around adapting to the climate crisis have often taken a back seat to negotiations over how to reduce emissions. Though this imbalance arguably continues, the efforts of vulnerable countries have put adaptation more firmly on the agenda. At COP29 in Azerbaijan, negotiators from the Global South will again be pushing for progress on adaptation - especially on the question of funding, which currently falls many orders short of what is needed.
As COP29 gets underway, African Arguments interviewed Mikko Ollikainen, Head of the Adaptation Fund. Established in 2001 under the Kyoto Protocol of the UN Framework Convention on Climate Change (UNFCCC), the Fund has committed over $1.2 billion for climate change adaptation and resilience projects since 2010. Ollikainen spoke of his expectations from COP29, the adaptation finance needs of developing countries, and maladaptation.
The Adaptation Gap report released in 2023 estimated annual adaptation costs in developing countries to be $215-387 billion this decade. In the past, developed countries have consistently fallen short of meeting such needs. With climate finance a big theme at COP29, what would you consider a successful outcome?
Indeed the gap continues to grow, particularly with rising temperatures and worsening climate impacts. The need to significantly scale-up adaptation this decade to address rising impacts is becoming extremely urgent to avoid increasing costs of inaction. We see this directly in the Adaptation Fund where our pipeline of projects in development that are not yet funded has grown to about $500 million. Our Board has set a Resource Mobilisation goal of $300 million this year as well as an increased number of contributors to move in the direction of helping to meet this need and enable the Fund to continue supporting vulnerable countries and communities in their efforts to address climate impacts.
Many developed countries, and the US in particular, often stress the importance of mobilising private finance to meet climate finance needs of developing countries. What do you make of the push for private financing? Do you think it could cover some adaptation costs?
To bridge the adaptation finance gap, we need to employ different types of mechanisms and instruments. However, it is important to highlight the critical role of public and grant-based financing for many developing countries, including for SIDS [Small Island Developing States], LDCs [Least Developed Countries] and many African countries, given the context of their fiscal environment. The Adaptation Fund's focus is on providing grant-based finance for the most vulnerable, who are often within a context that it's not attractive for private funding, and it's important that no one is left behind in an adaptation economy equation.
The Adaptation Fund grant-based funding is also important in creating the enabling environment and catalysing adaptation action to unlocking private finance resources. The Fund's Innovation windows, in particular, promote climate adaptation innovation and private sector development with focus on Micro, Small and Medium Enterprises. It's also worth noting that the Adaptation Fund was originally set up with an innovative financing mechanism of a share of proceeds from the carbon markets under the Kyoto Protocol, and we very much look forward to finalising the operationalisation of the Article 6.4 of the Paris agreement in COP29 to enable more flows for adaptation funding.
I have heard that there are procedural hurdles in accessing adaptation finance and also delays in the disbursal of funds. How is the Adaptation Fund working to resolve such issues?
The Adaptation Fund has proven effective in delivering and channelling adaptation finance to vulnerable countries and communities with one of the fastest project cycles, and a strong focus on country ownership, and the most vulnerable. Our time to disbursal is often much more expedient. Further, we pioneered Direct Access to climate finance which enables developing countries to nominate their own national implementing entity to identify and develop projects, eliminating a level in between that would typically be served by a multilateral implementing entity. That said, we are constantly trying to make our processes smoother and quicker to both accreditation of implementing partners and approval and disbursal of project funds, and we have done so through a number of policy improvements over the years. Mutual fast track accreditations/re-accreditations is one example, and our streamlined process for smaller entities is another.
We also recently opened new funding modalities dedicated to locally-led adaptation (LLA), which aim to make funding adaptation more easily accessible to local actors, organisations and communities and ensure that they are empowered to lead adaptation planning and implementation.
What do you see as the main challenges facing the Adaptation Fund that are yet to be overcome?
Achieving predictable, sustainable and consistent funding from a variety of sources to meet the growing global adaptation needs we are facing, particularly among the most vulnerable. Meeting the climate challenge will require greater volumes of adaptation finance and a more strategic approach to investment. We hope that this COP gives strong signals to that effect and ensures adequate resources to the Adaptation Fund in the coming years.
At IPCC-61 held between July-August, some Global South countries like Kenya, Algeria and India raised concerns about the term "maladaptation". They said it is "mitigation-centric" given that the definition in IPCC's AR6 report includes a constraint on emissions. This would be a problem because many adaptation measures like building cyclone shelters, for example, requires some room for emissions. Other experts also say that the assumption of perfect foresight in being able to assess what is and isn't maladaptation is problematic. What are your thoughts on maladaptation?
In adaptation projects it's important to screen for maladaptation but by that we primarily mean adaptation strategies or measures that can actually make people or communities even more vulnerable to climate change than they were before. Each adaptation project is different and we need to understand the local context, and this is why our thorough stakeholder engagement process and monitoring and evaluation as well as the Adaptation Fund network of civil society organisations help ensure our projects are effective and delivered to the vulnerable.
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Has the Adaptation Fund classified any project or any part of any project as "maladaptation"? If yes, could you provide a number on how many there are and what the nature of such projects is?
Our thorough technical review process screens for risks of maladaptation and asks detailed questions to ensure that the project deploys the most effective measures for the context and ones that are sustainable in the long term. For example, if a project that attempts to manage droughts proposes tapping into aquifers, it is important to understand the replenishment of the aquifer to ensure that the water provision will be sustainable and that we are not increasing dependency on a source of water that may be depleted quickly.
In adaptation literature, irrigation is often classified as "maladaptation". But irrigation has played in securing farmer livelihoods, especially in poorer, agriculture-dependent countries. Your views on this?
Adaptation measures are targeted to the local adaptation needs and vary per country and situation. In drought-prone areas, water security is paramount and measures such as rooftop water harvesting, drip irrigation and downhill water filtration systems, just as a few examples, have shown to be quite effective.
Rishika Pardikar is a freelance environment reporter covering science, law, and policy.
