Adaptation

Climate change affects us all. For example, in the next few decades London will have to make considerable investments in its future, ranging from the building of stronger flood defences, larger sewer systems and the provision of air conditioning for the London Underground. This is as a result of past emissions and those which will occur in the coming few years. However, the challenges in poor countries will be much more severe than those faced by rich countries. The great inequity of climate change is that those least responsible for the present stocks of carbon in the atmosphere are those hit the hardest. Climate change has the potential to threaten all aspects of the development agenda, potentially increasing poverty and hunger levels, creating more health threats, and forcing populations to migrate and relocate. In some countries, as we have described above, some of the effects are already visible.

As global temperatures increase, all countries will need to adapt to limit the human, economic and social impacts of climate change. Even the most aggressive stabilization targets being discussed imply acceptance of a global average temperature rise of 1°C to 3°C. This will lead both to more frequent and severe climate-related disasters (including droughts, flooding and storms) and to longer-term stresses (including changing rainfall patterns, ecosystem degradation, reduced biodiversity and higher sea levels).

These changes will affect poorer countries disproportionately: not only are they typically reliant on climate-sensitive industries such as agriculture and forestry, but poverty, poor health and limited capacity and resources to adapt increase their vulnerability.

The best form of adaptation is development itself: it leads to more diversified economies, stronger and more resilient human capital, and greater flexibility in the population. And adaptation should be seen as development in a more hostile climate. Thus, it is a profound mistake to see adaptation as somehow a different activity from development.

Just as adaptation planning needs to be integrated within development plans and strategies, so adaptation funding should be integrated within development spending at regional, national and local levels. This applies to overseas development assistance (ODA) as well. ODA should be enhanced for adaptation and new parallel processes should be avoided. Support should be for national development plans, reflecting overall national priorities. This would keep down both transaction costs imposed on developing countries (by reducing the range of different institutions, people and systems governments need to deal with) and the financial costs of creating and managing a new international mechanism.

The extra costs that climate change will imply for reaching development goals are not small. The United Nations Development Programme (UNDP) in its Human Development Report published in late 2007 estimated an extra US$86 billion per annum (by 2015) to reach the Millennium Development Goals (UNDP, 2007). By 2020, this would be likely to be of the order of an extra US$100 billion (and that is roughly the level of ODA today). This increases the importance of delivery on the promises of aid from rich countries at Monterrey in 2002 and Gleneagles in 2005. The arguments for 0.7 per cent of GNP as development aid from rich countries by 2015 were very powerful when they were made in 2002 and 2005; in the context of climate change, they are overwhelming. The developed world must recognize that the development agenda is now much more costly than anticipated 10 to 15 years ago and raise the target to around 1 per cent of GNP per annum.

A dedicated source of additional finance would provide confidence for poorer countries that resources for the extra costs adaptation requires would be both predictable and additional to other aid commitments. As nations and regions move towards cap-and-trade systems, auctioning of emissions allowances stands to generate substantial new revenue streams, as would revenues from carbon taxes on, for example, aviation. Diverting some of this revenue to finance adaptation in developing countries would provide some reliability for developing countries and enhance the acceptability in developed countries of these measures.

Adaptation, like development itself, requires economy-wide planning and regional cooperation and therefore requires the involvement of all parts of government. While environment ministries will play a crucial role, the challenge of adaptation must be taken on by heads of state and their finance and economic ministries. There is also a role for international financial institutions, including the World Bank and the International Monetary Fund (IMF), to monitor, report on and, where necessary, facilitate non-financial aid such as access to insurance, technology, information and other market-based facilities. Disaster relief and new more climate-resistant crops and technologies will require action at international level.

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