ECO wonders if developed countries still remember their COP26 promise to double their annual adaptation finance by 2025 (compared to 2019.) The recently published OECD report shows that adaptation finance flows have declined in 2021 by 14%. Isn’t that alarming? The UNEP adaptation gap report confirms this drop in adaptation finance and reveals how drastically the adaptation finance gap is widening. Meanwhile, adaptation needs and costs far exceed previous estimates. One telling example is that Africa will need a five to ten fold increase in adaptation finance flows to over $100 billion per year by 2035.
This widening gap has massive implications for enabling vulnerable countries, peoples, and communities to adapt to the changing climate and confronts them with ever-growing losses and damages. ECO is extremely worried about these recently revealed trends, and that developed countries have so far not produced any credible plans for achieving the doubling of adaptation finance they committed to in Glasgow.
Let ECO remind you that it is not only the numbers that matter, but also the quality of finance that’s being offered. The time of channeling the majority of adaptation finance, especially for Africa, as debt or loans is over. Adaptation finance must focus on the needs of those communities that are most vulnerable to climate change. It must be directly accessible to developing countries and it must be aligned with human rights and contribute to gender equality. There is a big need to increase grant-based adaptation finance for concrete local adaptation measures that increase the resilience of people and communities most vulnerable to the climate crisis.
ECO has heard a number of developed countries in negotiation rooms generally agreeing to those needs. However, ECO would like to remind them that words must be followed by action. And there is a very easy way to do so: contributing to the Adaptation Fund!
The Adaptation Fund fulfils all the conditions for high quality adaptation finance. But somehow developed countries seem to have forgotten about the Adaptation Fund at COP28. ECO wonders if some developed countries felt that making (often rather symbolic) pledges to the Loss and Damage Fund may distract attention away from the looming adaptation finance gap.
ECO is seriously concerned that the Adaptation Fund will not even get close to its minimum resource mobilization target of 300 million USD. This target is only a political compromise and does not even come close to the actual needs and demands for Adaptation Fund projects.
Because of the very limited finance and lack of predictability, the Adaptation Fund cannot take the necessary steps needed to significantly scale up its action and is unable to play the very important role that it actually should assume. It is not at all clear when and how much resources will be generated through the 5% share of the proceeds from the market mechanism for emission reductions under Article 6. The timeframe and generated funding of this mechanism are complex and still uncertain. In the short to medium term, the Adaptation Fund thus heavily depends on contributions from donor countries. Developed countries, you need to step up for adaptation finance and the Adaptation Fund with significant and impactful multi-year contributions! You need to prove that your promises are not just empty words. If you fail to provide urgently needed adaptation finance, the losses and damages we are facing in the rapidly intensifying climate crisis will dramatically increase.