Climate change adaptation in the water sector: financial issues
Water and climate change adaptation, 11:
This perspective document discusses the economic and financial issues of adaptation to climate change in the water sector. It inventories and analyses the (inter)national adaptation funding instruments presently available and demonstrates that projected needs cannot be met with these instruments alone, while an overarching harmonized strategic financial framework, without which the benefits for the global environmental environment will remain suboptimal, is still lacking. The document therefore describes what other options for financing could be developed.
Based on United Nations Conventions and Trust Funds, World Bank Adaptation Funds, new bilateral funds as well as other funding sources available for financing adaptation to climate change (such as public investments, private investments and insurance arrangements), the document looks forward to enhance investment and financial flows to address climate change adaptation in the future and risk transfer from localities to regional and global insurance and capital markets through insurance. It calls for the following needs to be addressed: (i) to scale up efforts and to act with greater urgency; (ii) policy coherence; (iii) independent coordination; and (iv) North-South accord in carrying out measures for global environmental benefit.