State of Finance for Adaptation and UNDP’s Strategy for Supporting countries in the Arab States

1. State of Finance for Adaptation andUNDP’s Strategy for Supporting countries in the Arab States Elie Kodsi Drylands Development Centre UNDP Environment and Energy Group Damascus, 15-16 September 2010

2. Costs of Mitigation and Adaptation in Developing Countries Copenhagen Accord per year by 2020 Costs of Adaptation (World Bank and UNFCCC, $billions) Source: EACC, WB 2010 US $100 billion

3. Diversity of schemes • Some operate at the international level • Others only available to domestic investors. • Four main categories: (i) public funds providing either grant or loan assistance; • (ii) Private funds providing either grant or loan assistance; • (iii) market-based instruments; • (iv) innovative financing instruments. Source: SEFI, New Energy Finance in Glemarec et al (2010)

4. Global Climate Finance Negotiations • UNFCCC negotiations continue to discuss reform of financial mechanism: • A possible new fund: Copenhagen Green Climate Fund (CGCF) to manage a “significant portion” of future climate finance in addition to GEF and AF • Creation of a new oversight system (possibly a Finance Board) under the Convention that may be involved in fund allocation and approval (for CGCF, GEF and AF projects) • Use of Low-emission, climate-resilient development strategies as the foundation for accessing and allocating finance • Increased provisions for direct access under all funds • Status of Discussions as of mid-2010: • Negotiations moving slowly--full deal in Cancun ruled out • Still much to be clarified over the CGCF and respective roles of GEF & AF • However, “fast start finance” ($30bn per year 2010-12) is flowing (65% along bilateral lines; some as part of GEF V and AF pledges)

5. COP Financial Mechanism Registry/Mitigation BILATERAL CC Adaptation BOARD ? Forestry & REDD Technology Matching Coordination Oversight MRV Capacity Buliding Adaptation Fund Copenhagen Green Climate Fund ? GEF Countries Receiving Climate Finance

6. GEF and the Kyoto Adaptation Fund GEF Assistance to Address Adaptation Secretariat services for the AFB provided by GEF on an interim basis. GEF Trust Fund UNFCCC climate change funds The Adaptation Fund Adaptation Fund (AF) Adaptation in developing country parties to KP NO GLOBAL BENEFITS Least Developed Country Fund (LDCF) (implementation of NAPAs) NO GLOBAL BENEFITS Special Climate Change Fund (SCCF) Top priority to Adaptation NO GLOBAL BENEFITS GEF Trust Fund Strategic Priority on Adaptation (SPA) adaptation action WITH GLOBAL BENEFITS

7. Modalities for Accessing The Kyoto Adaptation Fund Source: Accessing Resources from the Adaptation Fund, 2010

8. Status of Funding GEF/LDCF Pledges: $221m Funding Approvals: $135m (Only for LDC) Source of Funding Replenished Voluntarily Donor Contributions 2010-2014 Expectation $500m GovernanceGEF LDCF/SCCF Council GEF/SCCF Pledges: $148m Funding Approvals: $109m (For all non-annex 1 Parties) Source of Funding Replenished Voluntarily Donor Contributions 2010-2014 Expectation $500. GovernanceGEF LDCF/SCCF Council Kyoto/AF CER Sales: $156m Funding Approvals: $0 (For all Parties to Kyoto – non annex 1 to UNFCCC) Source of Funding CER Sales 2010-2014 Expectation $317-434m Governance AF Board (Parties)

9. Current UNDP Support to Countries in the Arab States

10. Where do we stand in the region? UNDP’s Adaptation Portfolio $13,3 million / $15 million in co-financing • Addressing priority climate hazards and adaptation needs

11. Sources of LDCF, SCCF and AF Funds Mobilized To-Date – Arab Regions • Egypt - $4m (SCCF) • Sudan - $3.3m (LDCF) • Morocco - $3m (GoJ) • Tunisia - $3m (GoJ) • Morocco - $300K (SPA) (part of a global community based adaptation project) • Jordan – $750K (SCCF) (part of a UNDP-GEF global cc health adaptation project executed by WHO) Others: Number of Enabling Projects (Nat Coms, CB2s etc)

12. Funding to be Mobilized (2010 onwards) SCCF: • Jordan – Treated waste water use $ 3.6 million; • Syria – Innovative finance for adaptation in the Badia steppe - $4.5 million; LDCF • Requests from Sudan and Yemen AF • Egypt – mariculture as coastal defense and livelihood diversification - $5.7 million • Requests from Lebanon, Sudan, Yemen and Djibouti

13. Key Challenges in Attracting Financing Assuming that international public finance commensurate with the Copenhagen Accord will be mobilized there are 3 key questions: • Finding ways to mobilize a variety of resources at scale How to attract, blend with, and catalyse, larger sources of public and private finance • How to assist countries to move towards low carbon climate resilient growth paths • How to deliver finance in a nationally defined and directed way where it is most needed Find ways to deliver finance at speed to where it is needed most

14. Emerging UNDP Support to Countries in the Arab States to Pursue Low Emission Climate Resilient Development

15. UNDP Approach For Assisting Countries Attract CC Finance • Raising finance and delivering finance go hand-in-hand (i.e cannot be dealt with separately) • A country-driven, multi-stakeholder framework to scale up cc finance to strengthen and advance national development priorities is required.

16. A New Development Paradigm: A country-driven, Multi-Stakeholder Climate Finance Framework Public and Private Sources of Funds (National and International Sources) Low Emissions, Climate Resilient Development Strategies Financial and Technical Support CC Platforms “NAMAs/NAPS” Implementation and Reporting Mechanisms This approach allows governments to put development at the heart of climate planning

17. 5 key steps to prepare a LCLRD Strategy Prepare comprehensive Low Carbon & Climate Change Resilient Roadmap • Assess Priority Climate Financing Needs • Assess existing financing options • Undertake cost-benefit analysis of priority options • Identify Financial flow requirements • Identify policy & financing options • Identify Mitigation & Adaptation Options • Identify priority M&A options through a multi-stakeholder consultative process • Prepare Climate Change Scenarios • Climate scenarios • Vulnerability scenarios • GHG emissions scenarios Develop Partnership & Coordination Structure

18. The project aims at improving MDG related service delivery through an integrated community development based approach. The key MDG areas that will be addressed by the project target four MDGoals related to poverty reduction, education,health and environment. These specifically include: i) poverty reduction through employment creation; ii) access to and quality of education; iii) integrated health services and IV) access to safe water and improved sanitation.. This approach will be conducted in 24 villages in the eastern region which was hit by a severe drought, the worst of the last fourty years. Six villages namely Khan Toman, Jafer Mansour and Mgheirat Shibli in Aleppo and Bsetien, Mueijil and Kabajeb in Deir Ezzor[1] will be targeted in the 1st phas [1] Refer to annex 4 Enhancing Climate Resilient Development Drylands Development Centre Arab States Programme

19. DDC-supported Intervention in Syria • The North-eastern Region in Syria lagging behind in terms of the MDGs and faces development challenges: lack of basic services and infrastructure, little investment and limited job opportunities, migration • It is home to 58.1% of the poor population • it has 42% of Syria’s cultivated area, is heavily dependent on agriculture and, therefore, is very sensitive to desertification and drought. • Moreover, the region has been more impoverished in the last few years as a result of severe drought. Two UN joint assessments conducted in 2008 and 2009 concluded that the drought is severe, the worst of the last 40 years and affected about one million people.

20. DDC-supported Intervention in Syria • The North-eastern Region in Syria has a major existing climate adaptation challenge, which climate change is likely to deepen. (Impact from climate is not a future concern, it is an immediate concern) • The Region’s adaptation challenge is inextricably linked with its development challenge: if people are well educated, have access to good basic services and have robust/diversified livelihoods they will be much less vulnerable to climate change. • Adaptation is essentially about development in a hostile climate or climate-resilient development

21. DDC-supported Intervention in Syria • National response: Integrated Community Development for scaling-up the MDGs in the North-eastern Region • Joint project Ministry of planning and UN agencies (UNDP, ILO, WFP, FAO, UNICEF, UNFPA) • Key MDGs targeted are related to poverty, education, health and environment. • DDC support seeks to build community resilience to drought through: 1) developing vocational and business skills among adults and youth for livelihood enhancement/diversification and 2) building the capacity of farmers to adopt appropriate land and water management practices

22. Syria - Lesson learned • A window of opportunity today: a chance to put in place nationally-owned programs that boost sustainable development and in doing so greatly improve the levels of climate adaptation • The work piloted in Syria can: • Serve as a baseline for mobilizing additional funding from international climate finance (this is on-going) • Feed into the development of Low Emissions, Climate Resilient Development Strategy (whether at the national or sub-national level)

24. For further information on adaptation funding and programming in the Arab States Region: Keti Chachibaia, Regional Technical Advisor- Adaptation- Arab States keti.chachibaia@undp.org Elie Kodsi, Regional Manager for Arab States, UNDP Drylands Development Centre, elie.kodsi@undp.org