Development-Oriented Approach to Climate Risk Management Milen Dyoulgerov Disaster Management and Adaptation Coordi

1. Development-Oriented Approach to Climate Risk Management Milen Dyoulgerov Disaster Management and AdaptationCoordinator GFDRR September 21, 2010

2. The climate is already changing • Adaptation to these changes in the long term starts with improved current climate and disaster risk management capacity • Approaching climate change adaptation (CCA) and disaster risk reduction (DRR) work as a continuum, as do our developing country partners • CCA analysis and measures in DRR interventions is increasingly a basic issue of due diligence, while CCA investments that do not address current climate risks could fall short of meeting countries’ development needs

3. Linking Disaster Risk Reduction and Climate Change Adaptation Most climate change impacts, especially in the short to medium term, will materialize through variability and extremes Reducing disaster risk is thus a no-regrets CCA strategy • DRR and CCA should largely be managed as one integrated agenda: • Climate Risk Management

4. Some terminology (cont.)…. • Climate Risk Management • treats economic development, DRR, and CCA as a continuum • considers both short- and long-term climate variability and risks in an integrated manner • focuses not only on avoiding adverse outcomes but also on maximizing opportunities in climate-sensitive sectors – e.g., farmer productivity • covers a broad range of potential actions, such as land use planning and zoning, financial instruments, infrastructure design and capacity building, climate and weather information systems, early-response systems, strategic diversification, dynamic resource-allocation rules, etc.

5. Climate Risk Management (CRM): How partner countries see it • most developing country partners rarely make a distinction between development assistance targeting current versus longer-term climate variability and risk • differentiation in financing modalities and sources can add confusion and deepen institutional capacity and coordination issues • most CASs/CPCs address DRR and CCA in conjunction, if at all • countries like the Maldives and Vietnam take leadership by adopting integrated national CRM strategies and platforms; other countries in the process of doing so Vietnam Current impact: ~1.5%GDP CC projections: 1 of 5 worst affected countries • National Disaster Risk Reduction platform for information sharing, institutional development, coordinated planning, sector work, and investments, including donor programs and aid, related to all aspects of climate risk management • Central government coordination mechanism at the Vice-minister level chaired by Ministry of Agriculture and Rural Development that brings together central and local governments, academia, NGO/IGOs, and donors.

6. Climate Risk Management: How we see It • The climate is already changing:from shifting seasonal patterns of precipitation and extreme weather events to unprecedented floods, droughts, and heat waves • adaptation to these changes in the long term starts with improved current climate and disaster risk management capacity • similarly, CCA investments should increase resilience to current climate variability while preparing for future shifts in climate conditions • From development perspective • integrating CCA analysis and measures in DRR interventions is increasingly becoming a basic issue of due diligence • CCA investments that do not simultaneously address current climate risks could fall short of meeting countries’ development needs • From operational perspective • shared analytical and methodological tools/approaches • common risk financing toolkit of policies and products • DRR often an entry point for CCA engagement • post-disaster reconstruction as an opportunity for climate-smart (re)development

7. Opportunities in recovery reduction of climate vulnerability to future hazards climate risks addressed in recovery plans Post Disaster Needs Assessment (PDNA) to guide disaster and climate resilient recovery planning estimates of the damages and losses in all social and economic sectors base for a comprehensive recovery and reconstruction strategy examples: Namibia, Bangladesh, Haiti, CAR, Myanmar, Cambodia, Lao PDR, Senegal, Burkina Faso… risk assessments as a basis for post-disaster land use planning and building codes examples: Yemen, Madagascar Climate Risk Management: How we see It

8. Climate Risk Management: How we see It • majority of Bank analytical and programming work on adaptation at both country and regional levels has been either initiated or co-financed by DRR resources as integrated CRM initiatives—a similar trend emerges with investment operations • CRM approach built in the PPCR country programs in Bangladesh, Zambia, Mozambique (among others), based on existing DRR and CCA analytical and capacity-building work • Climate Risk Financing advanced by Treasury, GFDRR, and Regions in an integrated manner to meet partner countries’ DRR and CCA needs Malawi Econ Vulnerability and Risk Assessment North Africa Adaptation Action Plans • assessing most threatening climate hazards, floods and droughts, followed by a probabilistic risk analysis and projection of economic impacts as a foundation for CRM capacity-building and investment • CRM AAA financed with both DRR and CCA dedicated funds to assess climate risks with 2030 horizon and propose adaptation and preparedness options for Alexandria, Casablanca, and Tunis Moldova Disaster and CRM project Moldova PDNA • to strengthen national Hydromet Service's ability to forecast severe weather and improve Moldova's capacity to prepare for and respond to climate disasters and future climate risks in the agriculture sector in particular • in the aftermath of extreme floods preceded by extreme draughts, a window of opportunity to build back better, incorporating climate-smart water resource management and infrastructure

9. Climate Risk Management: How we see It ICM interventions bring high economic returns • A GFDRR-WB Study on Economics of Hydro-meteorological Services in Central Asia : • Investment in information and knowledge: each € 100 spent in meteorological systems yields at least € 200 in avoided damages Source: World Bank.

10. Climate Risk Management (CRM): Changing nature of risk Climate Risk Management Risk Assessment • Risk Reduction • Risk Financing . Disaster Preparedness and Recovery Slow outset, long term structural shifts in everyday and in extensive risks • Added factors • temporal limitation • not to substitute for development financing • Added factors: • temporal • spatial • political economy • Added factors • temporal • political • political economy • intergeneration equity • Added factors • adaptive functions • political • political economy • intergeneration equity Added temporal and political risk dimensions Adaptive Risk Governance Options-based management and adaptive decision-making

11. The major developmental challenges and main drivers of underlying disaster risks are also the major determinants for adaptation action • weak urban governance, vulnerable rural livelihoods, and declining ecosystems, Climate Risks are changing • quantitative shifts, in frequency and scale of extreme events • qualitative shifts, in risk types and threshold states • spatial shifts, with countries’ risk profiles changing The approaches to managing these risk need to evolve • Integrated climate risk management approach as a development-enabling factor

12. From concepts to development practices • Strong methodological and operational base for integrating climate adaptation in national strategies as well as in the critical window of post-disaster recovery planning and operations, established at the global level in cooperation with the UN, RMDBs, and the EC • Building on needs and synergies in terms of geospatial and climate risk information, GFDRR and the Climate Change Team have initiated country adaptation profilesfor all Bank Regions -- an operational tool for practitioners for just-in-time reference information, to be later expanded with sector-specific climate risk guidance

13. Building on its strong partnership with the WBG Treasury and the Insurance Group, GFDRR is establishing a center of expertise for catastrophic risk financing and insurance for providing analytical and operational support • Recognizing Social protection as a critical component of climate risk management, GFDRR seed funding has enabled pioneering work on the social dimensions of climate change in Africa and is now supporting multi-country analysis on adaptation for the urban poor. • On-going work on results measurement and indicators

14. Helping Partners Stay Ahead Understand risks and priorities • Develop hazard and risk analysis, use improved climate data, adaptation needs assessments • Encourage a shift toward climate-resilient growth across all sectors • Mainstreaming in existing strategies ensures that objectives are met; use sectoral strategies to reach local governments and communities; build on existing platforms • Provide budget allocation for: • Climate-resilient public infrastructure (e.g., roads, dams) • Preparedness and emergency response to extreme events • Information to help citizens in their everyday decisions (e.g., early warning systems, seasonal forecasts) • R&D and extension services in agriculture • Provide for unforeseen events; create contingency funds, sign contingent loans, and/or buy insurance for emergency responses to climatic disasters Design policies Support line ministries Plan ahead with contingency funds

15. Thank You! • For tools and information please visitus online: • www.worldbank.org/gfdrr • www.worldbank.org/climatechange • www.worldbank.org/cif