Mobilizing Development Finance for Strategic and Scaled-up Investment in Climate Adaptation
Addressing the substantial gap between current levels of financing for adaptation and what developing countries require to increase their resilience to climate change is critical to achieving the Paris Agreement’s adaptation goal.
Multilateral development banks (MDBs) have pledged to help address this gap by scaling up their provision of climate finance and by better integrating climate change adaptation considerations into their development finance portfolios. Mainstreaming adaptation considerations into MDB investments would increase the financing available to build resilience to climate change. At the same time, there is a need to ensure that these investments are supporting adaptation actions prioritized by developing country governments.
The “Mobilizing Development Finance for Adaptation” aims to generate the knowledge needed to advance the mainstreaming of adaptation in development finance strategies. This will help MDBs scale up investments in actions that are strongly aligned with country-defined adaptation priorities. It seeks to identify barriers—both within MDBs and developing countries—that limit the use of development financing to address national adaptation priorities and opportunities to overcome these constraints.
Through case study research in Kenya, Nepal and Peru, the research project is examining three key questions:
- What approaches are MDBs taking to mainstream adaptation in their development finance portfolios and overcome encountered challenges?
- How can developing countries better attract MDB development finance that addresses and is aligned with the adaptation priorities arising from their National Adaptation Plan and/or Nationally Determined Contribution processes?
- What is the potential to use innovative finance instruments to scale up financing for adaptation?
IISD is undertaking this research project in collaboration with the African Centre for Technology Studies based in Kenya, the Prakriti Resources Centre based in Nepal, and Libélula based in Peru.
Libélula Case Studies
These three case studies from Peru examine efforts to increase finance for adaptation through multilateral development banks’ development finance portfolios, national adaptation financing strategies, and the use of payments for ecosystems services.
Prakriti Resources Centre | Mainstreaming Adaptation in Development Finance in Multilateral Development Banks
This case study explores challenges to scaling up finance for adaptation across different contexts and opportunities to overcome these constraints.
Prakriti Resources Centre | Strengthening National Strategies for Financing Adaptation in Nepal
This case study explores Nepal’s perspectives and needs in regard to increasing the volume and quality of finance for adaptation.
Prakriti Resources Centre | Innovative Financial Instruments for Adaptation
This case study provides the learning on scaling up finance for adaptation that emerged through the public and private sector collaboration to enhance food security through promoting climate resilient agriculture in Nepal.
NAP Global Network Blog | Unpacking Gender-Responsive Adaptation Finance: Key issues and the way forward
As finance for climate change adaptation is scaled up, there is a real opportunity to promote human rights and gender equality in line with the ambitions of the Paris Agreement.
Prakriti Resources Centre Blog | MDB Investment Can Support Climate-Resilient COVID-19 Recovery in Developing Countries
MDBs and the Government of Nepal can work together to factor climate adaptation needs in COVID-19 recovery investments.
African Centre for Technology Studies Blog | Fostering Greater Demand for Multilateral Development Bank Financing for Adaptation: Insights from developing countries
Initial research findings in Kenya, Nepal, and Peru highlight that MDB’s efforts to close the adaptation finance gap require input from developing country governments and alignment with nationally determined adaptation priorities.
Innovative Financial Instruments and Their Potential to Finance Climate Change Adaptation in Developing Countries
This report explores the range of innovative financial instruments that could be used to scale up financing for adaptation and lessons for their use in developing countries.
Multilateral Development Bank Efforts to Mainstream Climate Adaptation
The paper explores the progress of four MDBs in mainstreaming climate adaptation in their developing country portfolios, specifically looking at experiences in Kenya, Nepal, and Peru.
Preparing Financing Strategies for Adaptation: Emerging good practices
Amid a growing interest in the preparation of financing strategies for adaptation, new research aims to unpack what the scope of these strategies should entail, what constitutes good practices for their development, and whether these strategies are truly effective.
The Landscape of Financing Strategies for Adaptation in Developing Countries
Draws insights from publicly available financing strategies for adaptation in developing countries and presents emerging lessons for their development.
Filling the Gap: A review of Multilateral Development Banks' efforts to scale up financing for climate adaptation
This report reviews the challenges of and opportunities for scaling up Multilateral Development Banks' financing for adaptation in developing countries and aligning these efforts with the Paris Agreement.
You might also be interested in
Creating Sustainable Reform
IISD collaborates with governments, international institutions, academics, and civil society to propose and support reform in international investment treaties, laws and policies. We are leading the way on global investor-state dispute settlement reform.
NAP Global Network
Supporting developing countries to accelerate climate change adaptation efforts around the world.
Trade and Climate Change
IISD project on trade and climate change
Task Force for a Resilient Recovery
With ideas from Canada and around the world, our Task Force aims for a resilient recovery—one that delivers good jobs, is positive for the environment, and addresses inequality.