Oxfam report examining international climate change adaptation funding and delivery in Nepal.
The report takes stock of climate change adaptation finance committed to Nepal from public sources of international finance during the period 2009 to 2012. The paper begins with an extensive look at the scope, methodology, and limitations of the study, which included the use of the Organisation for Economic Co-operation and Development (OECD) Development Assistance Committee Creditor Reporting System (DAC CRS) database as it’s primary information source. Semi-structured interviews with government officials were also conducted. The paper then empirically examines the climate change adaptation funding environment in Nepal, looking at the total levels of funding, and the different types of projects, fund sources, financial instruments, and recipients involved. Next, policy, institutions, governance, and fund flow mechanisms are discussed, before climate fund flows are investigated in more depth using three adaptation project case studies.
The key conclusions highlighted by the study are that:
Only 45.79 per cent of the total financial donor commitments classified as adaptation relevant by the Rio Markings used were found to be related to climate change adaptation either in part or full, raising questions about the current utility of Rio Markings. This requires further research.
Only 2.6 per cent of adaptation funding in Nepal comes from mechanisms within the UNFCCC regime.
While almost 70 per cent of funding goes directly through the Nepalese government, there are questions over government resource management capacities and the extent of donor influence over major projects.
Sectoral distribution of funds is highly unbalanced; while both forests and biodiversity, and urban settlement and infrastructure are both identified as priority areas, the former receives 44.36 per cent of the funding available compared to just 0.01 per cent for the latter.
Mapping of finance flows indicates that donors and development partners have been pursuing conventional assistance models for many years. It would be beneficial to explore new, more innovative models.
Since projects examined in this study were in their initial staging, further research is required to assess the Nepal’s climate change policy stating that 80 per cent of climate finance must be allocated at grassroots level. * Multiple stakeholder coordination committee are causing confusion among ministries and implementing agencies. Streamlining this process is potentially beneficial.
There is a need for internationally agreed criteria to define and transparently track climate finance.