Financing Climate Change Adaptation in Transboundary Basins

7 Financing Climate Change Adaptation in Transboundary Basins TABLE 1.3. RBO Challenges and Opportunities in Raising Climate Financing Challenges Opportunities • Uncertainty about the transboundary scope and nature of cli- mate impacts. • Coordination, integration, and alignment of basin planning and implementation with national, regional, and local planning and priorities. This can be particularly acute in large basins with many countries and delicate diplomatic relationships. • Limited resources and difficulties in allocating funds to and through a multicountry institution. • While the economic returns of large, multipurpose projects may be significant, indirect benefits and public good benefits do not necessarily translate into direct revenue streams that can sustain these investments. a • Options for funding to RBOs and basins are limited when com- pared with sovereign states by criteria and rules of funding institutions. • RBOs may lack revenue streams or the required legal personal- ity to qualify as a borrower for loans. • Legal status may affect RBOs’ ability to receive funds on behalf of the countries, especially accessing concessional finance. • Given limited availability of climate finance, there is a risk that RBO-generated projects may be seen as “competition” by national Institutions. • Climate information systems increase as countries share resources and capacity through basin initiatives. • Transboundary cooperation can improve coordination of measures at the river, lake basin, or aquifer levels, thereby enhancing impacts. • Strategic use of funding over related geographic and thematic areas creates greater efficiency and effectiveness when resources are limited. • Negative impacts on other riparian countries and maladaptation from unilateral measures can be avoided or mitigated. • Cooperative management of transboundary basins addresses chal- lenges that can provide widespread and exponential benefits to the region and beyond, providing an important public good. This is partic- ularly true in the case of adaptation and resilience building, in which addressing the cause is a shared responsibility and the harms avoided become benefits to all. a • The public good benefits position transboundary initiatives and proj- ects for concessional public finance, because they demonstrate char- acteristics that concessional financiers consider most bankable. a • Transboundary basin projects and resources can be used to comple- ment national efforts and limited RBO budgets. • The geographic scope of basin-level planning, implementation, and monitoring aligns logically with the geographic scope of climate impacts, and is therefore well suited to understanding the risks and finding potential solutions. Note: RBO = river basin organization. a. SIWI 2007. • Enhance monitoring, data collection, and sharing • Strengthen capacity on development of climate change adaptation strategies and plans • Improve outreach of MRC products on climate change and adaptation Financing Mechanisms Although the MRC Basket Fund will implement the MASAP, the MRC will further identify and prepare joint projects on transboundary and gender-sensitive adaptation to address climate change issues in sensitive hotspots that need urgent actions between two or more member countries. The joint projects will then be further submitted for funding and implementation support among development partners as well as climate change finance institutions. Source: Timmerman, et al. 2014. BOX 1.1. continued