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National Institutional Arrangements for Climate Change Action

Mitigation and Adaptation

Luis Gomez-Echeverri International Institute for Applied Systems Analysis (IIASA) for sustained capacity building in support of international climate change negotiations pour un renforcement durable des capacités en appui aux négociations internationales sur les changements climatiques

Focusing on Local Institutions and Governance Why the Urgency

      Mainstreaming of climate change into development strategies will be difficult if not impossible without strong local institutions and able The promise of new wave of funding - but success will directly depend on mechanisms/institutions in place or to be in place at the national/local level Success of mitigation funding entities and adaptation activities depends on ability to clearly assess challenges and opportunities and strategies to address them optimally in line with local needs and circumstances Questions that arise at global level - how to identify eligible activities and how to allocate, disburse, manage, monitor, and evaluate – also come up at the national level but with added complexity Several countries taking initiative to establish national funding entities to tap resources – and many have long established arrangements for dealing with climate change but many may need serious overhaul - big capacity development challenge ahead Urgent need to shift attention to capacity building discussion - from building capacities of accredited entities to building broader local capacities to assess, formulate strategies, and manage climate change programs at local level

Current Institutional Landscape: Very Diverse but There are some common features

     Very few countries have established national institutions fully dedicated to addressing climate change (both mitigation and adaptation) In most countries it is the Ministry of Environment that is designated to help in (coordination?) implementation of climate change activities In many countries climate change is perceived as environmental problem and thus difficult to establish coordination across sectoral ministries Narrow institutional mandates shaped by interest to obtain funding rather than broader climate change agenda that needs to be mainstreamed into development Coordination mechanisms are weak or non-existent – power or legal mandate is absent in most countries

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Current Governance Challenges Common Trends and Problems to Addres(1)

Weak institutional structures to manage climate change Lack of clarity of functions of climate change governance Perceived lack of real priority for climate change – often driven solely by funding interest which in some cases distorting national priorities Little capacity to mainstream climate change into dev strategies – major gaps between action taken and national policies and strategies where they exist Weak structures to mobilize, capture and manage funding Weak coordination at national level

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Current Governance Challenges Common Trends and Problems to Address (2)

Proliferation of funds with diverse administrative and other procedures creating major burden and diverting resources from other key priorities Very few funding efforts and other support for capacity building Weak monitoring and evaluation capacity and thus performance evaluation is weak Weak capacities in key and complex areas crucial for managing climate change actions Tendency to create new institutions to respond to demands of new funds with complex procedures

The Case for Strong National Institutions and Funding Entities (1)

    A focus on strengthening national institutions could help address interest of developing countries to deal with climate change within context of their development Potential for transition to new model with greater devolution and sense of ownership Timely transition is good news for climate change and development:  For development: easier to mainstream into development priorities of countries  For climate change: will help countries feel as legitimate partners of global effort Magnitude of climate change needs can not be fully addressed by UNFCCC thus need for leveraging other funds (domestic and global) where local institutions will play key role 6

The Case for Strong National Institutions and Funding Entities (2)

 National institutions/funding entities are the ones best placed to ensure that investments are mainstreamed/ integrated into development  National institutions/funding entities are best placed to sort out different needs and match them to the best existing instruments  Role of national funding entities and institutions as intermediaries vis-à-vis global mechanism and helping identify eligible activities and coordinate implementing entities  Magnitude of climate change needs can not be fully addressed by UNFCCC thus need for leveraging other funds 7

In the area of Finance -Many Relying on International Institutions Others creating their own National Funding Entities (Partial Indicative List)

Funding Entity Purpose

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Amazon Fund – Brazil

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Bangladesh Climate Change Resilience Fund Brazil Nat. Fund CC China CDM Fund – CDMF Ecuador Yasuni Trust Fund Guyana REDD Invest Fund Indonesia CC Trust Fund Maldives CC Trust Fund

• To combat deforestation and promote sustainable development in Amazon • To help implementation climate change action plan – particularly vulnerable communities • To support broad range mitigation adaptation • To support climate change action plan • To support low carbon economy and forests • To protect nat. forest and promote low carbon • To mainstream and align CC to development • To strengthen nat. capacity thru pilot program

• Oversight • Financial Sup. • Standard Set.

National Skills Required Similar to Any Finance but Some More Complex and New

• Accountability Helping ensure mainstreaming to develop.

Helping establish/manage perform criteria Establishing monitor. & review systems Receiving/managing funds from global funding mechanisms w/ different demands Managing the program cycle of spec funds Leveraging additional CC resources Developing relevant eligibility criteria Ensuring standards aligned to nat priorities Performance reporting different & complex Capacities for maintaining registers and reporting to global entities

Conclusions

      Greater focus needed at climate change negotiations on resources and other needs for strengthening local governance and institutions in developing countries Potential for exciting new era of global cooperation on climate change with greater sense of local ownership and mainstreaming into development strategies if it is done right – bringing good news to both development and climate change Success of global cooperation and finance on climate change inextricably linked to strong local arrangements Countries with strong local institutions and clear climate change strategies are posed to contribute and benefit the most in fight on climate change New and additional funding prospects are good news but will pose huge capacity development challenge in developing countries that needs to be addressed and properly funded (fast-start-financing) International institutions will continue to play an important BUT DIFFERENT role creating bridges where local institutions not yet established or weak - building capacities and providing technical assistance 10