Despite the growing acknowledgement of the importance of climate adaptation in the Global South, adaptation finance still receives unequal treatment in the climate action financing portfolio, especially compared to mitigation finance. The importance of adaptation, therefore, needs to be continuously reiterated in various forums. While the net-zero target years are in the far distance and lag far behind the intensifying climate impacts, it is becoming increasingly crucial for the Global South, bearing the brunt of the climate crisis, to adapt or build resilience. The 2024 Adaptation Gap Report reveals that the global annual financial gap for adaptation is in the range of US$215-387 billion annually, contrasting with the US$28 billion mobilised till 2022. This persistent gap stems from how adaptation is largely perceived as a “public good”, wherein investments would yield low economic returns on investment. This perception fails to account for the far-reaching social rate of return associated with adaptation projects, which include safeguarding communities, reducing disaster recovery costs, and bolstering long-term economic resilience. A higher adaptive capacity increases community resilience and, thus, reduces loss and damage, which is a fact hardly acknowledged by the market framework, leading to grave market failures.
Leveraging Philanthropy to Strengthen Climate Resilience (Nilanjan Ghosh, Sharon Sarah Thawaney – Observer Research Foundation)
Related articles
