The financial cost of climate change adaptation.

Climate change effects like heatwaves, floods, wildfires sea level rise, and others, all put additional financial burden on countries. They bring massive disruptions to the lives of citizens that only governments have the authority and capacity to address by formulating widespread or national responses, mainly through control over taxes and other forms of national resources.

With heatwaves, a government has to consider outfitting schools, public buses, hospitals and other public spaces with air conditioners or cooling systems. With floods, wildfires and sea levels rise a government is usually engaged in citizens’ rescue and relocation, including providing shelter and food for the needy, usually for an indefinite period of time. All this require effective coordination and a large amount of expenditure. Subsequent to all of this, a government would normally be engaging in climate awareness campaigns, the installation of early warning systems, repairing infrastructures including installing flood prevention drainages, enhancing fire fighting and rescue capabilities, issuing subsidies and loans to some companies and farmers in an effort to keep them in business, giving some regular subsidy or social assistance to the unemployed and many more activities that require government spending. Wealthy countries would handle the expenditures listed above with much ease but for developing countries the task would become extremely challenging or impossible.

According to an article by the World Resources Institute, wri.org, “the UNEP [United Nations Environmental Programme], Adaptation Finance Gap Report, estimates that developing countries need between $215 and $387 billion per year by 2030” to reasonably adapt themselves to climate change. The article went on to argue that the “Climate Policy Initiative (CPI) estimates that $68 billion was spent around the world on adaptation on average between 2021 and 2022” and that “according to OECD, developed countries delivered $32.4 billion in adaptation finance to developing nations in 2022.” It is clear that an extraordinary amount of financing will be necessary, to satisfactorily adapt the world to the new climate conditions.

The United Nations, (UN), itself is very much aware of the exorbitant amount of financing that will be required, to adapt all nations to the new climate effects. In an article titled, “what is climate change?”, un.org, it argues that “we can pay the bill now , or pay dearly in the future,” and in addressing the world further, it contends, “one critical step is for developed countries to support developing countries.”

The United Nations Framework Convention on Climate Change, (UNFCCC), unfccc.int, indicates very clearly that “the Paris Agreement provides a framework for financial, technical and capacity building support for those countries who need it.” Which essentially means that developed countries are expected and encouraged to provide financial assistance, technological necessities and the required training to assist developing countries to adapt. The UN envisions the whole world supporting each other and fighting together to adapt to a common enemy, the climate crisis.

One of the important outcomes of the UN’s Conference of the Parties meeting in Baku, Azerbaijan in 2023, (COP29), was the financial offer the Developed countries gave to their Developing counterparts. Jody-Ann Jue Xuan Wang writing about “Cop29 climate finance deal” in Theconversation.com, says “rich countries agreed to take the lead in paying US$300 billion a year to the poorest nations by 2035 from a varirty of financial sources (public, private, between countries, and across multilateral sources like development banks,” but the Developing countries were not happy with the offer. She goes on to argue that the offer “is less than a quarter of what developing countries asked for, and not in the form of the no-strings-attached grants money that they need.” She draws reference to the fact that the “Developed countries are responsible for most of the greenhouse gas emissions that are heating earth to dangerous levels.” Developed countries have agreed to help pay for Developing countries climate adaptation, but there is still no agreement, between the two, as to the nature of and how much they should pay.