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Climate change and development cooperation Joyeeta Gupta Climate change and development cooperation Joyeeta Gupta

Messages § Development and climate change are closely linked; § However, the politics in Messages § Development and climate change are closely linked; § However, the politics in both arenas are highly charged on a North -South basis; § Linking climate change to development cooperation is possible, but mainstreaming is a problem. 2

Climate change and development § Mitigation • Development generally coupled with increased emissions; wise Climate change and development § Mitigation • Development generally coupled with increased emissions; wise policy can change that especially in sectors that are less productive and less efficient. Beyond that there are trade-offs • Mitigation can have ancillary benefits for development § Adaptation • Development can exacerbate adaptation through (mal) development • Development may have synergies with enhancing resilience • Adaptation activities can have ancillary benefits for development 6

The Evolution of the Right to Development 7 The Evolution of the Right to Development 7

Global governance: The evolution of the 0. 7% target 8 Global governance: The evolution of the 0. 7% target 8

Development cooperation § The Right to Development: • Accepted but under-emphasized § The 0. Development cooperation § The Right to Development: • Accepted but under-emphasized § The 0. 7 percent target: • Accepted, emphasized but not achieved § The link between the right to development and the 0. 7 percent target: • Contested § The MDGs and development cooperation: • New emphasis on achieving MDGs; but resources have to double if these are to be achieved. 9

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Development and development cooperation § Donors have had multiple objectives; § Delivery was often Development and development cooperation § Donors have had multiple objectives; § Delivery was often based on simple theoretical formulae § Aid recipient do not respond in predictable manners (e. g. conditionality); § Aid evaluation through quantitative indicators is questionable § Aid coordination has been donor driven. 11

Challenges in the aid process Donor recipient process Donor: Partner: decision-making, instrumental, planned Poor Challenges in the aid process Donor recipient process Donor: Partner: decision-making, instrumental, planned Poor governance Substitution effect Policy substitution Mismatch between priorities and partners Poor diagnosis Technical assistance Administrative burden 12

Development and Development Cooperation § Lessons from aid: • • • Goal: broaden objective Development and Development Cooperation § Lessons from aid: • • • Goal: broaden objective Nature of aid: Not necessarily catalytic Indicators: not just macro, but also micro Aid aligned to country type Aid should be demand driven and not lead to distortions: Not conditional Form of assistance should match need Aid to NGOs subject to caveats Quantity of aid: avoid dependency Balanced aid: poor and other sectors Donors need to take partnership seriously 13

Development and Development Cooperation § Lessons from aid: • • • Goal: broaden objective Development and Development Cooperation § Lessons from aid: • • • Goal: broaden objective Nature of aid: Not necessarily catalytic Indicators: not just macro, but also micro Aid aligned to country type Aid should be demand driven and not lead to distortions: Not conditional Form of assistance should match need Aid to NGOs subject to caveats Quantity of aid: avoid dependency Balanced aid: poor and other sectors Donors need to take partnership seriously 14

Linking climate change to other issues 15 Linking climate change to other issues 15

Climate change: Classical North-South issue § Formal divisions in Convention that both recognizes differences Climate change: Classical North-South issue § Formal divisions in Convention that both recognizes differences and fosters differences § Structural differences: • In emission levels between average Northern and average Southern country especially in the past – and this is the most serious determining factor for climate impacts until 2050. • If emission levels are to be kept within safe levels – the world budget for the 21 st century is over by 2032. • Impacts more severe in the South – both location wise; and because vulnerability is the greatest. 16

Climate change: The North-South deal Conditional leadership Leadership paradigm Pollution N N S EU Climate change: The North-South deal Conditional leadership Leadership paradigm Pollution N N S EU US S S Development Inverted U-curve may be a zig-zag curve Leadership competition Leadership sans US CEITS US JSCa. NZ EU S N helps S via CDM US N mainstreams cc help in development cooperation 17

The context of the North-South deal § 1992: North reduces emissions and helps developing The context of the North-South deal § 1992: North reduces emissions and helps developing countries (tech transfer and aid) with new and additional resources (above existing aid) § 1997: North reduces emissions partly via help to developing countries (new and additional? ) § 1997: Adaptation funding comes from a tax on North-South cooperation § 2007: North reduces emissions partly via help and climate change is mainstreamed in ODA 18

CDM and ODA Ideological level Organization level Project level + ODA leverages SD; synergy CDM and ODA Ideological level Organization level Project level + ODA leverages SD; synergy - ODA diverted + ODA helps cap. building esp. in poorest countries; - ODA diverted from DC priorities to help IC purchases - ODA subsidizes market mech. - ODA levels below 0. 7%; 19

CDM and SD: An Illusion? § An illusion • When SD is dependent on CDM and SD: An Illusion? § An illusion • When SD is dependent on host country approval and there is competition between host countries; • When contract success is not based on achievement of the SD component; • When SD component is not verified: • When IC buy CERs without checking SD component; • When SD component is vague and all-encompassing § A fact: • When SD is translated into quantitative goals that can be measured? ? • When contract success and CER approval is based also on achievement of SD component; • When ICs purchase CERs that have a clear SD component; • When a percentage of the project costs are used for the SD component; 20

Climate Change Regime: Paradigm Shift § 1990 s • • Abstract Global Future issue Climate Change Regime: Paradigm Shift § 1990 s • • Abstract Global Future issue Economic and technical issue § 2000 s • Real, interfering with daily activities and needs (MDGs) • Multi-level • Current issue • Development issue: Climate change is the defining development issue of our generation (UNDP 2007) 21

Policy evolution towards mainstreaming § Development • • • 2002: Donor report 2005: Gleneagles Policy evolution towards mainstreaming § Development • • • 2002: Donor report 2005: Gleneagles plan 2005: EU 2006: World Bank- CEIDF 2007: OECD Declaration § Climate change regime • 1995: AIJ includes national priorities • 1997: CDM includes sustainable development • 2000: IPCC links cc with sd • 2007: IPCC links cc with sd 22

Mainstreaming: Driving Converging Forces Aid agencies EU Devp. Banks DCs Mainstreaming CC In devp. Mainstreaming: Driving Converging Forces Aid agencies EU Devp. Banks DCs Mainstreaming CC In devp. coop Acade mics OECD NGOs UNDAF 23

Mainstreaming defined § “Mainstreaming of climate change into development cooperation is the process by Mainstreaming defined § “Mainstreaming of climate change into development cooperation is the process by which existing development processes are redesigned and reorganized, improved, developed and evaluated from the perspective of climate change mitigation and adaptation. Mainstreaming implies involving all social actors – government, civil society, industry, local communities - into the process. Mainstreaming calls for changes in policy as far upstream as possible. ” 24

From Ad hoc approaches to mainstreaming Development agenda Politically Easy -------------------------- Difficult Climate change From Ad hoc approaches to mainstreaming Development agenda Politically Easy -------------------------- Difficult Climate change ignored Climate change taken into account Ad hoc projects Focus on win Climate proofing Integration Mainstreaming Ad hoc ------------------------- full From ad approaches to mainstreaming 25

Climate change and international cooperation § International cooperation is needed to help developing countries: Climate change and international cooperation § International cooperation is needed to help developing countries: • Adopt modern technologies and policies to avoid taking the past emission route of the North; • Adopt measures that will enhance the ability of the South to adapt to the impacts of climate change § International cooperation includes: • Climate cooperation • Development cooperation 26

Practical arguments in favour of mainstreaming cc in aid § Efficiency of use of Practical arguments in favour of mainstreaming cc in aid § Efficiency of use of development resources enhanced since climate change affects development and development affects climate change § There is aid fatigue and no extra money is politically very feasible § Money is clearly needed for climate change and it is more easily justified to spend developed countries on climate change than on development per se § Transaction costs lower if mainstreamed 27

The link between development paradigms and development aid 28 The link between development paradigms and development aid 28

The link between development paradigms and development aid 1 1 2 3 29 The link between development paradigms and development aid 1 1 2 3 29

Resources needed Current ODA Additional ODA needed for MDGs ODA Aid for needed for Resources needed Current ODA Additional ODA needed for MDGs ODA Aid for needed for climate Agenda 21 change Total USD billion 100 60 -135 125 40 -250 315 -611 Comment <0. 4% of Clemens et donor GNI al. 2007 Ch. 33, Agenda 21 Lit. Overlaps Assumptions 30

Political sensitivities Development cooperation 0. 7% of GNI Actual assistance Time 1. 0% of Political sensitivities Development cooperation 0. 7% of GNI Actual assistance Time 1. 0% of GNI Climate assistance Expectations/ needs Actual climate assistance Mainstreaming 31

Diverging beneficiaries of assistance 32 Diverging beneficiaries of assistance 32

Mainstreaming: the stages of mainstreaming Development agenda Politically Easy -------------------------- Difficult Climate change ignored Mainstreaming: the stages of mainstreaming Development agenda Politically Easy -------------------------- Difficult Climate change ignored PL IT DK, NL UK US aid Ad hoc projects Focus on win OECD EU Climate change taken into account Climate proofing Integration Mainstreaming Ad hoc ------------------------- full The stages of mainstreaming 33

Conclusion - 1 § Mainstreaming of climate change in development cooperation does not make Conclusion - 1 § Mainstreaming of climate change in development cooperation does not make sense; it will lead to a diversion of resources. However, mainstreaming of climate change in development does make sense! § Instead, a search for win options, climate proofing and climate integration make more sense in relation to development cooperation. This is not the case for development. 34

Conclusion – 2: If Mainstreaming is inevitable …. 35 Conclusion – 2: If Mainstreaming is inevitable …. 35