Despite escalating climate risks worldwide, the adaptation finance gap has grown and now stands between US$194 billion and US$366 billion per year. This gap is substantially larger, at least 50 percent, than previously estimated, said the Adaptation Gap Report 2023: Underfinanced. Underprepared – Inadequate investment and planning on climate adaptation leaves world exposed.
The report from UNEP emphasizes that climate adaptation efforts are lagging when they should be accelerating to address rising climate change impacts and risks. The world is already experiencing temperatures exceeding 1.1°C above pre-industrial levels, and current plans suggest we’re on a path toward 2.4°C–2.6°C by the end of the century.
“Today’s Adaptation Gap Report shows a growing divide between need and action when it comes to protecting people from climate extremes. Action to protect people and nature is more pressing than ever,” UN Secretary-General António Guterres said in his message on the report. “Lives and livelihoods are being lost and destroyed, with the vulnerable suffering the most.”
“We are in an adaptation emergency. We must act like it. And take steps to close the adaptation gap, now,” he added.
RISKS OF UNCHECKED CLIMATE CHANGE
As climate change intensifies, so do its impacts, creating compounding and cascading effects that lead to more climate-related losses and damages. The Intergovernmental Panel on Climate Change (IPCC) warns that even if Paris Agreement goals are met, residual climate risks will persist, resulting in economic and non-economic losses and damages.
ROLE OF ADAPTATION PLANNING
The report notes that progress has been made in establishing national adaptation planning instruments. However, one out of six countries still lacks such instruments, and there’s a need to accelerate their development.
The adaptation costs for developing countries in this decade are estimated at around US$215 billion per year, with projections of significant increases by 2050 due to escalating climate risks.
While international public climate finance flows to developing countries increased for mitigation efforts, adaptation finance has faced barriers, including low disbursement ratios. In 2021, international public adaptation finance decreased by 15 percent.
WAYS TO BRIDGE THE GAP
The report identifies seven potential approaches to close the adaptation finance gap. These include international public adaptation finance, domestic expenditure on adaptation, private-sector finance, remittances by migrants, support for small and medium-sized enterprises, global financial architecture reform, and consistent finance flows with low-carbon, climate-resilient development.
This report serves as a stark reminder of the urgency in addressing the adaptation finance gap, especially as climate change continues to impact communities and ecosystems worldwide.
