Speakers in Economic and Social Council Underline Innovative Solutions to Build Climate Resilience for Most Vulnerable States
Speakers explored on the multidimensional nature of resilience and proposed forward‑looking solutions that could help vulnerable small island developing States to confront hurricanes, typhoons, drought and other impacts of climate change, during a special meeting of the Economic and Social Council today.
Opening the discussion, Inga Rhonda King (Saint Vincent and the Grenadines), President of the Economic and Social Council, invited participants to make the case for vulnerability to be a criterion for ensuring concessional financing for small island developing States. She stressed the ongoing importance of official development assistance, alongside innovative and risk‑informed financing and new instruments including insurance products. “For this, the support of the international community is required,” she stated. Going forward, she emphasized the need for “a holistic notion of resilience” that encompasses economic and environmental elements as well as economic diversification.
Luis Alfonso De Alba, the Secretary‑General’s Special Envoy for the 2019 Climate Summit, said building resiliency is an urgent matter for small island developing States. The international community needs to consider the difficulty of accessing resources for these nations as they are considered middle‑income countries and sometimes have a high level of debt. For the 2019 Summit, the Secretary‑General is paying attention to the issue of adaptation, the reduction of emissions and increasing the resiliency capacity of the most vulnerable countries, he explained.
Colin Granderson, Assistant Secretary‑General, Foreign and Community Relations, Caribbean Community Secretariat, reviewed its efforts to make the Caribbean the world’s first climate-resilient region. “Not surprisingly, we view climate change as an existential threat,” he said. Investing in preparedness for natural hazards and climate change is key to establishing resilience and reducing the economic and human cost, he said, adding however that there are several financing impediments. “There is clearly a need to explore innovative financial instruments and more open‑minded policy approaches,” he said.
Alicia Bárcena Ibarra, Executive Secretary, Economic Commission for Latin America and the Caribbean (ECLAC), speaking via video link, discussed its efforts to provide technical advice and help build capacity to reduce vulnerability while strengthening institutions. She also discussed the Commission’s proposal for the Green Climate Fund to acquire Caribbean debt at a discount, thus giving “fiscal breathing space” for countries to focus on resilience‑building strategies.
Luis Felipe Lopez-Calva, Director, Regional Bureau for Latin America and the Caribbean, United Nations Development Programme (UNDP), recalling the trail of unprecedented destruction left by Hurricanes Irma and Maria in September 2017, said that building strong partnerships is critical for supporting States as they build resilience. Reflecting on financing for developing, UNDP supports the clear call for the vulnerability of small island developing States to be recognized as a criterion in country classification, so climate‑vulnerable island nations can access concessional financing.
Two interactive panel discussions explored the topics “Taking stock: Commitments and results to date” and “Next steps: Financing a forward-looking resilience-building agenda in small island developing States”.
Opening Remarks
INGA RHONDA KING (Saint Vincent and the Grenadines), President of the Economic and Social Council, recalled the organ’s special meeting on 24 October 2017 titled “Aftermath of recent hurricanes: Achieving a risk‑informed and resilient 2030 Agenda” and the related presidential statement which called on Member States and the international community to ensure that humanitarian responses be complemented by medium- and long‑term recovery and reconstruction efforts. Among other things, that meeting and presidential statement called for greater investment in disaster risk reduction and encouraged donors and international financial institutions to explore financial solutions in view of high debt and the urgent need for reconstruction financing in affected small island developing States. They underscored the need for sustained and coherent international support to speed up recovery and ensure risk‑informed reconstruction.
The meeting and presidential statement also called attention to the urgent need to combat climate change, she said, citing the United Nations Office for Disaster Risk Reduction as saying that climate‑related disasters in 1998‑2017 caused $2.245 billion in direct economic losses, with the 10 worst affected countries and territories in terms of losses as a percentage of gross domestic product (GDP) being in the Caribbean. This is not only an issue for the Caribbean, however, with Vanuatu in 2015 losing 61 per cent of its GDP due to Cyclone Pam. With the Sendai Framework for Disaster Risk Reduction 2015‑2030 calling on countries to prepare to “build back better” ahead of a disaster, she emphasized the need for strengthening disaster risk reduction governance and securing access to adequate financing before a catastrophe strikes.
Today’s meeting will take stock of results achieved to date and to make the case for vulnerability to be a criterion for ensuring that country classification allows concessional financing for climate vulnerable small island developing States, she said. At the same time, official development assistance (ODA) remains important for small island developing States as catalytic financing, alongside innovate and risk‑informed financing and new instruments including insurance products. “For this, the support of the international community is required,” she stated. Going forward, she emphasized the need for “a holistic notion of resilience” that encompasses economic and environmental elements. For small island developing States which largely depend on one major export product, economic diversification is key, including tapping into such emerging sectors as the blue economy. Cooperation is also required in health, she said, noting that Pacific and Caribbean States are among the most challenged globally by non‑communicable diseases.
She concluded by inviting today’s participants to reflect on the multidimensional nature of resilience and propose a forward-looking agenda to help transform the development trajectory of small island developing States and deliver on the promise of the Sustainable Development Goals to achieve resilience.
LUIS ALFONSO DE ALBA, the Secretary‑General’s Special Envoy for the 2019 Climate Summit, said the United Nations has worked with many of the Caribbean countries since the hurricanes that devastated the region in 2017. For example, in Dominica and Antigua and Barbuda 70 to 90 per cent of the housing was damaged. The international community had to strengthen its actions to support these countries and to identify support from different Governments. These and other issues had to be addressed in a multi‑faceted fashion, so rebuilding could be carried out in a better way. The latest report on climate change shows the situation may worsen very quickly. Building resiliency is an urgent matter for these countries. Small island developing States find themselves in an urgent situation. The international community needs to consider the difficulty of accessing resources for these nations as they are considered middle‑income countries and sometimes have a high level of debt. There is a need for the collaboration of Governments to provide financing for these countries.
The raising of accessibility to climate financing is important for these countries, he continued. The Secretary‑General believes it is important to recognize and address their vulnerabilities in a different way. For the 2019 Summit, the Secretary‑General is paying attention to the issue of adaptation, the reduction of emissions and increasing the resiliency capacity of the most vulnerable countries. These nations need technical assistance. The Summit will increase attention to the fight against climate change in a more balanced way and address the issues of mitigation. The Secretary‑General welcomes the involvement of the Council in preparation of the Summit. There have to be additional incentives to spark actions by Governments to address the concerns of small island developing States and help raise the level of ambition of the most developed countries. The international community is still on time to reach the 1.5°C limit as a maximum increase. “We need you and we are also behind you,” he said.
COLIN GRANDERSON, Assistant Secretary‑General, Foreign and Community Relations, Caribbean Community Secretariat, called the Caribbean one of the world’s most vulnerable and disaster‑prone regions. “Not surprisingly, we view climate change as an existential threat,” he said, emphasizing that scarce resources earmarked for development have been diverted to post‑disaster relief and reconstruction efforts. He reviewed the Caribbean Community’s (CARICOM) response to the situation, with the goal of creating the world’s first climate‑resilient region. CARICOM summit meetings in February and July revisited the Community’s resilience agenda, drawing lessons from the hurricanes that swept through the region in September 2017 and tested the limits of the Caribbean Disaster Emergency Management Agency’s regional response mechanism, he said.
Investing in preparedness for natural hazards and climate change is key to establishing resilience and reducing the economic and human cost, he said, adding however that there are several financing impediments. Graduation and middle‑income categorization deny Caribbean small island developing States access to low‑cost development and concessional financing. High indebtedness and burdensome repayment costs leave little fiscal space to build climate‑resilient infrastructure. Borrowing at market rates is prohibitive, while coverage levels of the Caribbean Catastrophe Risk Insurance Facility are constrained primarily by the amount of coverage a CARICOM member State can afford.
“There is clearly a need to explore innovative financial instruments and more open‑minded policy approaches,” he said. Those could include using vulnerability as an additional criterion for accessing concessional financing; classifying debt resulting from recovery, reconstruction and building resilience under a non‑debt rubric; building capacity to navigate the complexities of accessing climate funds; the creation of fiscal space through debt relief; the conversion of bilateral and multilateral debt into special funds to address natural hazards and economic shocks; and the production of new insurance products as well as higher levels of coverage for Government exposure.
He concluded by saying that CARICOM member States will continue their advocacy vis‑à‑vis the Organization for Economic Cooperation in Development (OECD), the International Financial Institutions and their development partners calling for strong collaborative action in addressing the challenges of financing resilience, climate financing and the sustainable development of small island developing States, taking greater account of their peculiarities and vulnerabilities. “The welfare of the people of the Community demand no less,” he said.
ALICIA BÁRCENA IBARRA, Executive Secretary, Economic Commission for Latin America and the Caribbean (ECLAC), speaking via video link, emphasized that it is putting the Caribbean first in all its activities. Adaptation is a pressing issue for the Caribbean where building resilience must be a priority, she said, noting that the seven small island developing States hit hardest by 2017’s hurricanes totalled more than $6.9 billion in damage, not including Puerto Rico, United States Virgin Islands and Cuba. She discussed the Commission’s efforts to provide technical advice and help build capacity to reduce vulnerability while strengthening institutions.
In parts of the Caribbean, things are still not back to normal, she continued, emphasizing that it will take years for agriculture and tourism to recover. The latest report from the Intergovernmental Panel on Climate Change only confirmed what small island developing States are experiencing, she said, adding that the Caribbean will barely survive the ferocity of storms likely to emerge from warmer seas. An additional challenge faced by Caribbean nations is debt, which amounts to $52 billion or 70 per cent of subregional GDP. But because of their middle‑income status, based only on GDP per capita, those States do not qualify for concessional funding, ODA or preferential trade arrangements. Given that situation, ECLAC has put forward a proposal that the Green Climate Fund acquire Caribbean debt at a discount, thus giving “fiscal breathing space” for countries to focus on resilience‑building strategies.
LUIS FELIPE LOPEZ-CALVA, Director, Regional Bureau for Latin America and the Caribbean, United Nations Development Programme (UNDP), said when Hurricanes Irma and Maria struck the Caribbean in quick succession in September 2017, they left a trail of unprecedented destruction across the region. The recovery needs for reconstruction and resilience interventions totalled $1.37 billion. UNDP and the United Nations system responded immediately and on the ground within days of the disasters and the Programme remains extremely engaged in the Caribbean at the regional and national levels. Drawing on its experience in the Caribbean, he outlined three ways to lay down a path for greater resilience in small island developing States. First, it is critical to build strong partnerships to support those States as they build resilience, as emphasized at the interregional preparatory meeting for the Samoa Pathway mid‑term review. At the CARICOM‑United Nations high‑level pledging conference, $3.2 billion was promised for the Caribbean, including $1.6 billion in grant pledges.
Reflecting on financing for developing, UNDP supports the clear call for the vulnerability of small island developing States to be recognized as a criterion in country classification, so climate‑vulnerable island nations can access concessional financing. It is important to improve the ease of doing business. Regarding innovative financing, the diaspora represents an important source of financing for Caribbean and Pacific small island developing States. In the case of the Caribbean, for example, remittances make up more financial flows annually than foreign direct investment (FDI) and ODA combined. Building economic resilience through diversification helps build buffers to exogenous shocks. UNDP is pleased many small island developing States have embraced the “blue economy” approach to improve economic diversification. There is not a quick fix for building resilience in those States. Disasters provide a space for reflection, as well as an opportunity for policies and investment that will consider future threats.
Dialogue I
The Council then held a dialogue titled “Taking stock: Commitments and results to date”. Moderated by Ms. King, it featured presentations by Walton Alfonso Webson, Permanent Representative of Antigua and Barbuda to the United Nations; Loreen Ruth Bannis-Roberts, Permanent Representative of Dominica to the United Nations; and Nigel Salina, Chairman, Global Business Leadership Forum.
Mr. WEBSON (Antigua and Barbuda) said he welcomed the opportunity to take stock since the natural hazards swept through the region in 2017. The Caribbean countries are among the most vulnerable in the world and climate change has only intensified their vulnerability. In 2017, Antigua and Barbuda was among the countries most devastated by hurricanes Irma and Maria. The losses have been extreme and the Government had to carry out the total redevelopment of the island as well as taking care of the emotional and physical needs of its people. The psychological and social costs were enormous as were the costs to the national government for the country’s rebuilding. The Government welcomed the activity of the United Nations and the significant amount of funds pledged. Yet the country continues to suffer. Responses need to be stronger and quicker after fundraising events are held. Climate change is real and will only worsen. There must be machinery in place to let these resources be directed to the islands, based on their vulnerability. Lessons need to be learned. He looked forward to creative forms of raising financing. He supported the efforts of ECLAC. New models needed to be developed to replace current fundraising efforts. This would let countries respond quickly on the ground.
Ms. BANNIS-ROBERTS (Dominica) said Hurricane Maria wreaked unimaginable havoc on her country and decimated its social and economic infrastructure and exposed its 70,000 citizens to the elements. Dominica has since established an innovative agency, the Climate Resilient Execution Agency, tasked with the goal of rebuilding the country with a central focus on climate resilience. With total damage estimated at 226 per cent of its GDP, Dominica knows that meeting the resilience building challenge will not be easy. The strategic and operational plans of all Government ministries now include a focus on resilience and sustainability. This lays the groundwork for cooperation between the Climate Resilient Execution Agency and line ministries, she said. Dominica is already seeing the fruits of its hard work as students have returned to schools, famers to their fields and tourists to hiking trails. With the help of UNDP, World Food Programme (WFP) and other partner agencies, more than 400 contractors and construction workers were trained in resilient construction methods and building codes have been revised. Electricity and water have been restored to more than 95 per cent of the island. The Government’s goal is to establish a climate resilient Dominica within five years. To meet this goal, resilience must be incorporated into all actions, from infrastructure to the economy to social sectors.
Mr. SALINA, Chairman, Global Business Leadership Forum, noting he was at the United Nations pledging conference, said the private sector in the region began a massive mobilization to determine how to support the islands following the hurricanes. It worked consistently to support the region, for example, sending out 60 containers to the islands affected and employing contractors and other support staff in Dominica. Many contractors are still there to offer support and assistance. The private sector helped to rebuild schools and get children back into the classrooms and build more hurricane resilient homes for the needy. It built a warehouse to store the supplies.
The private sector held several stakeholder meetings in the region, which brought people together from around the world to discuss solutions to deal with the changing climate, he said. The Forum is organizing a business and trade mission in 2019 and a business forum with chambers of commerce from the region to stimulate economic growth and debating how the business community can support the islands. He said it is time to look for new partnerships between the private sector, Government and civil sector as the threat of climate change increases. All need to move to action and solutions with through collaboration, communication and cooperation.
The representative of Egypt, speaking on behalf of the “Group of 77” developing countries and China, said the negative responses of climate change must be acknowledged, especially for the most vulnerable nations. The Group appreciates the unique needs of small island developing States. The Samoa Pathway Review serves as a platform for action to move forward. Better policies and investment could help.
The representative of Barbados, speaking on behalf of CARICOM and associating herself with the Group of 77, said the representatives from the Caribbean countries had spoken with eloquence about how their countries had been impacted by natural hazards. Barbados stresses the importance of the recent report on climate change and the significant challenges posed by the impact of global warming. She called for a vulnerability index and new financing mechanisms. Assistance was needed for middle‑income countries.
The representative of Cabo Verde underscored the impact of drought on African small island developing States like his. “Drought is a silent disaster with negative impact on lives and livelihoods,” he said, emphasizing the financing challenges his country is facing since its graduation to middle‑income status.
The representative of Canada underscored the need to recognize the vulnerability of small island developing States as well as the need to provide better support. Her country’s priority is to ensure that these countries have access to concessional financing. In this regard, there is a need to strengthen the global risk insurance framework.
The representative of Cuba said that climate change is no doubt a threat to the survival of small island developing States, and the agreements, such as the Sendai Framework, Samoa Pathway and the Paris climate accord, must be implemented as one package. Cuba has focused on preventive measures and early warning systems, she said, emphasizing the importance of international cooperation and exchange of experiences in disaster risk reduction.
Also speaking were representatives of Norway and the Russian Federation.
Dialogue II
The Council then held a dialogue on the theme “Next steps: Financing a forward‑looking resilience‑building agenda in small island developing States”. Moderated by Ms. King, it featured presentations by Paul Oquist Kelley, Minister, Private Secretary for National Policies of the President of Nicaragua and Co‑Chair of the Green Climate Fund Board; Marlene Moses, Permanent Representative of Nauru, speaking on behalf of the twelve Pacific small island developing States; Chamberlain Emmanuel, Head, Environmental Sustainability Cluster, Organisation of Eastern Caribbean States; and Denis Jordy, Lead Disaster Risk Management Specialist, Global Facility for Disaster Reduction and Recovery, World Bank Group.
Mr. KELLEY said small island developing States are facing not only rising sea levels, but also rising debt levels “that could sink them”. Total external debt stocks of those States more than doubled between 2008 and 2017 in an environment of low interest rates that now are rising. The deck is stacked against developing countries in the asymmetries of the hegemonic economic structure. The only equitable way to deal with climate finance is for countries that caused the climate change problem to compensate those suffering the consequences in proportion to their responsibility. He outlined several measures set out by the United Nations Conference on Trade and Development (UNCTAD) Intergovernmental Experts Group, including debt relief and the ECLAC debt and climate swap initiative, emphasizing the importance of developed countries fulfilling the commitment of 0.7 per cent of GDP for ODA, and supporting replenishment of the Green Climate Fund in 2019. On resilience, he suggested a number of options, including strategic food reserves, underground power lines, energy efficiency and reforestation of degraded land.
Ms. MOSES discussed four urgent priorities for the international community to help Pacific small island developing States address climate‑related challenges. There should be easier access to international sources of finance through streamlined application processes as well as new approaches to project financing, such as direct access modalities and direct budgetary support. On increased finance for adaptation and resilience measures, she said it should mainly be grant‑based, as private markets have shown little interest in funding adaptation “and it is too expensive to boot”. While many people had high hopes for the Green Climate Fund, the slow pace of its replenishment is a growing concern and, too often, it has been used as a bargaining chip in political games. She urged the Fund’s board to promptly agree to a reliable and predictable replenishment process that will make adequate levels of climate finance available to meet the urgent needs of developing States. She went on to express deep concern that the establishment of an international mechanism to address loss and damage has waned as a political priority. It is essential to speed up progress in that regard so vulnerable countries can rebuild from cyclones, floods and droughts, she said.
Mr. EMMANUEL stressed the need for a narrative of “small island developing States exceptionalism” pinned on their unique vulnerability. He reviewed the efforts being made by the Organization of Eastern Caribbean States in drafting a “truly Caribbean” resilience framework for its member States and territories. It is clear that Caribbean nations have the ambition of moving towards resilience, but what resilience looks like needs to be understood. Implementation depends on external support. He went on to discuss the Caribbean Nationally Determined Contributions Finance Initiative, which at its first investment forum in Saint Lucia in October emphasized the advantages of a private‑public partnership approach to improve the quality and quantity of bankable projects. He also underscored the link between climate change and migration in the Caribbean, as well as the potential for climate change to act as a catalyst for the region’s transition to a green and blue economy.
Mr. JORDY reviewed the various ways in which the World Bank is addressing the issue. He cited several examples, such as the release of $10 million from an ongoing project in Dominica following Hurricane Maria. The Bank’s approach is based on proactive disaster risk management. He described insurance as a critical pillar, adding that the Bank strongly believes that partnerships are fundamental for climate change and disaster risk reduction action.
In the ensuing discussion, the representative of the Maldives, speaking on behalf of the Alliance of Small Island Developing States, said climate change is the single biggest challenges for the group. Projects have been implemented to mitigate the impact of climate change, but it is adaptation that will make a difference. Formula suggested by small island developing States is a framework where international financial institutions and development partners can work side by side with Governments for better investments and access to concessional financing while reducing external debt burdens.
Representatives of the Organisation for Economic Cooperation and Development (OECD) and World Meteorological Organization (WMO) also spoke.