#UNCDFExpertsChat: Last Mile Finance for Climate Resilience: Adaptation through localization

  • November 18, 2015

  • Bangkok, Thailand

The success of the 2030 Agenda will depend in large part on the success of global efforts to tackle climate change. Climate change threatens to undo decades of progress towards reducing poverty and improving human development.

#UNCDFExpertsChat spoke with Fakri Karim, Programme Manager of UNCDF’s Local Climate Adaptive Living Facility (LoCAL), about how to manage risks from climate impacts, protect communities and strengthen the resilience of the economy through localization.

Fakri Karim has been the global Programme Manager for LoCAL since 2012. Before managing the LoCAL programme, Fakri has managed the capacity development support within the UNCDF Provincial Government Support Programme in the Solomon Islands. From 2005 to 2010, he has worked with UNDP in Indonesia managing a number of rehabilitation, reconstruction and development projects in Aceh, including design and execution of the strategic framework for the implementation of the Special Autonomy and Oil and Gas Fund to support local economic development in Aceh. Prior to joining the UN system, Fakri has worked as a manager for a number of private companies, including PT Ritra Cargo Indonesia and PT Supra Indo Pratama.

Questions and Answers (Q&A)

#UNCDFExpertsChat: Could you explain what is the development challenge you are trying to solve?

Fakri Karim: Least Developed Countries (LDCs) are some of the most vulnerable to climate change. They are least able to recover from climate stresses; have lower capacity to adapt than other developing counties; and their economic growth is highly dependent on climate-sensitive sectors, such as agriculture.

Central governments alone cannot respond to the challenge of climate change. Large-scale nationally financed programmes require complementary local actions in order to be fully effective. But while local authorities in LDCs are finding themselves on the frontlines of climate change, they often lack the capacities and resources to deliver on their climate change mandates.

In many LDCs, local governments cannot absorb the incremental costs of climate change adaptation through local taxes and other revenue streams. Most resources come earmarked from central government for recurring expenditures, leaving little for ’climate-proofing’ existing infrastructure. Existing funding for climate change adaptation supports mostly large-scale national projects and institutions, bypassing local communities and their institutions.

Local governments seeking to strengthen climate change resilience therefore need adequate resources and effective integration of climate change considerations into their local planning, budgeting and investment cycles.

#UNCDFExpertsChat: How does LoCAL solve that challenge?

Fakri Karim: The Local Climate Adaptive Living Facility (LoCAL) offers UNCDF’s local development finance core approach to local governments to help reduce vulnerability of local communities to the adverse effects of climate change.

LoCAL provides a mechanism to enable the mainstreaming of climate change adaptation into local governments’ planning and budgeting systems; increase awareness and response to climate change at the local level; and increase the amount of finance available to local governments for climate change adaptation.

We also work in partnership with a number of organizations such as the World Resources Institute (WRI) and the Korean Environment Institute (KEI). Our partnership with KEI ensures that local governments are provided with a scientific framework on climate change – that is, local governments are provided with a tool to verify if the CCA activities that they have planned and implement through the performance-based grant mechanism responds to both current AND future climate change issues. Meanwhile, our partnership with WRI provides local governments with a CCA monitoring and evaluation framework to allow them to measure the results of the activities implemented through performance-based grants and ascertain that they are contributing to the increased resilience of the community.

#UNCDFExpertsChat: What are the last mile financing models of LoCAL? How does your programme build public/private partnerships?

Fakri Karim: LoCAL combines performance-based climate resilience grants, which ensure programming and verification of climate change expenditure at the local level, with technical and capacity-building support.

It is designed to re-enforce existing national and sub-national financial and fiscal delivery systems. Once proof of concept has been established, it is meant to unlock further flows for local adaptation, including national fiscal transfers and global climate finance.

In this way, LoCAL’s last mile financing enables local governments to cope with the increased cost of building resilience to climate change and natural disasters.

#UNCDFExpertsChat: How does LoCAL support the achievement of the SDGs?

Fakri Karim: UNCDF overall uses its capital mandate to contribute primarily to SDG 17 on the means of implementation. Through LoCAL, UNCDF uses its tools and financing models to contribute to SDGs 9 (on resilient infrastructure), 11 (on resilient and sustainable cities), and 13 (on climate change).

This includes support for adaptive land use planning, drainage and water management; implementing resilient building regulations; retrofitting infrastructure; strengthening roads and bridges; and adapting agricultural systems.

#UNCDFExpertsChat: The SDGs have a strong focus on leaving no one behind. How does LoCAL reach poor communities and under-served regions in LDCs? How does it make sure that it reaches women and vulnerable groups?

Fakri Karim: First of all, LoCAL focuses on Least Developed Countries, and in those countries, it targets secondary and tertiary cities – these tend to be fast-growing areas which are straining to meet the demands placed on them for services and infrastructure as well as the need to adapt to the effects of climate change.

In addition to this geographic focus on under-served regions, LoCAL overall adopts a participatory approach. This includes conducting community consultations and feedback processes at various stages, from scoping to performance assessment, as well as building local capacity to undertake participatory vulnerability assessments and planning processes, in particular when identifying specific activities to be funded.

LoCAL also specifically raises awareness and encourages the participation of women and vulnerable groups in local governments’ planning and budgeting processes. Through the performance-based climate resilience grants mechanism, for example, gender and vulnerable groups have been identified as one of the performance indicators.

#UNCDFExpertsChat: Can you give an example of how LoCAL has made a difference to the lives of poor people and communities?

Fakri Karim: At the local level, LoCAL has supported the development of small but essential infrastructure that is helping local governments increase the resilience of their communities to climate change.

In the Cambodian province of Battambang, for example, most people are farmers and laborers. They stay in the village during planting season, and in the off-season they migrate to other places to find work as laborers. O’Chamnap is a small village located near the main road. It is a passing point for many families that go to the fields. The location is strategic, but is exposed to flash, strong, and unpredictable floods, often occurring during the night. Few people know how to swim, making fast flowing waters a real threat to human life. Thanks to LoCAL, the O’Chamnap community was finally able to build a climate-resilient bridge.

Another example comes from Cambodia. In the Moung Ressey district a flood refuge mount was built in a flood-prone community, to provide a safe place for the local community and animals to relocate during floods. In the Thmakoul district, a flood protection dam was built to protect the community from floods, and also serve as a reservoir to supply water to paddy fields located around the dam, while also serving as an alternate road during flood periods. And a community pond was built in the Bati district, where the community was facing water shortages for household use. The new pond can store enough water for the whole year to use for cooking, drinking, gardening and for animals. The community has even committed to investing in the maintenance of the pond using their own resources to ensure its sustainability and long-term benefits for the community.

LoCAL has many other concrete illustrations that demonstrate the impact of our model on people’s lives; leverage/resource mobilization; and partnerships. All stories can be found on the LoCAL website (www.local-uncdf.org).

#UNCDFExpertsChat: What's the plan for scale up? What can we look forward to in the future of LoCAL?

Fakri Karim: LoCAL is currently on-going in 10 countries: Bangladesh, Benin, Bhutan, Cambodia, Ghana, Lao PDR, Mali, Mozambique, Nepal, and Niger.

To date, LoCAL has provided USD 3.2 million in grants to 38 local governments servicing a population of over 4.5 million across these ten countries in Asia and Africa. In 2016, 12 additional local governments from five LDCs in Africa and the Pacific are expected to join and make use of the mechanism, thereby enabling communities in which another two million poor people live to benefit from this new type of access to climate finance and the adaptation investments that follow.

In the longer-term, the vision for LoCAL is to support bilateral, private and multilateral technical and financial partners to deliver performance-based climate resilience grants across countries and regions, responding to the needs of the most remote populations and the most vulnerable communities in LDCs.

#UNCDFExpertsChat: What's exciting about working in this space?

Fakri Karim: Climate change is the most serious risk facing our planet right now, and it’s imperative that we identify innovative solutions that help communities adapt to its potential effects.

LoCAL is one such solution, addressing a real problem many local governments in LDCs face. The benefits of LoCAL also extend beyond climate change, and can help boost local development more broadly too.


About LoCAL

The Local Climate Adaptive Living Facility (LoCAL) of the UN Capital Development Fund serves as a mechanism to integrate climate change adaption into local governments’ planning and budgeting systems, increase awareness of and response to climate change at the local level, and increase the amount of finance available to local governments for climate change adaption. LoCAL combines performance-based climate resilience grants (PBCRGs), which ensure programming and verification of climate change expenditures at the local level, with technical and capacity-building support. It is designed to re-enforce existing national and sub-national financial and fiscal delivery systems, and it uses the demonstration effect to trigger further flows for local adaptation — including national fiscal transfers and global climate finance for local authorities — through their central governments. For more information, please visit www.local-uncdf.org.

A Story from the Field: Financing local responses to climate change: the bridge that saves lives