Live Online Chat - Financing Urban Adaptation and Resilience

Live Online Chat - Financing Urban Adaptation and Resilience 
With Peter King and Bikram Ghosh on Friday, 26 June 2015, 11:00am-12:00pm (UTC+07:00) Bangkok time

When the impacts of climate change are most felt in cities, and with more than 1 billion people in the Asia-Pacific living in these disaster-prone areas, more resources should be channeled to cities to build urban resilience. In the last five years, however, only a small fraction of international adaptation finance has gone into funding urban projects.

  • How do city or local governments overcome financing challenges?
  • To what extent should city or local governments have autonomy over their spending decisions?
  • What can multilateral climate funds do to better engage cities?

TRANSCRIPT:

APAN:
Good morning, everyone. Welcome to this Live Online Chat session. We will be starting the chat in about 2 hours time. If you have any questions that you would like to share in advance, please private message me or email: the-exchange@adapt-asia.org Thank you!

APAN:
A gentle reminder to all participants viewing this window to sign in with a Chatroll account or Facebook or Twitter during the chat.

APAN:
To all we have just joined this chat room, a big welcome. We'll be starting our discussion in about 40mins time.

APAN:
Thanks for joining in. Our climate finance and urban experts Dr. Peter King and Bikram Ghosh from USAID Adapt Asia-Pacific are standing by. Looking forward to our discussion in about half an hour.

APAN:
A warm welcome again to newcomers joining the chat - to all participants viewing this window, may we ask that you please sign in with a Chatroll account or Facebook or Twitter. Thank you!

APAN:
A very warm welcome and thank you all for joining this chat.

APAN:
Once again, to all participants viewing this window, may we ask that you please sign in with a Chatroll account or Facebook or Twitter.

APAN:
Before we begin, I would like introduce myself:

Ella Sotto Antonio:
Hi just chiming in. Good day to everyone.

APAN:
I am Augustine Kwan at the Institute for Global Environmental Strategies Regional Centre based in Bangkok, Thailand. And I’ll be moderating this chat.

APAN:
We help support the Asia Pacific Adaptation Network with generous assistance from the USAID Adapt Asia-Pacific project.

APAN:
This chat culminates the email based discussion we recently concluded on “Financing Urban Adaptation and Resilience.”

APAN:
We have Dr. Peter King and Bikram Ghosh from USAID Adapt Asia-Pacific standing by to take questions for one hour.

bghosh:
Hello Everybody - welcome to the chat session

Peter_King:
Thanks to everyone for joining the chat - and thanks to everyone for the earlier wealth of information through the Exchange

APAN:
Hi Peter and Bikram - maybe we can start by taking the first question we received earlier..

APAN:
This is a question from Lisa Junghans at Germanwatch: Do you have concrete ideas how local authorities can raise financial resources on their own, e.g. through local taxes, local levies, local charges or other innovative local options such as PPP?

APAN:
Lisa, please free to jump in with comments and follow-up questions.

bghosh:
The first step for urban local governments is to inventory national and state/regional programs – many countries have ongoing programs to finance CCA measures. Tapping into these sources is probably the lowest hanging fruit. Some countries also have set up national funds such as the Indonesia Climate Change Adaptation Trust Fund (ICCTF) that may offer streams of funding focusing on urban areas.

Lisa_Junghans:
Thanks for posting the questions. I'm eager to hear the responses from Mr. King and Mr. Gosh

Peter_King:
Clearly climate change adaptation is a local issue and needs local solutions. The best way for local governments to approach the issue, therefore, is from the perspective of risk management. Local resources can be raised if there is a clear economic case that can be made for the adaptation measures

Peter_King:
The challenge, however, is that many local governments don't have the necessary capacity or resources to make the convincing economic argument that can be used to convince the local taxpayers

Lisa_Junghans:
But behind not every adaptation measure lies an economic case.

Peter_King:
While that may be true, to justify using local taxpayer funds does need a convincing argument - if not economic then social and/or environmental

Lisa_Junghans:
I agree.

Shom Teoh:
Talking to several local governments, they said that apart from national allocations, they can either raise their own taxes or apply for bank loans (in certain countries, this is not allowed though). I'm wondering how then can national governments help lower the costs of borrowing for local governments?

bghosh:
In many cases it may help to focus on project finance – it is usually to easier to access financing for specific well developed projects. A bankable project maybe able to access sources not usually available to city governments such as bank loans or capital investors. Separating project finances from city government finances will also attract investors not willing to invest in government programs

APAN:
Many thanks for your response, Shom - could you please introduce yourself to the group?

Peter_King:
One way for national governments to assist is to create trust funds or equivalent that local governments can tap into, with concessional or grant terms

bghosh:
Special Purpose Vehicles aimed at financing individual projects or groups of projects can also be set up

BriannaF:
Lack of effective social action can undermine the economic viability of say, flood management -- e.g.waste disposal, lack of care for public goods, etc cuts the economic life of pumps by 50% in some cities in Asia

Shom Teoh:
Hi everyone! I'm Shom from IGES and I'm managing a technical assistance and small grants progrmame to ASEAN cities in cooperation with the ASEAN Secretariat.

BriannaF:
Hi all! Brianna Ficcadenti here, part of the USAID Adapt Asia-Pacific team.

Shom Teoh:
May I know which countries have been taking pioneering actions on designing bank loan programme which target local governments or local businesses on investing in climate adaptation?

Peter_King:
The Adapt team is working with local municipalities in the Philippines and India

Peter_King:
We are working closely with the Cities Development Initiative for Asia (CDIA)

Lisa_Junghans:
Are you by chance working with the city of Cagayan de Oro in the Philippines?

Peter_King:
Which conducts pre-feasibility studies to help prepare projects for investment in Asian cities

bghosh:
India had significant success in accessing capital markets and commercial loans for infrastructure in the past when local legislation prevented city governments from borrowing

Shom Teoh:
I have studied one such programme in Malaysia (it's not targeted at green tech innovations, not climate adaptation per se). One of the lessons learnt was that commercial banks were still not educated enough to assess the bankability of proposals for investing in climate change. Hence, even though the national government offered to bear part of the interest rates, banks were not ready to process those application effectively.

Ella Sotto Antonio:
Unfortunately, people have to be hit hard first to become aware, act and put in resources. We have a clear case in the Philippines so evrybody is trying to innovate. For instance, we are working now with the Bank of Philippine Islands to help LGUs make their CC projects bankable.

Peter_King:
The specific city we are working with in the Philippines is Valenzuela, part of Metro Manila - Bruce Carrad can give us more information on both these activities

Ella Sotto Antonio:
In response to Peter's questions, I provided info on how CC is prioritized in local and national budgeting.

Peter_King:
Yes Ella - the issue of prioritization is critical, as the local level and national level priorities are not always the same

icleiseas:
Hi all, this is Catherine from ICLEI Southeast Asia. I agree with Peter. Normally, climate adaptation financing from multilateral funding is coursed through the national government and they can provide mechanisms for LGs to access this funding (e.g. People Survival Fund in the PH). With regards to loans, small municipalities (at least in the PH) are not keen on borrowing.

BruceCarrad:
The PFS for Valenzuela showed that there was very significant loss of economic life in infrastructure. Cagayan de Oyo may have the same problem. Social awareness and effective organization is needed to protect investments and clean up disposal mechanisms or new projects will fail

Peter_King:
One lesson learned is the make funds available to the national level, then empower the local government to work with stakeholders on how to best spend those scarce resources

bghosh:
I agree with Catherine in general cities should exhaust all in-country options first before looking at international or multilateral sources. There are three main reasons – the country may not always be set up to accept international finances such as funding form the AF requires a National Implementing Entity to be accredited. Most international financing sources will have a high bar and stringent criteria that may not be easy for all urban governments to meet.

bghosh:
Finally in most cases the funds will flow through national governments and the priority of the higher level of government may or may not align with your priorities.

Peter_King:
The real question is if there is a proven methodology to ensure that money flows from international to national to local levels with appropriate prioritization at each level

Shom Teoh:
What are the new ways we can address the gap between the national and sub-national level?

icleiseas:
In addition, there are things to consider such as governance structures (autonomy of LGs, limiting laws, budgeting & planning processes) and capacity of LGs (fiscal, technical and institutional).

Shom Teoh:
Peter, what are the usual challenges that international funders face when it comes to chdisbursing funds to the sub-national level (assuming national approval is already secured?)

Peter_King:
Shom, I think one way is to allocate funds to the most vulnerable areas in the country, based on vulnerability assessments, and then allow the local government to work with local stakeholders to agree on how to spend the money

Ella Sotto Antonio:
Cities must be empowered and made self-sufficient. Some Philippine cities, Valenzuela, Iloilo and Cagayan de Oro included, improved their business sytems procedures thus generated much more resources that they are able to use now for adaptation purposes.

P_Sawhney:
Hi everyone, Puja here, although I agree with Bikram that countries should look at in country options, if you ask the countries to do so, the reaction is that they don't have the money and they need externally funding without relapsing that they are actually already spending money on adaptation which is not necessarily labeled as 'funding for adaptation'

Shom Teoh:
Is it a simple problem of the local level being unable to implement professional financial accounting of funds?

Peter_King:
Most international funds cannot lend directly to local level - they have to go through a national level agency, such as the Ministry of Finance, as the funds need to be repaid and add to the national debt burden

RavinderS:
A major challenge international funders face is all the capacity and experience of local entities in handling projects

icleiseas:
I agree with Ella. But, the examples you gave are well-off LGs. how about the other small municipalities? capacity equates with accessible/available financing. Thus, capacitating LGs and putting the right systems in place are essential.

Peter_King:
Ravinder - not only do they have problems in implementing projects, in our experience they have difficulty in designing projects too

RavinderS:
I completely agree with you Peter. By capacity I meant all stages of the project cycle

Peter_King:
Technical assistance that works through embedding experts in local governments for some time, using on-the-job training and mentoring tends to help build capacity

bghosh:
the challenges increase manifold at the level of smaller local governments - there have been some experiences of clubbing smaller municipalities together to design and implement regional projects

Peter_King:
For international funds, programmatic approaches are often preferred to small projects

bghosh:
however the basic capacity question goes back to the essential question of good urban governance

Shom Teoh:
Peter and Bikram, low capacity at the local level seems to be fundamental and perenneial problem in any international projects working with local communities. What are the latest thoughts on addressing this?

BruceCarrad:
Peter: What are the best websites that have information on how local urban entities can get started with adaptation activities?

Peter_King:
We are developing an urban climate change adaptation training course. Bikram can explain how testing this went in Indonesia

RavinderS:
In my work at the Adaptation Fund I have also observed that in several cases where some experience exists, the ability to satisfactorily document and demonstrate the capacity/experience is lacking

bghosh:
thanks Peter

bghosh:
we are in the initial stages of testing a six module program for urban managers on CCA

P_Sawhney:
www.asiapacificadapt.net

bghosh:
the course will cover basics of urban CCA all the way through to project preparation and finance

Shom Teoh:
who are the 'urban managers' specifically?

Peter_King:
Thanks Pooja - is there a specific page for urban users?

Ella Sotto Antonio:
A policy and mechanism to allow multilateral funds to flow well fro national to local must indeed be put in place. However, there should also be clear policies and mechanisms to allow LGUs to access external funds directly. There are several facilities available e.g., Municipal Bonds and PPP. The times now call for proactive efforts at the local level. Governmental processes are complex and slow. Disasters are fast and swift.

bghosh:
mid to senior level officials working in urban infrastructure and climate change

Peter_King:
Also C40 and 100 resilient cities website are great

P_Sawhney:
@ Peter- there's a page on urban areas and infrastructure- http://www.asiapacificadapt.net/resources/themes/urban-areas-and-infrast...

bghosh:
Keith Bettinger (who is on this chat session) is one of the main developers and trainers for the course

Keith Bettinger:
Ella are you aware of any examples in which local governments are using municipal bonds to finance CCA?

Shom Teoh:
How do you ensure(or incentivise?) those urban managers who have learned from the course to actually aply their knowledge in the real world?

Peter_King:
Also there has been a massive increase in green bonds too

BruceCarrad:
LGUs can help themselves more too by mobilizing actions to support social awareness and better care of their existing infrastructure

Peter_King:
New York is raising $23 billion in bonds to fund its climate change adaptation

Peter_King:
One problem, Bruce, is that climate proofing infrastructure, for which there is money available, depends on having the infrastructure first

Keith Bettinger:
Any global south examples?

Ella Sotto Antonio:
Keith, I know cities that availed of Municipal bonds but will need to check if used for CCA. Will let you know.

Keith Bettinger:
Many thanks Ella.

APAN:
We have yet to hear from our local government counterparts – so let me put out questions we received from Mayor Alfredo Coro from Del Carmen, Philippines.

bghosh:
its a good question Keith

bghosh:
anyone on this forum have any experience?

APAN:
1. What is the most important climate adaptation program that a local government must do as qualified by experts and that can easily find international funding support that does not have to go through multiple layers of bureaucracy.

Peter_King:
Nearly all climate change adaptation projects must start with a vulnerability assessment - who is exposed and and what are the main hazards?

alisatang:
I'm a journalist with the Thomson Reuters Foundation. Bikram: Sorry I'd like to go back to the training course -- When did you test this urban climate change adaptation training course in Indonesia, and how did it go? Where else do you plan to have this course?

bghosh:
The first pilot was conducted in Bandung, Indonesia in partnership with ITB and Ministry of Home Affairs

bghosh:
participants included national and local representatives from Indonesia's disaster management agency also in charge of CCA

bghosh:
we have two more pilots planned - one in Philippines and the other in Indonesia again

P_Sawhney:
In addition, the vulnerability assessment should also identify degree/ severity of exposure/ vulnerability, potential measures to counter the threats. What would be ideal is to identify local solutions.

bghosh:
those will work with local government officials in smaller municipalities

Peter_King:
Local solutions are often not well known - what are some of the potential local solutions?

icleiseas:
Bikram, what are the outcomes of the training?

bghosh:
the purpose was to test the modules and seek feedback on course structure and content

bghosh:
we got a lot more than that :)

Shom Teoh:
There is some discussion on how investing in 'social capital' will be a pragmatic approach where physical investments are unaffordable, especially for the smaller cities. What are your thoughts on this?

Ella Sotto Antonio:
Bikram, I may have missedit. Is the training on CCA or disaster management or both?

Peter_King:
what is the long term plan for this training, beyond the pilots?

icleiseas:
I asked because I want to know how different this is from other existing projects to capacitate LGs on CCA.

alisatang:
Bikram: What did they feel most useful, and what did they feel was lacking? And what do you mean, "a lot more"? :)

P_Sawhney:
Example could include growing local variety of trees/ plants to counter salinity intrusion

Shom Teoh:
How do you measure the effectiveness of the training conducted?

bghosh:
overall the training was well received - it was clear that local level officials want more information on basic climate science and adaptation measures

bghosh:
before they can make the leap to project development

bghosh:
the course is on CCA

Peter_King:
Pooja - is there a database of adaptation options available?

bghosh:
we generated a lot of discussion on comparing approaches taken by developed countries as opposed to developing ones

bghosh:
Keith feel free to chime in

P_Sawhney:
Yes, indeed. APAN has two databases, one on good practices and the other on technologies

P_Sawhney:
http://www.asiapacificadapt.net/adaptation-technologies

P_Sawhney:
http://www.asiapacificadapt.net/adaptation-practices

Keith Bettinger:
Thanks Bikram

bghosh:
The course should be ready for roll-out in the October/November timeframe

Ella Sotto Antonio:
Shom, in a project with BPI and WWF, we covered 16 Phil cities to determine business climate risks/vulnerability. One of my takeaway lessons is indeed the need to invest in social capital, mainly education and health.

Keith Bettinger:
The course was well received and we are currently revising the materials based on lessons learned for another pilot to be delivered at the beginning of August.

alisatang:
Bikram/Keith: how many people were in the first training session, and how many for the August pilot?

Shom Teoh:
We are talking about this in our cities project. One observation is that the well governed cities tend to have very active multi-stakeholder networks. However, 'silo' mentality often prevents diferent groups of actors working together. I'm wondering how international development agencies can do more to promote network creation at the local levle.

Lisa_Junghans:
And once the pilot training are over, will cities themselves be able to apply to have the workshop held in their city? Or how will you chose where the workshops will be carried out?

Shom Teoh:
My point is, training seems really appecreciated, but that's not enough to lead to real actions.

bghosh:
we will work with partners like the ITB for the courses to be institutionalized and offered on a long-term basis

BruceCarrad:
Ella: The PHI cities can also contact ADB office in MNL or WB off ice also in MNL for good information re investments/expertise and start talking about how to improve things in their cities

Keith Bettinger:
Alisatang we had approximately 20 participants in the first training. IN the second training my feeling is that we will aim for between 20-30, but those details are to be discussed among our team.

Shom Teoh:
I wish more funders and agencies devote more though to post-training support for practical activities.

bghosh:
we are looking at multiple regional organizations/univetrsities

Peter_King:
There is often a gap between a short term training and the real capacity to design and implement adaptation projects. Having a pool of experts to call on is critical, such as the Regional Technical Support Mechanism in the Pacific region

Shom Teoh:
I also wonder what are your thoughts on the propogation of training? It's good that a couple of urban officers are trained, but how do you design your materials so that it's easy for them to reuse it to teach others?

Peter_King:
Such a roster of experts available nationally would be really useful

Sarah Schneider:
Shom, we at the Cities Development Initiative for Asia (CDIA) support multi-stakeholder dialogue through prioritization exercises of infrastructure investment projects across different local government departments and public presentations and discussions of the results based on our CIIPP toolkit.

Ella Sotto Antonio:
Yes, Bruce. There's actually a lot of assistance already directed at cities. USAID SURGE (Strengthening Urban Resilience for Growth and Equity), which might cover 15 cities is another one.

Keith Bettinger:
Shom we're really working to make the modules into something that can be delivered in a wide range of settings.

icleiseas:
Another good reference for urban resilience building is the Asian Cities Climate Change Resilience Network (ACCCRN) being implemented in India, Indonesia, Thailand, Vietnam, Bangladesh and the Philippines. It showcases cases studies and several local adaptation options.

Keith Bettinger:
A lot of work is going into making them as "off the shelf" ready as possible.

Peter_King:
The Rockefeller Foundation has been funding many of these urban based adaptation approaches. How can we get other large foundations involved, as they often don't need to work through national governments, like the multilateral development banks need to do.

Shom Teoh:
Thanks Keith. I think every organisation is trying to help somehow. And the smart local governmetns will be able to connect the dots towards real impacts and benefits for their citizens. How can we help more local governmetn connect the dots? Or are we doing the best job of connecting our work meaningfully so they lead to something meaningful at the ground level?

RavinderS:
A good and effective way for imparting knowledge and skills to develop and implement adaptation projects would be a combination of training and actually working with experts to design and implement projects

Sarah Schneider:
The Resilience Officers funded by the RF at city level are a start in doing so

Peter_King:
Ravinder we have found that on-the-job training, while working with local staff to develop projects, has been very effective. However, longer term follow up and support is needed

Keith Bettinger:
Shom I think that is an excellent question. Peter's point about the work that Rockefeller is doing I think is part of the answer....steadily a corpus of best practices and success stories is being developed, and this hopefully will serve not only an inspiration but also as a model for other cities can communities.

Shom Teoh:
Thanks Ravinder, it's good. Perhaps we could draw some experience from the commercial sector on how to quickly and effectively mobilise training to the lay audience. For example, multi-level marketnig! (just being provocative)

Peter_King:
The Resilience Officers under the 100 resilient cities project is a good start, but how many cities are there in Asia and the Pacific?

Shom Teoh:
Pyramid schemes have one of most effective mechanisms for training a large number of ordinary people to recruit others to action. :)

Sarah Schneider:
not too many...

APAN: Time check:
we have about 10mins left for this chat session.

APAN:
We can take a couple more questions before we begin wrapping up this discussion.

Peter_King:
Sarah - I think about one quarter of the 100 cities in this region, but it is a tiny percentage of all the cities in Asia

Ella Sotto Antonio:
Shom, the other lesson from our work is that the LGUs AND the community/stakeholders must realize their needs and what they need to know, rather that others telling them what these are. Stakeholders in many developing countries have received many assistance (training, etc.) such that those that received these already tend to take these for granted.

Peter_King:
How can we scale up that experience?

Shom Teoh:
We have Chiang Rai, Danang, Mandalay, Bangkok, Bangalore, Chennai, Toyama, Surat, Semarang

Sarah Schneider:
bring cities together to discuss lessons learnt and sharing good practices, publish their stories, organize training of trainers courses, ...

bghosh:
peer-to-peer networking is also a very powerful mechanism

icleiseas:
Going back to financing CCA at the local level, I would like to share ICLEI's white paper "Financing the resilient City". It identifies essential issues to consider and forwards a demand driven approach for financing urban resilience building. http://www.iclei.org/fileadmin/PUBLICATIONS/Papers/Financing_the_Resilie...

Shom Teoh:
Ella, thanks, I realised that too. 'Training' is limited to certain people who are not incentivised to expand the knowledge to others. I'm wondering how we can address this.

Shom Teoh:
We must not be satisfied with the BAU of training (classroom and go home).

Keshav Jha:
Can someone please share insights on robust framework for monitoring and reporting of adaptation and resilience actions. ?

Peter_King:
While we are advertising, may we also mention the APAN Forum, which brings together all the adaptation experts in the region. Next year it will be held in Sri Lanka

bghosh:
twinning similar sized cities or cities facing similar challenges will often lead to better outcomes for both partners

Peter_King:
I agree on twinning as a useful mechanism - cheaper than consultants and more relevant knowledge

Ella Sotto Antonio:
Already mentioned are peer to peer and OJT. Awards can help too.

Peter_King:
Both sides of a twinning partnership benefit

alisatang:
Not sure if you answered Lisa_Junghans's question... And once the pilot training are over, will cities themselves be able to apply to have the workshop held in their city? Or how will you chose where the workshops will be carried out?

P_Sawhney:
Most cities do not have an M&E in place and those which do utilize it nor update it

bghosh:
alisa - we will work with Universities and other partners to institutionalize the trainings

bghosh:
they will continue to be offered on a long term basis

Ella Sotto Antonio:
Agree with Pooja. Indicators and data are not always available.

Sarah Schneider:
we just learned that about 50% of participants in a TOT on "Cities and Climate Change" jointly organized with the MFA Singapore already conducted courses themselves, so this seems to work in some cases

APAN:
Thank you all for a very insightful and robust discussion. This chat session is coming to a close.

P_Sawhney:
@ Bikram- good idea to work with universities

RavinderS:
Training should not be seen as a major objective. It is only an interim stage in a much larger process.

P_Sawhney:
APAN is going to do that for one of our online courses

Peter_King:
Sarah - follow up with trainees and agreeing on a future work plan gets the most out of training activities

Sarah Schneider:
I think that's why it worked

APAN:
I know there is a lot more we can discuss - but I'll leave it Peter and Bikram to say any last words.

APAN:
We'll be organizing another chat session in the coming months. Please do join us again.

APAN:
If you haven't already, please leave your contact details in a private message to me or Beth_IGES or email: the-exchange@adapt-asia.org

Peter_King:
Thank you everyone for a fantastic discussion - obviously we need to continue this topic and I hope Gus will find a way to do that effectively (as always). In the meantime, feel free to contact me by email.

bghosh:
thank you everybody for contributing to the session - this is an area of growing knowledge and we are all learning and growing together - keep up the good work

APAN:
Thank you everyone!!

APAN:
Our contact email again: the-exchange@adapt-asia.org

Keith Bettinger:
thank you for arranging this very educational session.

APAN:
We'll archive this chat and share with this group very soon. Thank you again.