2. CLIMATE CHANGE – A CHALLENGE FOR DEVELOPMENT

“The developing countries are expected to suffer the most from the negative impacts of climate change. This is due to the economic importance of climate-sensitive sectors (for example, agriculture and fisheries) for these countries, and to their limited human, institutional, and financial capacity to anticipate and respond to the direct and indirect effects of climate change. In general, the vulnerability is highest for least developed countries in the tropical and subtropical areas. Hence, the countries with the fewest resources are likely to bear the greatest burden of climate change in terms of loss of life and relative effect on investment and the economy.

Multi-agency report on ’Poverty and Climate Change’ (2002, p.5) ”

2.1 Impacts of climate change on development

Climate change is a major global challenge and a potential threat to human welfare and to economic and social development. Therefore, climate change is also a major development challenge. The negative effects of climate change are mostly felt in developing countries. Climate change is a serious risk to the fight against poverty and could lead to a set back in years’ work to protect and enhance human well-being and sustainable development.

Analyses, including those prepared for the 2005 UN Summit on reaching the Millennium Development Goals (MDG), have high-lighted that without urgent and adequate global responses to climate change, the efforts to achieve the MDGs and other development objectives could be undermined. Similarly, climate change may undermine the efforts and outcomes of development cooperation.

Development cooperation programmes and projects are designed with explicit or implicit assumptions about the climate in which they will function. The conventional way is to assume that the climate of the past is a reliable guide to the future. This is no longer a sufficient assumption. To address climate change, the design criteria must be based on probable future climate scenarios and expected impacts.

In order to take climate change into consideration, the environmental assessment of development cooperation programmes and projects will have to address not only the effects of development cooperation on the environment, but also the impacts that imminent climate-related environmental and socio-economic changes have on development cooperation.

Sector specific risks can be identified for typical sectors in development corporation programmes. To determine the risks to which sectors are exposed, it is necessary to examine their vulnerability to specific hazards. The potential hazards from climate change and climate variability include:

• Increased surface temperatures.
• Sea level rise.
• Decreased or increased precipitation.
• Soil erosion.
• Fluctuating and changing courses of rivers.
• Changes in frequencies and intensity of storms.
• Changing weather patterns, including drought and flood patterns.
• Glacier lake outbursts from increased melting of ice capped mountains.

Sectors that are most vulnerable to the risks of climate change and increased climate variability are:

• Agriculture: influence on crop production from higher temperatures and changes in rainfall and water supply, changes of pest and disease patterns.
• Water resources: greater evaporation, changes in rainfall, changes in ground water levels, increasing water demands in warmer climate, salt-water intrusion with sea level rise.
• Human health: greater risks of vector borne and water borne diseases, greater heat stress, and exposure to ultra-violet radiation.
• Biodiversity and natural ecosystems: greater risks of loss of vulnerable coastal and marine ecosystems including wetlands, mangroves, and coral reefs, increased risk of desertification and loss of biodiversity, impact on migratory species.
• Coastal area infrastructure: sea level rise, more severe storms.
• Housing and other infrastructure: heavier rains and storms, water availability.
• Tourism: temperature changes, sea level rise, disease patterns, and water availability.

The impacts of climate change and extreme weather events, like tropical storms and floods, can have a devastating impact on developing countries’ economies. For example, climate change can cause damage to infrastructure, e.g. roads, harbours and other development projects, often funded by poor countries with a mixture of loans, soft loans and grants.

According to a UNEP study (2002), worldwide economic losses due to natural disasters appear to be doubling every 10 years. On current trends, annual losses may reach almost USD 150 billion in the next decade. Although not all natural disasters are caused by extreme weather and climate change, this gives an indication of the scale of the costs of climate change.

As an example, in 1999 and 2000 a large port terminal in a Caribbean island was devastated by unexpected weather events. Reconstruction and loss of revenues cost millions of dollars. The loss could have been reduced if proper risk assessment and higher standards of design specifications had been used. Although this would have implied an additional cost, such cost would only have been in the 10-15 per cent range of the cost of reconstruction.³

Climate change can also lead to less visible impacts that have an influence on a large group of people. This may be the case in subsistence and commercial farming due to erosion or flooding, damage to feeder roads, and increased outbreak of tropical diseases.

The costs of such complex events are difficult to assess. However, by taking precautionary action⁴ through risk management and up-front investments, loss of human lives and resources for development may be avoided.

The anticipated adverse impacts of climate change therefore should be addressed through use of appropriate climate change planning and management tools in development cooperation programmes. Integrating such tools in environmental assessments and design of development cooperation programmes will help climate proof development cooperation. Thereby, climate proofing becomes an integrated part of environment-friendly development policy and risk assessment of any investment in countries and sectors that are vulnerable to climate change.

2.2 International Cooperation on Climate Change

The challenge of climate change can only be met through a concerted international effort and through cooperation between developed and developing countries. The United Nations Framework Convention for Climate Change (UNFCCC) is the key multilateral agreement addressing climate change.

Through the Climate Convention, the industrialized countries agreed to stabilize their greenhouse gas emissions at the 1990 level. However, the Climate Convention did not set out internationally agreed reduction targets.

In 1997, at the third conference of the UNFCCC, agreement was reached to set up the Kyoto Protocol under UNFCCC. The Kyoto Protocol includes binding targets and instruments to address the emission of greenhouse gasses (GHG) into the atmosphere.

According to the Kyoto Protocol, developing countries do not have binding targets to reduce greenhouse gas emissions. In absolute terms, emission of GHG in developing countries will, however, soon reach levels similar to the emissions of industrialized countries. This is mainly due to strong economic growth and increasing energy consumption in major emerging economies. Against this background, international negotiations are initiated to discuss how to broaden the effort to mitigate climate change after the expiration of the Protocol’s first commitment period in 2012.

Box 2: The Kyoto Protocol

According to the Protocol, Denmark has to reduce its emission of GHG by 8 per cent to 92 per cent from the base year in 1990. However, according to an agreement in the European Community to meet EU’s overall emission reduction targets, Denmark has made a commitment to reduce GHG emissions by 21 per cent from the 1990 base year in the first commitment period.

The European Union is a driving force in the international efforts to address climate change. At a meeting of the European Council in March 2005, agreement was reached to work for ambitious targets as part of the international climate change regime. Increased international efforts were called for to ensure that the average global mean temperature will not increase by more than 2⁰ Celsius compared to the pre-industrial level.

As a step to support climate change actions in developing countries, the EU has developed the ’EU Action Plan on Climate change in the Context of Development Cooperation’.

Box 3: EU Action Plan on Climate Change in the Context of Development Cooperation

With the Danish ’Climate and Development Action Programme’, steps are taken to accelerate Danish implementation of the ’EU Action Plan on Climate change in the Context of Development Cooperation’. It signals Denmark’s recognition of climate change as a major global challenge with particularly negative impacts on developing countries.

2.3 The Scientific Background to Climate Change

Climate change is probably the most significant driver of global environmental change. The Intergovernmental Panel on Climate Change (IPCC) has defined climate change as “Any change in climate over time, whether due to natural variability, or as a result of human activities”. IPCC is the independent scientific panel of the United Nations assessing the causes and impacts of climate change (box 4).

15 The scientific challenge addressed by IPCC includes three main issues:

1. Is there a climate change according to the IPCC definition?
   The question more precisely is whether there is a change in climate that may exceed the resilience of the natural and economic systems? According to scientific data compiled by IPCC⁵, there is enough evidence to suggest an ongoing climate change.
   
   
2. What are the causes of climate change?
   The scientific community agrees that the accumulation of greenhouse gasses contributes to climate change. It is, however, difficult to determine the extent to which climate change can be attributed to human activities. IPCC has concluded that most of the observed global warming over the past 50 years is likely to be due to the increase in GHG attributable to human activities releasing GHG into the atmosphere from fossil fuel burning and from biomass decomposition, e.g. deforestation.
   
   
3. What are the impacts of climate change?
   The question is how climate change will influence human livelihood, the natural ecosystems, and industrial and agricultural production. Such impacts are central to achieving key development goals, including poverty reduction. Thus, IPCC has assessed that the negative effects of climate change are mostly felt in developing countries. While there is agreement that climate change can cause severe negative impacts, it is also recognized that climate change may have positive impacts.

Box 4: Scientific background to climate change

³) For less investment intensive projects, the additional cost would be less. Through cost-benefit analysis of different construction standards during project appraisal, the potential risks and expected damages may be weighed against the cost of risk mitigation options and the present value of avoided damage over the project’s lifetime.

⁴) Principle 15 of the Declaration from the Rio Conference on Environment and Development (see glossary).

⁵) IPCCfn5 Third Assessment Report (2001) – http://www.ipcc.ch