Sebastiaan Van Herk (Spain) 1; Max Berkelmans (Spain) 1; Chris Zevenbergen (Spain) 2; Jesse Renema (Netherlands) 1
1 - Bax & Company; 2 - IHE Delft
The global dialogue on financing climate adaptation is maturing. To meet the SDGs as well as the water security goals emanating from climate change adaptation strategies, there are still many challenges ahead to increase the capacity to absorb the required investments. This is primarily a result of the low capacity in the water sector to design realistic and ‘bankable’ proposals, and to unfamiliarity of financiers with the water sector. The question arises how to bridge this investment gap? What are the needs of whom and who should take the lead in this?
Flood Risk Management and climate resilient urban development involve high complexity and risky investments. We call for a broad, integrated appreciation of costs and benefits and using a systems approach (at whole system level).
Flood Risk professionals and finance sector do not speak same language and have different perceptions. This requires shifts:
- focus on unlocking economic potential rather than on efficiency;
- from single projects to packages of projects (programs) requiring a long-term strategy with short term impacts;
- from understanding prevented damage to identifying trade offs (value added)
To Remove barriers to finance, we need to acknowledge interests of various policy areas, levels of government & private stakeholders (incl. financing world). And bring stakeholders together in the planning phase, where the role of scientists is to deliver the evidence base.
Water professionals need to be more emphatic with finance sector and vice versa. Finance sector and water professionals have to jointly develop evidence-based (long-term) investment scenarios towards sustainable development.
Cost benefit analysis (CBA) has demonstrated to be of great value in the past, however a shift is needed from traditional CBA to CBA that also includes broader FRM services (value added) provided to people and businesses, and their interrelationship. Pooling needs, resources and risks is possible mechanism to create critical mass and to capture benefits.