Accelerating innovation and private investment in Climate Adaptation and Resilience (UNIDO)
Recent climate-driven disasters such as floods, rising temperatures, unpredictable weather patterns, forest fires that acutely affect developing countries highlight the urgent need for investment in adaptation. International adaptation finance flows to developing countries are 5-10 times below estimated needs of USD 160-340 billion by 2030 and USD 315-565 billion by 2050. The financing gap is also widening with less than USD 50 billion per annum currently allocated to climate adaptation, mainly coming from the public sector with corporations and institutional investors providing just USD1 billion ~ 2%. To bridge this widening financing gap in adaptation, it is imperative to promote private investment. However, private investment in climate adaptation in developing countries encounters several challenges, including the undervaluation of business opportunities and returns on investment, limited access to localized climate risk and vulnerability data, and inadequate institutional arrangements and adaptation policies.
As part of effort to increase private investment in climate change adaptation in developing countries, this session will highlight the untapped potential of private sector actors, such as entrepreneurs, SMEs, farmers, banks, and investors, who can actively contribute to climate adaptation and resilience efforts to secure their own operations but also drive innovation and financing for adaptation in vulnerable communities.