At the 2010 United Nations climate talks in Cancun, Mexico, the, the Parties to the UNFCCC recognised the need to strengthen efforts to understand and reduce loss and damage associated with the adverse effects of climate change, including impacts related to extreme weather events and slow onset events.

Parties requested the Secretariat to organise an expert meeting and a series of regional consultations to address issues related to a range of approaches to address loss and damage, taking into consideration experience at all levels.

Overseas Development Institute’s Emily Wilkinson reports from the Africa regional meeting held in Addis Ababa, Ethiopia in June 2012.

Framing the discussion on loss and damage from the African perspective

In June 2012, a group of experts met in Addis Ababa to discuss the full range of approaches and tools that can be used to address the risk of loss and damage associated with climate change, with specific reference to Africa.

The four main options discussed for addressing loss and damage were risk reduction, risk retention, risk transfer and institutions and governance arrangements to manage slow-onset events.

While the event focused on these options, participants also made time to discuss key principles to be considered with regard to the African context. An example of this was the desire to take into account indigenous knowledge and integrate it with ‘scientific knowledge’ to produce more accurate and useful climate forecasts and appropriate disaster risk reduction policies. Another was that strategies should not be imposed on vulnerable communities: the experiences and views of vulnerable people should be incorporated at all stages of addressing loss and damage.

Approaches for risk reduction

Discussions around disaster risk reduction focused on forecasting and early warning systems because of the role that these play in raising awareness and stimulating preparedness measures in anticipation of droughts and floods, the two most serious climate-related hazards in the region.

Although early warning systems have improved dramatically in Africa, the problem is that ‘they do not prompt early action’, according to one participant. In addition, more work needs to be done to translate forecasts into useful information about impacts in the future which in turn requires a better understanding of the multiple dimensions of loss and damage, so suitable strategies can be identified.

Climate change inflicts damage on cultural heritage, eco-systems and other difficult-to-quantify assets, and many participants felt that because of the importance of agriculture and heavy reliance on natural resources in Africa, an ecosystem-based approach was particularly suitable for addressing loss and damage.

The problem of capacity, and in particular lack of institutional capacity, was brought up repeatedly with regard to loss and damage. Some delegates felt that capacity was a big problem, limiting progress on everything else. Others were keen to emphasise that at the national level many countries have good disaster risk management systems; and at the local level, communities have extensive experience of adapting and minimising losses when faced with weather volatility.

Governments want to drive these processes themselves: that was clear from discussions. They have a critical role to play in sharing information, pooling resources and building institutional capacity at different scales to deal with climate risks.

Approaches for risk retention and risk transfer

New policy frameworks are often accompanied by new jargon, and the work programme on loss and damage is no exception. For the uninitiated, ‘risk retention’ means accepting the loss -- as opposed to modifying the hazard, modifying human behaviour or spreading the losses via insurance. It often means, literally, sitting back and doing nothing. However, in the context of loss and damage, governments are encouraged to put some money aside to either: deal with relatively small risks, where the cost of insuring is greater than the loss likely to be sustained; or to cover some aspects of relief and recovery, where the risks are so great that they cannot be insured against because the premiums would be too high.

Risk retention, then, is what most governments do in response to current, known risks. It is difficult to imagine them doing the same in anticipation of future, uncertain risks.

The session on risk transfer produced some interesting examples of how insurance products can be tailored to those who cannot usually afford to buy insurance, for example, by allowing farmers to offer their labour instead of paying the premiums. Participants rightly cautioned, however, an over-reliance on insurance, emphasising that it should only be one, perhaps relatively small component, of a more comprehensive strategy. Farmers need to be able to increase productivity in order to pay the premiums and also improve their yields when the rain comes, so in addition to insurance, technical support is needed. In addition, even as part of a broader strategy, insurance is not for everyone. Even if in-kind payments are accepted, many vulnerable groups are unable to offer their labour, such as the elderly and ill. For these people, safety nets are needed to cope with climate change.

Getting the institutions right

The role of regional and national level institutions required participants to grapple with questions of responsibility, coordination and cooperation. Regional institutions are needed to tackle shared problems, particularly where risks are trans-border and borders are porous, to avoid potential conflict. At the national level, policy making has to be undertaken jointly, led by national government, but coordinated with other stakeholders through national platforms. Likewise, implementation should be undertaken through local multi-stakeholder councils or committees. These views reflect an encouraging commitment from central government representatives - mostly from environment ministries - to distribute responsibility for addressing loss and damage both horizontally and vertically. Such cooperation is vital if climate risk is to be successfully integrated into development strategies.

Selecting appropriate loss and damage management tools

Cost-benefit analysis (CBA) can help guide the selection of loss and damage management tools, but many participants were critical, noting that cost benefit analysis is mainly used to assess top-down management strategies and fails to capture local coping and adaptation activities. Farmers plan in a holistic way to reduce and spread risks and this is not easily reflected in this type of analysis.

Other criteria for selection of loss and damage tools should include the level of existing knowledge and capacity, as well as ethical considerations, such as reaching the most vulnerable communities. Loss and damage has a political dimension, too: politicians do not decide on which policies to adopt solely on the basis of their effectiveness, but are influenced by other priorities that includevoter opinion and access to information. By building awareness of climate change impacts and encouraging data collection and dissemination, the loss and damage mechanisms currently in development through the UNFCCC’s work programme should help move risk management up the political agenda.

Photo: Caroline Gluck/Oxfam (10 Apr 2012)

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