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FEATURE: The learning curve of assessing the economics of climate change in Nepal

Dr. Govinda Nepal, IDS-Nepal, reflects at the half way point of a project in Nepal which is calculating the economic cost of climate change in key sectors on what the team has learnt so far

Which climate risk screening tool is the most appropriate for Nepal? What questions does an Investment and Financial Flow (IFF) answer? What is the difference between a vulnerability assessment and an impact assessment? How can DSSAT be applied?

These were just a few of the many questions we posed and answered during an intense training programme in Jan 2013. On this occasion we were the facilitators, building the capacity of policy-makers from across the Government of Nepal and selected research and other institutes. However, these are questions which we ourselves have been grappling with other the last year as we have been designing and implementing an economic impact assessment of climate change in the agriculture and water sectors in Nepal on behalf of the Ministry of Science, Technology and Environment (MoSTE) and with CDKN support.

A local team of Integrated Development Society (IDS) Nepal, and Practical Action Consulting Limited (PAC), Nepal has been supported by the leading experts in this field internationally, Global Climate Adaptation Partnership (GCAP). This partnership has been extremely successful in building our own capacity to carry out this highly technical work. At the same time we have guided GCAP on how to best engage with the Government and ensure our work has a long-term impact.

Looking back over the last year, we have as a team learnt a great deal. There have been many challenges that we have found ways to overcome and we have learnt about some of the essential ingredients to making such a challenging project a success.

As the study was requested by the Government (the idea originated in the 2011 National Climate Change Policy) and responds to national interests, it is critical that the Government has ownership and trust in the findings. The project has to therefore be closely aligned to Government priorities, which are not static given Nepal’s changing political situation and the regular turnover of senior Government officials. We have therefore dedicated time to engaging with the Government, making sure we are responsive to changes in their needs, and building ownership following Government staffing changes. The governance structure of the project also highlights that the Government is in the driving seat. A Project Steering Committee made up of all concerned Government ministries with some invited independent experts provides the overall steer to the project team. All publications and project outputs must have a government logo, and prior to publication all materials must be reviewed and approved by the Project Steering Committee and/or its Chairperson.

We also learnt that investing time in an inception period is vital. During this period we set up the internal project coordination mechanisms, which are crucial when working in an international-local consortium and in effect have two ‘clients’, the Government and CDKN. From a technical side, we used this time to review all available literature and data and ensure we are building on what has already been done. The team also took intense interest and time to select best possible methodology, identified possible synergies with on-going projects and we carried out several group discussions with national expert groups to get feedback on our proposed methodology, available data and information, and to explore whether there was learning from national or regional projects which we could avail. We had originally planned for a 3-month inception period but we realised we actually needed significantly more.

Importantly, from the outset, our approach has been participatory, inclusive, interactive and process oriented. We have put efforts into raising awareness among stakeholders, who are mostly non-technical professionals, about the methodology and models that we will be using. We have convened expert working groups so that we build a community of interested persons in the study. This has been an extremely valuable resource, for example, it was partly due to the advice of this group that we revised our approach for modelling the impacts on the hydropower sector.

Scientific models, as well as the sources of data, are often sensitive and so we made sure the whole process was transparent making it clear why we were and were not using certain approaches. We are now confident that our results will be trusted. At times we have not been able to transfer as much of the technical know-how as we would wish. We have increased policy-makers and researchers appetite to learn more about the modelling approaches but not had the time and resources to fully equip them with the skills to allow them to replicate our approach. But, overall, we are delighted with the amount of interest we have received in our work.

In addition to conducting the assessment and building understanding on the technical know-how of the study, we must also manage expectations, which can be rather challenging. The results of our assessment will be extremely useful to the Government, particularly to show both within Nepal and internationally the projected impact of climate change and the need for investment. However, the scope of the study obviously has to be limited and we cannot tailor it to meet every policy need and opportunity. The study outputs must also be seen in light of the uncertain nature of climate change, assumptions we have made and the limitations of data and models. While there is little doubt in Nepal that the climate is changing and is impacting on the economy, society and the potential future course of development, attributing certain losses and/or events to climate change is extremely difficult and quite risky. We need to caveat what we say with this context.

We have overcome these challenges, but surely there will be more as we progress towards completion of the study. But we are confident that our work will make a positive and significant impact and provide the Government of Nepal with the evidence that they need to deliver climate compatible development. We benefit from the study team’s open and collaborative relationship with the government, the positive inputs and support extended by CDKN and to the eagerness to cooperate by national and international experts.

Dr Govinda Nepal is affiliated and associated with major financial and development organization such as- National Planning Commission, Institute for Policy Research and Development, Nepal Economic Association, National Integrated College. At present he is the Professor of Economics in Patan Multiple Campus and also supervises PhD Thesis in Monetary Policy.

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