Editing IPCC:AR6/WGII/Chapter-9 (section)

==== 9.4.1.3 How Much Finance is Being Mobilised? ====

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The amounts of finance being mobilised internationally to support adaptation in African countries are billions of US dollars less than adaptation cost estimates, and finance has targeted mitigation more than adaptation ( ''high confidence'' ). The Organisation for Economic Co-operation and Development ( [[#OECD--2020|OECD (2020)]] estimates an average of USD 17.3 billion per year in public finance targeting mitigation and adaptation from developed countries to Africa in 2016–2018, with adaptation expected to be a small share of this amount. Of the global total, only 21% in 2018 targeted adaptation (there is no breakdown provided for Africa). Analysis of OECD data that is reported by the funders, covering bilateral and multilateral funding sources, estimated international public finance (grants and concessional lending) committed to Africa for climate change for 2014–2018 at USD 49.9 billion: 61% (30.6 billion) for mitigation, 33% (16.5 billion) for adaptation and 5% (2.7 billion) for both objectives simultaneously (Figure 9.8a; [[#Savvidou--2021|Savvidou et al., 2021]] ). This equates to an average of USD 3.8 billion per year targeting adaptation ( [[#Savvidou--2021|Savvidou et al., 2021]] ). In per capita terms, only two countries (Djibouti and Gabon) were supported with more than USD 15 per person per year, most were supported with less than USD 5 per person per year ( [[#Savvidou--2021|Savvidou et al., 2021]] ).

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'''Figure 9.8 |''' '''Total adaptation-related finance (commitments) to African countries and regions from 2014–2018 (USD millions, constant prices) as reported to OECD.'''

'''(a)''' Flows of committed finance targeting adaptation by source and recipient region;

'''(b)''' trend over time in international development finance commitments targeting adaptation in Africa; and

'''(c)''' country-level shares of total climate finance commitments that targeted adaptation or mitigation or both simultaneously. Source: [[#Savvidou--2021|Savvidou et al. (2021)]] .

The multilateral development banks (MDBs) report 43% of their climate-related commitments to sub-Saharan Africa in 2018 targeted adaptation (EBRD et al., 2021). Sources other than international public finance are more difficult to track and there is limited data on Africa (Cross-Chapter Box FINANCE in Chapter 17). Considering a wider range of finance types (including private flows and domestic mobilisation), an estimated annual average of roughly USD 19 billion in climate finance for 2017–2018 went to sub-Saharan Africa, of which only 5% was for adaptation ( [[#CPI--2019|CPI, 2019]] ; [[#Adhikari--2021|Adhikari and Safaee Chalkasra, 2021]] ). The mobilisation of private finance by developed country governments, through bilateral and multilateral financial support, is lower in Africa relative to other world regions. Globally, in 2016–2018, Africa made up only 17% of mobilised private finance relevant for climate change ( [[#OECD--2020|OECD, 2020]] ).

Strong differences exist among African sub-regions. Finance commitments targeting adaptation increased from 2014–2018 for east and west Africa but decreased in central Africa ( [[#Savvidou--2021|Savvidou et al., 2021]] ) (Figure 9.8b). Climate-related finance was &gt;50% for adaptation in 19 countries, while 26 received &gt;50% for mitigation ( [[#Savvidou--2021|Savvidou et al., 2021]] ).

African countries expect grants to play a crucial role in supporting adaptation efforts because loans add to already high debt levels that exacerbate fiscal challenges, especially in light of high sovereign debt levels from the COVID-19 pandemic ( [[#Bulow--2020|Bulow et al., 2020]] ; [[#Estevão--2020|Estevão, 2020]] ). From 2014–2018, more finance commitments targeting adaptation in Africa were debt instruments (57%) than grants (42%) ( [[#Savvidou--2021|Savvidou et al., 2021]] ).

For Africa combined, the sectors targeted with most support for adaptation are agriculture and water supply and sanitation, which account for half of total adaptation finance from 2014–2018 (Figure 9.9a). The sectoral distribution has changed little over these years, suggesting adaptation planners and funders are maintaining a relatively narrow view of where support is needed and how to build climate resilience ( [[#Savvidou--2021|Savvidou et al., 2021]] ).

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'''Figure 9.9 |''' '''Adaptation finance for Africa has focused most on agriculture and water, and disbursement ratios for climate-related finance are very low''' 

'''(a)''' The amounts of finance targeting adaptation committed to different sectors across Africa from '''2014''' '''–''' '''2018''' '''in millions of USD as reported to OECD and including multilateral development banks (Savvidou et al.''' , 2021).

'''(b)''' Disbursement ratios (disbursements expressed as percentage of commitments) for finance targeting mitigation and adaptation, and for total development finance; showing disbursement ratios for Africa compared to global average; and

'''(c)''' disbursement ratios for adaptation finance broken down by each African sub-region for 2014–2018 (for all funders reporting to OECD except multilateral development banks). Source: [[#Savvidou--2021|Savvidou et al. (2021)]] .

However, to understand actual expenditure on adaptation, it is necessary to look at disbursements (that is, the amounts paid out compared to committed amounts). Low ratios of disbursements to commitments suggest difficulties in project implementation. Disbursement ratios for climate-related finance from all funders other than MDBs (for which data is not published) in Africa are very low (Figure 9.9b; [[#Savvidou--2021|Savvidou et al., 2021]] ). Only 46% of 2014–2018 commitments targeting adaptation were dispersed ( [[#Savvidou--2021|Savvidou et al., 2021]] ). Regions faring worst are north Africa (15%), central Africa (33%) and west Africa (33%) (Figure 9.9c). These disbursement ratios for adaptation and mitigation finance in Africa are lower than the global average ( [[#Savvidou--2021|Savvidou et al., 2021]] ), which suggests greater capacity problems in implementing climate-related projects and, in turn, means lost opportunities to build resilience and adaptive capacity and a wider gap in adaptation finance for Africa ( [[#Omari-Motsumi--2019|Omari-Motsumi et al., 2019]] ).

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