Feasibility assessment for Fiji National Climate Fund€¦ · Executive Summary The objective of...
Transcript of Feasibility assessment for Fiji National Climate Fund€¦ · Executive Summary The objective of...
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Feasibility assessment for
Fiji National Climate Fund
Final Report
16 November 2016
Author: Jessica Troni
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Executive Summary
The objective of this report is to assess the feasibility of establishing a Fiji National Climate Fund
considering issues such as capitalisation; legal, policy and planning frameworks and institutional
feasibility. National Climate Funds (NCF) are nationally driven and nationally-owned instruments to
help countries collect climate finance from a variety of sources, coordinate them, blend them together
and account for them.
Setting up a new institution or instrument is only worth the costs if it solves problems in the baseline
situation and does not create new problems, or at least that the positives should outweigh any
negatives. The problems to be solved by the establishment of an NCF were scoped out during the
preparation of this report to be as follows:
1. Low amounts of financing for resilience building initiatives and for low carbon development;
2. Project-based aid landscape which is a slow disbursement modality and undermines country
planning systems and policy leadership by Government ministries;
3. Low absorptive capacity in government;
4. Weak sustainability of projects,
5. Lack of integrated sector planning leading to unresolved environment/development problems
A range of risks in establishing an NCF were also highlighted during the preparation of this report
such as increased bureaucracy, costs, delays and lack of transparency in decision-making.
At a technical level, establishing an NCF in Fiji is feasible: the country has an enabling Financial
Management Act through which Government of Fiji could quickly establish the basic legal and
financial framework needed for the Fund; financial management and performance tracking systems
are in place, as well as some enabling legislation, and experience in running investment Funds.
There are also on-going reform processes on financial management and legal framework which could
benefit the establishment of an NCF.
There are also many weaknesses. The lack of integrated planning between ministries is a serious
constraint to designing and implementing adaptation strategies, given the linkages between climate,
energy, food and agriculture, water, forests, health and urban planning to name but a few. The links
between environmental degradation, climate change resilience and sustainable development are
reflected in the recommendations of numerous natural resource-based national strategies but there
appears to be a lack of political will across the government to implement the recommendations within
ministry spending plans and budgets. There has been limited mainstreaming of climate change policy
into sector plans and budgets in Fiji. The 2012 National Climate Change Policy scoped out around 72
priority actions across seven priority objectives but the action plan has not been implemented
according to the mid-term review of the Policy.
What is critically lacking for the establishment of the NCF is first and foremost two things: i) political
leadership for this idea and ii) evidence-based and costed adaptation plans and targets to
complement the existing national greenhouse gas emissions mitigation targets. The Ministry of
Economy needs to champion the structure and operational modalities of the NCF.
On capitalisation of the NCF, public finance alone cannot pay for the transition to a low carbon
resilient future. Given the scale of climate change financing needs, potential sources of financing
should comprise domestic tax revenues, private investment, development cooperation from bilateral
government agencies and multilateral institutions and a combination of public-private partnerships. A
key part of designing the NCF should be a consideration of how private sector finance could be
woven into a financing strategy for adaptation and greenhouse gas emissions mitigation. Investing tax
finance in the Fund would both signal government intention and commitment to the fund and build
trust among partners. These funds could go further if the funds could leverage Ministry budgets and a
coordinated policy process were initiated to ensure that all investments contributed to climate change
resilience. Carbon revenues from investments into greenhouse gas emission offsets could be another
source of finance.
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The two main design options are a fund held by government or a bank. Both could direct funding to a
set of agreed priorities within or outside the regular government planning framework of the country.
Both could attract international private sector financing, The bank could, in addition engage with the
domestic private sector in a wider range of financial strategies in order to promote GHG emissions
reduction and climate resilience. This design option is most likely to solve the baseline problems
without creating new ones. For climate change responses within the public sector, the feasibility
assessment argues that it would be more effective and more efficient to attract climate change
financing through country planning and budgeting systems than through a projects approach which
would be unlikely to solve any of the baseline problems.
Based on the assessment of design options, the structure proposed for the NCF in this report has
been identified to have the greatest chance of attracting funds, to distribute funds in an equitable and
rational manner and to lead to effective results on the ground. A two pronged strategy is
recommended on the delivery strategy.
• 1st prong: Bank facilitated NCF for climate change responses in private sector, civil
society and academia. The NCF would be located as a Trust Fund in a bank that is able to
design financial products for adaptation and GHG mitigation technologies for private
individuals and entities. In addition, a project modality should be established that can engage
third parties directly, through a small or medium grants window in order to promote innovate
research and results on the ground.
• 2nd prong: Government planning systems to facilitate climate change responses: Work
towards a hypothecated budget support mechanism that can be adopted within a 10 year time
period. This is in order to move away from the project modality that is currently prevalent in
Fiji to a country systems approach that is able to absorb larger scale flows and to fund multi-
year continuity of investments. Country systems can be used to track finance and
performance. Taking this approach would not constitute a Fund (unless absorptive capacity
was low and funding amounts high) as much as a facility. This facility could strengthen the
role of Ministry of Economy, through the Climate Change Unit, in the coordination of climate
change policy implementation as well as in strengthening the technical aspects of budget
preparation. A key part of this programme would be to establish a research programme to
target the most urgent gaps in the evidence base in order to inform adaptation plans.
An action plan containing 14 actions has been developed in this report which together adds up to a
three year work plan to get Fiji to the point where it could establish an NCF and a National Climate
Facility for support to ministries. The activities for the establishment of the NCF are grouped into three
distinct categories: i) establishing the national climate change targets and policy pathways ii)
developing the legal, policy and institutional problem analysis and action plan to address the gaps iii)
developing the operational strategy for the NCF. With no delays, investment flows for climate change
priorities could being from year 3 onwards. The tentative budget attached to this Action Plan is
US$1.5 million.
The actions concerning the second prong of this strategy relating to government planning systems
(the National Climate Facility) should be delivered in one geographical area comprising a set of
Districts relevant to the effective functioning of a watershed. The timeframe for this part of the
programme would be eight years working on the pilot, area-based approach with another two years
dedicated to scaling up to the sector and country level. A great many of the actions contained in the
Green Growth Framework for Fiji could be picked up in the proposed Action Plan; these are listed in
Section 6 of the report. The cost estimates for establishing the NCF provided here are tentative. The
exact details of the design of each of these measures with a more detailed costing should be carried
out in a detailed design phase of this Action Plan should this work progress.
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Contents Executive Summary .............................................................................................................................. ii Abbreviations and Acronyms ............................................................................................................. vi 1. Introduction ....................................................................................................................................... 1
1.1 Overview of the report ................................................................................................................ 1 1.2 Country context ........................................................................................................................... 1 1.3 Current spending on resilience ................................................................................................. 2 1.4 Trust Funds in Fiji ....................................................................................................................... 3 1.5. Experience with national climate Funds globally ................................................................... 4
2. What does climate change resilience mean? ................................................................................ 9 2.1 System analysis – the evidence base in Fiji ............................................................................ 9
2.3.1 Vulnerability to baseline climate events ................................................................................. 9 2.3.2 Observed climate change .................................................................................................... 10 2.3.3 Climate change projections .................................................................................................. 11 2.3.4 Environment-development baseline dynamics .................................................................... 12
3. Key elements in place to support the NCF. .................................................................................. 16 3.2 Legislative, policy and strategy framework ........................................................................... 17
3.2.1 Legislation ............................................................................................................................ 17 3.2.2 Policies and strategies ......................................................................................................... 19 3.2.3 Local government planning .................................................................................................. 26 3.2.4 Coordination on climate change policy ................................................................................ 27
3.2 Delivery effectiveness and challenges ................................................................................... 27 3.2.1 Public Financial management .............................................................................................. 28 3.2.2 Performance management .................................................................................................. 30 3.2.3 Human capacity ................................................................................................................... 32 4.2.4 Environmental and social safeguards .................................................................................. 33
4. Financing strategy for the NCF ..................................................................................................... 33 4.1 The importance of the enabling environment ........................................................................ 40 4.2 Climate change investment plans and costs ......................................................................... 42
4.2.1 Adaptation plans in Fiji and cost .......................................................................................... 42 4.2.2. Greenhouse gas emission mitigation plans and cost ......................................................... 45
5 Feasibility assessment .................................................................................................................... 46 5.1 Assessment framework ............................................................................................................ 46 5.2 Main design options ................................................................................................................. 47 5.3 Recommended design .............................................................................................................. 53
5.3.1. Monitoring, evaluation and learning .................................................................................... 54 6. Action plan for establishing the NCF ............................................................................................ 55
References ........................................................................................................................................... 61
Annex 1 Details of consultation mission for the preparation of this report ................................. 64
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TABLES
Table 1 Annual climate change and DRM assistance since 2008 (US$ million) .................................... 3 Table 2 Examples of Trust Funds operating in Fiji ................................................................................. 3 Table 3 Main characteristics of selected number of national climate change funds............................... 6 Table 4 Legislative, policy and strategy framework relevant to climate change in Fiji ......................... 21 Table 5 Comparison of adaptation measures identified for Fiji and Ministry of Agriculture performance
targets ................................................................................................................................................... 23 Table 6 Complementarity between baseline priorities in water, biodiversity and coastal zone and
adaptation options ................................................................................................................................. 25 Table 7 Correlation between Public Financial Management Performance and NIE accreditation
requirements ......................................................................................................................................... 29 Table 8 Categories of measures to manage climate change and the financing framework ................. 35 Table 9 Critical timeline of events for NIE accreditation in Fiji .............................................................. 37 Table 10 Policy measures to leverage private sector investment in Fiji proposed in the Green Growth
framework.............................................................................................................................................. 41 Table 11 Projected Cost of Recovery Programmes by Recovery Priority – F$ million......................... 45 Table 12 Main benefits expected from the NCF ................................................................................... 46 Table 13 Main risks from the establishment of an NCF ........................................................................ 46 Table 14 Typology of NCF design consequences ................................................................................ 47 Table 15 Action plan for establishing the NCF...................................................................................... 58
FIGURES
Figure 1 Environment, economy and climate change system linkages in Fiji ...................................... 13 Figure 2 Universe of private sector climate change investments ......................................................... 39 Figure 3 NCF at the MoE: 2 designs ..................................................................................................... 48 Figure 4 Benefits and risks from the two design options ...................................................................... 49 Figure 5 NCF at a bank; Multiple avenues for supporting investments ................................................ 50 Figure 6 Benefits and risks from the two design options ...................................................................... 51 Figure 7 Sequencing and timing of activities in the Action Plan ........................................................... 60
BOXES
Box 1 The Indonesia Climate Change Trust Fund: How well has it worked? ........................................ 5 Box 2 The private sector investment picture for climate change .......................................................... 34 Box 3 The Climate Bonds Initiative ....................................................................................................... 38 Box 4 Public funds unlock private finance: a cast study of adaptation in Uganda ................................ 40 Box 5 Global investor statement on climate change, 2014 ................................................................... 42 Box 6 Case study: Details of cost benefit analysis of adaptation options for Lami Town ..................... 44
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Abbreviations and Acronyms
AG Auditor General CCA Climate change adaptation CCU Climate Change Unit CSMRU Civil Service Management Reform Unit DFI Development Finance Institution DoE Department of Environment DRM Disaster Risk Management DRR Disaster Risk Reduction EC European Commission EIA Environmental Impact Assessment EMA Environmental Management Act GCF Green Climate Fund GoF Government of Fiji FDB Fiji Development Bank FDI Foreign Direct Investment FMA Financial Management Act FMIS Financial Management Information System FMR Financial Management Reform FNPF Fiji National Provident Fund GEF Global Environment Facility GHG Greenhouse Gases GW Ground Water INDC Intended Nationally Determined Contribution KPI Key Performance Indicators IWRM Integrated Water Resources Management LWRM Land and Water Resources Management M&E Monitoring and Evaluation MoA Ministry of Agriculture MoE Ministry of Economy MW Megawatt NCF National Climate Fund NGO Non-Governmental Organisations IPCC Intergovernmental Panel on Climate Change NCCAS National Climate Change Adaptation Strategy NCCP National Climate Change Policy REDD+ Reducing Emissions for Forest Degradation and Deforestation RSSED Roadmap for Sustainable Socio-Economic Development PEFA Public Expenditure and Financial Accountability Assessment PFM Public Financial Management SLR Sea Level Rise TC Tropical Cyclone UNDP United Nations Development Programme UNEP United Nations Environment Programme UNFCCC United Nations Framework Convention on Climate Change WRI World Resources Institute
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1. Introduction
The objective of this report is to assess the feasibility of establishing a Fiji National Climate Fund
considering issues such as capitalisation; legal, policy and planning frameworks and institutional
feasibility. The report has been prepared on the basis of 30 bilateral interviews with more than 70
informants and a stakeholder consultation workshop comprising 23 participants organised in the
period 6-14 June, as well as an extensive literature review.
The National Climate Funds (NCF) are nationally driven and nationally-owned instruments to help
countries collect climate finance from a variety of sources, coordinate them, blend them together and
account for them. Fiji’s Climate Public Expenditure and Institutional Review (CPEIR) recommended
that the country undertake a feasibility study for a Fiji NCF. This work is supported by United Nations
Development Programme (UNDP) within the context of the GCF readiness programme funded by
Government of Germany to prepare Fiji for direct access of the Green Climate Fund. The GCF was
established as an operating entity of the United Nations Framework Convention for Climate Change
(UNFCCC) financial mechanism and is expected to become the main global fund for financing climate
change mitigation and adaptation measures. The German Government, through the Federal Ministry
for the Environment, Nature Conservation, Building and Nuclear Safety (BMUB), has engaged the
United Nations Environment Programme (UNEP), UNDP and the World Resources Institute (WRI)
(“the Programme partners” or “the partners”) to develop a GCF Readiness Programme in nine
countries, including Fiji1.
1.1 Overview of the report Setting up a new institution or instrument is only worth the costs if it solves problems in the baseline
situation and does not create new problems, or at least that the positives should outweigh any
negatives. The first task is to take a close look at what the problems in accessing and implementing
climate finance are in the baseline situation. The second task is to look at the extent to which an NCF
in Fiji could improve the baseline situation. This depends on whether the system elements are in
place to support it and the design of the entity/instrument. Important system elements comprise the
legal, policy and strategic framework for climate change investments, transparent and accountable
financial management and performance tracking systems, and how well the implementation pathways
work. Cross cutting to these system elements is government capacity to produce integrated plans and
to guide implementation; this includes coordination between vertical levels of government and
between government and the non-State sector. This feasibility assessment looks at all of these
issues.
The feasibility assessment begins with introductory Section 1 that provides the background to the
design of the NCF in Fiji for example the Fiji experience in using Trust Fund instruments, current
spending on climate change responses in Fiji and a discussion on the experience with Climate Funds
globally for climate change. Section 2 sets out what we mean by climate change resilience and we
present what we know of the status of climate change resilience in Fiji.
Section 3 discusses the baseline institutional context for attracting and implementing climate change
adaptation and mitigation investment and the key institutional elements in place to support a NCF.
Section 4 discusses the financing strategy for the NCF which conditions the design of it. Section 5
presents the feasibility assessment and the recommended design for an NCF that minimises the risks
and maximises the potential added value of an NCF. Section 6 builds on the preceding sections
analysis of needs and gaps to present an action plan for establishing the NCF.
1.2 Country context Fiji is an archipelago of 332 islands (of which approximately 110 are inhabited), spread over a land
area of approximately 18,300km2 and a geographic area of almost 50,000km2. The country’s
population of approximately 865,0002 resides primarily on the two largest islands, Viti Levu and
1 The other countries being Benin, Colombia, El Salvador, Ghana, Kenya, Nepal, Philippines, Uzbekistan. 2 Population and Labour Force Estimates, 2014.
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Vanua Levu. Fiji has historically served as a regional hub for banking services and communications,
as well as for flights and shipping to other Pacific islands. Fiji is a middle income country with a gross
national income of US$4,870 per capita (World Bank 2014). Economic growth has averaged 3.2
percent over the last five years (World Bank, 2016) with stronger growth in the last 3 years3. The
economy is primarily based on services and tourism, but the majority of the workforce is employed in
agriculture. Tourism is the largest foreign exchange earner over the years. Sugar cane and non-sugar
agriculture are being supported for expansion in the government’s export promotion strategy.
Fiji faces some of the geographic and structural challenges common to other smaller Pacific island
countries, including vulnerability to tropical cyclones (TC) and resultant disasters. Remoteness, in
conjunction with internal dispersion, imposes additional costs trade and transportation-related costs.
These same factors also increase the cost and complexity of providing public services and fulfilling
some basic government functions.
While the country has achieved broad coverage in the provision of basic social services (e.g.
enrolment in primary education is almost universal), 35 percent of Fijians live below the basic needs
poverty line.4 44 percent of the rural population live in poverty, compared to 26 percent of the urban
population. Poverty is a multifaceted issue in Fiji, related to lack of access to a fully nutritional diet,
clean drinking water, improved sanitation, quality education and health care, and employment or
income earning opportunities. Climate change will have cross-cutting impacts and affect these
poverty indices across the board.
The return to Parliamentary democracy after successful elections in 2014 has boosted investor
confidence and contributed to foreign direct investment (FDI). FDI flows stood at US$278.9 million in
2014 (World Bank, 2016). Still, the World Bank economic freedom score, a composite index
measuring rule of law, government size, regulatory efficiency and open markets, is under the world
average (World Bank, 2016). The country has a trade deficit of US$126 million over exports of US$1
million and a net deficit of US$285.8 million (MoE, 2016; MoE, 2016b). 60 percent of expenditures in
2016 are operating and 40 percent are capital expenditures. Exports are declining and imports are
rising due to demand from the tourism sector and rising food and fuel prices, and the trade deficit is
widening. Import substitution and export promotion in sugar and agriculture is an important
development strategy for the GoF (MoNP, 2009).
1.3 Current spending on resilience As a share of Gross Domestic Product (GDP), Fiji’s total spending on climate change and Disaster
Risk Management (DRM) is estimated at around 1.26 percent and 1.08 percent of GDP respectively
in 2014. Government spending as a share of total expenditure on climate change and DRM is 3.6
percent and 3.1 percent (recurrent and capital costs) respectively over the same period (MoE, 2015).
This is equivalent to US$104.1 million and US$89.4 million for climate change and DRM respectively
in 2014. Most expenditures are for adaptation in the primary industries and on environmental projects.
Fiji’s reliance on donor funding is low with only 0.7 percent of its revenue coming from cash grants (US$ 9.5
million in 2014). Aid in-kind makes up 90 percent of total Overseas Development Assistance in Fiji (US94
million in 2014). Total spending on Disaster Risk Reduction (DRR), environmental protection and
mitigation in Fiji shows a big variation from year to year, probably reflecting the response and
recovery operations following a disaster, e.g. TC Tomas in 2010, floods in March 2012, TC Evans in
December 2012, TC Winston in February 2016, see Table 1 for details. Most climate change
adaptation donor initiatives focused on coastal and water management.
Most cooperation in Fiji is delivered as projects, some of it directly to communities through Non-
Government Organisations (NGOs) to communities which the government is unable to track. The
result is that national planning system have been largely bypassed. Poor regular reporting to
government by donors is also reported (MoE, 2015). As a result of this, development efforts are
uncoordinated, the benefits of the investments are unquantified and control of the budgets is in in the
3 Ministry of Economy budget speech reports the economy as having expanded 5.3 percent in 2014 and 4.7 percent in 2013 with the recent exercise of rebasing GDP to the year 2011. 4 Data from the 2013/2014 Household Income and Expenditure Survey.
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hands of donors. In addition, the ease of doing business for donors, e.g. in agreeing partnership
agreements, is onerous by some accounts, with delays of several months experienced at the Solicitor
General’s Office and at the MoE. The result is that getting funds to where it is needed the most for
climate change resilience is a slow process.
Table 1 Annual climate change and DRM assistance since 2008 (US$ million)
Three bilateral development partners have invested in the GCF and expect to see funding flows to the
Pacific region. At least one of these agencies is tasked for scanning whether such funds do indeed
reach the region. They indicated support of initiatives that facilitated greater draw down of funds to
the region from the GCF. It was noted that the GCF rules and potential windows for engagement are
in process of being developed and there was an opportunity for countries, through the GCF Board, to
influence how these rules develop.
1.4 Trust Funds in Fiji A number of trust funds are operating in Fiji. Table 2 summarises the main characteristics of these
Trust Funds. These experiences show that capacity and experience in managing Trust Funds is
present in Fiji.
Table 2 Examples of Trust Funds operating in Fiji
Fund Fund manager
Size and source of funding
Financing provided
Supports what Who implements
Sustainable Energy Financing Facility (SEFF)
Fiji Development Bank
World Bank 50 percent partial guarantee on the principle loan amount.
SEFF financing: FDB source. F$22.38 (US$11 m)
Loans or equity
Renewable energy and energy efficiency technologies
Private businesses
Global Fund for AIDS, TB & malaria
Ministry of Health
US$ 4 million grant
Public-private partnership/financial institution
Grants Prevention, diagnosis & treatment.
Public, private and NGO care providers
Fiji National Provident Fund (FNPF)
Executive management team
F$4.9 billion (US$ 2.35 million) in
assets and 403,000 members.
Pension contributions
Pensions Pensions -
iTaukei Trust Fund
Management team
Income from shares, debt notes and properties.
US$1 million
(2012)
Grants
2008 2009 2010 2011 2012 2013 2014 2016
0.589 1 8.684 4.235 24 15.153 7.592 14.369
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The main differences between the funds in indicated in Table 2 and a potential NCF is threefold:
1. the size of the existing Trust Funds compared with the potential needs of the NCF which
could be two or more order of magnitudes bigger;
2. the focus of the existing Funds, which are currently mostly single issue, e.g. low carbon
technologies generate direct GHG emissions mitigation results; whereas resilience to climate
change requires cross-sectoral cooperation between ministries.
3. Climate change is a dynamic risk, so learning and feedback of performance information into
plans and policies will be needed is an iterative planning process. Not only is climate change
a dynamic risk, but the socio-economic baseline is changing (population growth, expectations,
rising living standards, technology breakthroughs etc.), so the interaction of climate change
with development processes will be continually changing.
1.5. Experience with national climate Funds globally A NCF can be described as a place to pool funds and provide a mechanism for directing them
according to agreed climate change priorities. Funds can be structured as endowments, sinking
funds and revolving funds. An endowment fund is designed to last in perpetuity, preserving its capital
and using only the interest or return on investment to finance activities. A sinking fund is designed to
disburse a proportion of its capital each year over a defined period of time until it sinks to zero. A
revolving fund is replenished or augmented on a regular basis, usually through fees, taxes or levies
collected by government. In some countries, the fund has been set up as a Trust – a legal
arrangement whereby a trustee legally owns and manages financial resources exclusively for a
designated purposes (Bladon et al, 2014).
Over the last decade, a number of climate funds have been set up around the world to finance
investments that deliver climate change objectives. Common threads run through different climate
change Fund designs. They are usually sinking funds or revolving funds. Many offer loans as well as
grants; many are funded with domestic renewable resources (taxes) and they all link the funding to
projects, similar to the Global Environment Facility (GEF). The GEF was set up to fund the
incremental costs of global environmental benefits and the climate change funds entrusted to it by the
UNFCCC were to be focused on the costs of complementary and additional actions needed due to
climate change, with emphasis on mainstreaming of climate change into regular development
processes. These operational conditions were put into place to avoid duplicating or undermining
regular development processes. In practice it is difficult to separate out the climate change element
from the baseline dynamics, and the adaptation solutions implemented tend to address the system
dynamics as a whole. Table 1 provides details of climate change Trust Funds which have been set up
in (chronological order) Thailand, China, Benin, Bangladesh, Brazil and Tonga. There is very little
information on how well these climate funds have worked. One case study review of the Indonesian
experience is presented in Box 1.
In contrast, many Conservation Trust funds are set up as endowment funds with capitalisation of
between US$2.5 and US$17 million aimed at financing projects (Bladon et al,2014). The Tuvalu Trust
Fund, established in 1987, is an example of an endowment fund linked to a sinking fund which is used
as a budget support mechanism and widely viewed as successful. The initial capitalisation of Fund
was US$20 million equivalent including a contribution by the Tuvalu Government of US$1.2m. The
Fund grew to US$93 million (eq.) by March 2012. Further contributions were made (including by
Tuvalu Government of US$20 million). The Capital fund has never been drawn down in 20 years of
operation as of 2012.
In a review of Conservation Trust Funds, the following factors of success were noted:
1. Diverse sources of financing are critical for financial sustainability and to minimise the risks of
reliance on a single source of financing;
2. The Fund should nurture strategic relationships with a variety of stakeholders which can
provide mentorship, technical assistance and financial advice;
3. Independence is desirable but government support is essential;
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4. The Fund Board should have at least one member with expertise in the fields of finance,
business or economics. External assistance is also essential either through a specialised
advisory committee or through partners to the Fund.
Box 1 The Indonesia Climate Change Trust Fund: How well has it worked?
The Indonesia Climate Change Trust Fund (ICCTF) was the first national Trust Fund set up to
climate change objectives. It aims to enhance national ownership and to develop a structure to
access and channel grants in response to climate change. In practice its operationalisation has
been slow and its capitalisation has been low (US$11.4 million) relative to the hundreds of millions
of dollars of concessional donor support for climate-related purposes in Indonesia and the
estimated billions of US dollars it needs for GHG mitigation,. It was supposed to help strengthen
coordination and coherence in the country but it is now one of many actors in an increasingly
complex financing environment in the country.
Inefficiency of decision-making has been noted by many stakeholders, for example, the need for
senior ministry staff to sign off on decisions. The ICCTF project cycle takes about 13 weeks from
the time a call for proposals is issued to the point where the project is approved. In practice
approvals may take longer because of the approval process involving many stakeholders involved
in the Board and technical committee. The ability of the Fund to work well requires an
improvement in the capacity of the Secretariat which has been hampered by stretched resources
and high staff turnover. Steps have been taken to strength the Secretariat through recruitment of
Executive Directors and international experts in fund management. As of December 2013, 23.3
percent of total disbursed funds were spent on management costs.
A great deal of effort has been invested in fiduciary management arrangements. As the Fund
transitions into a third phase where it expects to finance larger programmes, there is a need for
greater public reporting and transparency of financial management systems, more robust risk
management systems and environmental and social safeguards.
Reference: ODI working paper, 2014
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Table 3 Main characteristics of selected number of national climate change funds
CC Fund Legal status and governance
Year established
Sources of revenue
Organisations eligible for support
Areas funded Number of Board Members
Permanent staff members
Committees
Thailand Energy Efficiency technologies
None. The Fund is an instrument designed to implement the Energy Conservation Act
2003 Petroleum tax revenues for the first 10 years. Participating banks are now investing their own funds.
Buildings, factories, energy service companies and project developments. Loans made available through 11 participating banks. Credit lines of US$2.5 million to US$10 million to each participating bank.
Low interest loans to banks which finance energy efficiency projects.
None. Department of Alternative Energy Development and Efficiency is responsible for implementation of the Act.
4 plus 25 part-time experts with an average work load of 10 hours per month.
China CDM fund
Government entity.
2007 Funded through share of CDM proceeds, investments, and grants. US$ 1.5 billion from 7 million tonnes of CO2 eq reduction (2012)
Line ministries and decentralised government
Grants,
investments
(equity), loans,
financing
guarantees.
No information.
No information. CDM Fund Management Centre (MoE): develops rules and regulations for the fund’s operation, makes investments, approves smaller investment projects; supervises and manages projects and reports to the Board.
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Benin National Fund for Environment and Climate
Legal Decree 2008 Ministry of Economy pays for operational costs. 50 percent of eco tax revenues (c. US$900,000k in 2011); fines from pollution control and government grants. Grants from development partners.
Public sector, private sector and CSOs.
Grant funding for small projects (c10k – 25k) to 90 percent of amount; medium projects (25k – 85k) to 75 percent of amount; and large projects (86k+) to 50 percent of amount.
7 Mostly Government.
7+ Executive Board: mandatory advisory group.
Indonesia Climate Change Fund (ICCTF)
2 Ministerial Decrees plus Presidential Regulations Interim trustee: UNDP Trustee: Bank Mandiri
2009 GoI: 1.27 million in 2015. Initiation capitalisation of US$11.45 million donor funds + $4.85 m in technical assistance support. Intention is to access private sector funding.
Line ministries, NGOs, private sector based on submitted proposals.
Innovation Fund – grants; Transformation Fund – loans 3 funding windows: Energy and Energy Efficiency; Sustainable Forestry & Peat Land Management; Resilience. Capacity development, policy and regulatory reform. Smaller projects (<$50K and larger: $1-2 million.
13 Multi-stakeholder but majority government.
c. 14. Includes Executive Director + 3 Deputy Directors
Technical committee: evaluates project proposals.
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Bangladesh Climate Change Resilience Fund and Action Plan (BCCSAP)
MOUs signed with donors. The Governing Council: sets strategic goals and management aligning the Fund with the BCCSAP Trustee: World Bank
2010 Initial capitalisation of US$100 million from multiple donors. Has reached US$180 million.
10 percent of
funding directed
to NGOs and
CSOs, managed
through a micro-
finance
institution.
Linked to National Climate Change Strategy and Action Plan. Finances resilience measures (biggest project US$19 million) and analytical and advisory projects (biggest project US$650k).
15 Multi-stakeholder but majority government.
No information. Secretariat is located at the Ministry of Environment & Forests and is supported by an extensive team of WB staff.
Management Committee: establishes the work programme and budget allocation, reviews grant requests and endorses reports. Expert panel: provides support on any technical aspect and review of proposals.
Brazil National Fund on Climate Change
Federal law and Federal Decree Trustee: National Bank for Social and Economic Development.
2010 Funded from a tax on profits made in the oil production chain. Other contributions are made from public, private, national and international donors. 2011-2014: 483 million approx Euros.
Multiple avenues, in accordance with national guidelines and an annual implementation plan of resources.
Grants and
loans.
Grants are
managed by
Ministry of
Environment.
Loans are
managed by the
Trustee.
Steering committee comprising federal, state and municipal representatives and CSOs. Steering committee manages, monitors and evaluates the fund
No information.
Tonga Climate Change Trust Fund
Climate Change Trust Fund Bill pursuant to the PFM Act 2002.
2012 Capital investment of US$5 million invested in an endowment fund of US$4 million and an operational Imprest Account of US$1 million.
Community groups, NGOs, government organisation. Govt is eligible only for 25 percent of funds for medium sized projects.
Small-medium grants from US$50K to US$250K for a 30 percent-70 percent funding ratio respectively.
Fund management undertaken by MoE and National Planning. Oversight provided by a Board.
1 Coordinator. No other information.
9
2. What does climate change resilience mean?
Household wellbeing is multi-dimensional and directly linked to human, natural, social, physical and
financial assets and livelihood strategies. Vulnerability to climate change is shaped by many factors
which reflect the absence of such assets such social exclusion, poverty, weak skills and low
education and others. Vulnerability is dynamic: a household vulnerability status can change rapidly if
its underlying stress conditions change. Its sources of resilience to enable shocks to be handled and
livelihoods to be re-built are include skills, relationship networks, physical assets and savings.
Repeated shocks lead to running down of assets with adverse consequences for household wellbeing
that persist often long after the shock has occurred. Coping in this way prevents households from
improving their economic situation and prospects.
The IPCC definition of vulnerability comprises three elements: i) exposure to the risk ii) sensitivity to
the risk and iii) adaptive capacity to be able to manage risks of climate change. The most vulnerable
households are those with assets and livelihoods that are exposed and sensitive to climatic risks and
who have weak adaptive capacity. For example a household may be exposed to sea level rise but
have the financial and technical means to build their house on stilts which will reduce their sensitivity
to the risk or to relocate which will reduce their exposure to the risk.
Climate change alters exposure to the existing risk profiles through changed frequency and intensity
of climate variability and slow on set events such as sea level rise, which change current average
conditions from historical ranges. Sensitivity to climate change will partly depend on the underlying
environmental and developmental conditions. Degraded environments will magnify the effects of
climate change by increasing the sensitivity of the environment and livelihoods in the area. This is a
critical point for the design of the NCF because, as the next section on systems analysis shows, in Fiji
vulnerability to climate change is being caused as much by development processes as the climate
hazard itself.
2.1 System analysis – the evidence base in Fiji The Green Growth Framework for Fiji recognises that the drive for economic and social development
has placed great pressure on the environment arising from changing consumption and production
patterns leading to the over-exploitation and degradation of environmental resources. Other national
strategies note that the process and rate of destruction of Fiji’s natural resources have become a
concern (MoASLR, 2006). The Green Growth Framework for Fiji argues the need for a new
ecosystems-based integrated approach because of the cross- cutting nature of development issues
with the environment. Ecosystem services are not measured and therefore not managed in a way
that benefits society.
The baseline degradation of the ecosystem underpinning economic activity increases the exposure
and sensitivity to climate change. In addition, negative feedback loops are observed. For example, the
total value of damage to environmental assets from TC Winston was estimated at F$233 million of
which 51 percent are damage to coral reefs, 37 percent to native forests and 12 percent to
mangroves. These resources are valuable barriers against storm surges5. Another feedback loop
was observed after TC Mick struck in 2009, which created a lot of debris from damaged trees. These
trees became fuel for indiscriminate fires that were sparked off in the hot and dry month that followed
TC Mick, which would normally have been expected to be wet. The aftermath of the fire events led to
invasive species growth taking place, which itself is more easily burnt the following dry season
resulting in a cycle of aggravating damage. The downstream effects of land degradation and erosion
were siltation and increased flooding (Sue, 2010).
2.3.1 Vulnerability to baseline climate events Even before climate change is factored in, Fiji faces exposure and sensitivity to climate-related risks,
mainly cyclones and flooding which are exacerbated by human factors. On average 1-2 cyclones
affect some part of Fiji every season. A decreasing trend in the number of cyclones and a slight
decreasing trend in cyclone intensity is observed in Fiji over the last 40 years. Between 1983 and
5 The total value of losses for these three environmental assets is approximately F$630 million.5
10
2012 Fiji experienced 106 natural disasters, mostly TCs and flooding. Since 1980, disaster events in
Fiji have resulted in average annual economic damage of around F$35 million and impacted around
40,000 people each year. TC Evan (a Category 4 cyclone) incurred damages and losses of close to
US$195 million primarily in tourism, housing and agriculture and compounded the damage
experienced by communities in Western Viti Levu from widespread flooding in the earlier part of 2012.
Total recovery and reconstruction costs for TC Evan were estimated at $134 million. TC Winston in
2016 caused damages of an estimated US$620 million6 with highest production losses in the
agriculture sector, some 65 percent of total production which will not recover in some cases for five to
10 years. The losses resulting from TC Winston have been estimated to reduce economic growth by
2.5 percent relative to the 2016 pre-cyclone forecast. Close to US$1 billion was estimated as the cost
of recovery and reconstruction. A poverty trap has been observed: disasters make Fiji poorer and
poverty exacerbate the scale of national disasters.
Intense rainfall and localised flooding in wet seasons is common during La Nina events whereas
strong El Nino events bring drought where annual rainfall can be reduced by as much as 30 to 50
percent over most parts of the country. Flooding occurs due to three issues: i) coastal flooding as a
result of storm surges or large waves ii) flash flooding from rapidly rising rivers, especially where
hillsides have been cleared of vegetation and iii) surface flooding where high rainfall pools in low lying
areas. Floods have occurred in Fiji in some catchments at frequencies of 10 years or more.
Recorded floods from the 1950s shows an increasing trend for all rivers in Fiji, though for the major
rivers the increase was small, possibly due to dredging efforts. Data confidence is low. Coastal areas
in Fiji that are flood prone are often affected by a combination of freshwater flooding and sea water
intrusion. Upland catchment degradation, leading to more flash flooding and more extreme high and
low flow events is believed to be a problem is developing certain catchments in the larger islands, e.g.
the Nadi catchment. Local and frequent flooding (frequencies of two years or less) results from
inadequate drainage infrastructure. The impacts of these events have been noted as follows:
Increasing frequency and severity of coastal flooding on large islands with loss of life and
damage to property, resulting from upland catchment degradation and inappropriate
downstream development;
Inland flash floods which have led to loss of life and property;
Storm surges and marine based coastal flooding, leading to erosion, loss of land value and
property damage;
Periodic drought resulting from El Nino which impacts on domestic water supplies and
agriculture in the northern and western parts of the two major islands and affecting the
smaller islands.
Drought of three months or more can severely affect the viability of forests and increase the
risk of forest fires, signalling a negative feedback loop.
The overall impact on small business by major flooding in Nadi in 2009 was estimated to total F$143
million (US$76.5 million) with a further loss of F$7 million (US$3.5 million) to households. The Nadi
Chamber of Commerce reported that 46 small businesses out of 250 closed down due to damages to
their businesses and destruction of stock.
2.3.2 Observed climate change Significant warming trends have been observed over the last 50 years: average annual air
temperature has increased by 1.15o C from 1961 to 2012 (ranging from 1.9oC in the warm season and
1.06oC in the cool season: 1.06). The minimum temperature has increased 0.62C. The overall change
in long-term rainfall trends over the last 50 years is an increase of 7.3 percent with slight decreasing
trend in the wet season and slight increasing trend in the dry season (GoF, 2014) though there is
substantial variation in year to year rainfall, and usually associated with El Nino Southern Oscillation
(ENSO).
Sea level rise of 19 centimetres was experienced globally from 1901 to 2010 but the mean sea level
at the Lautoka Tide gauge is changing at a rate of 4/6mm/year over the 1993-2010 period, which is
6 Loss and damages in productive, social and infrastructure sectors excluding environment sector.
11
far greater than the global sea level rise of 1-2 mm/year over the past century and significantly higher
than the rates observed at other locations in the South Pacific (GoF, 2012). Salt water intrusion into
coastal aquifers is already reported in coastal communities. On health, it has proved difficult, if not
impossible to detect the effect of climate change on health indicators due to data limitations (WHO,
2015). A direct relationship has been observed between droughts and floods and Dengue Fever and
diarrhoeal diseases. The outbreak of Dengue Fever in 2012 affected 24,000 of the islands’ 856,000
inhabitants. Ciguatera, a toxin found in reef fish, has been linked to higher sea surface temperatures
and ENSO cycles.
Last but not least, data shows that the level of ocean acidification has been slowly increasing in Fiji
waters. About one quarter of the carbon dioxide emitted from human activities each year is absorbed
by the oceans, which causes ocean acidity. This affects the growth of corals and organisms that
construct their skeletons from carbonate minerals.
2.3.3 Climate change projections The Intergovernmental Panel on Climate Change (IPCC) Fifth Assessment Report noted that
atmospheric concentrations of carbon dioxide, methane and nitrous oxide have increased to levels
unprecedented in at least the last 800,000 years, with carbon dioxide concentrations rising by 40 per
cent since pre-industrial times from 278 parts per million (ppm) to 391 ppm in 2012, primarily from
fossil fuel emissions and secondarily from net land use change emissions. Greenhouse gas (GHG)
emissions are emitted locally but the impacts are felt globally and felt disproportionately by the
poorest. Climate change will affect agricultural production and may become a threat to food security,
water resources, infrastructure and human health. But there are many gaps in climate and
vulnerability assessments for Fiji to date. For example, the impact assessment in the Second
National Communications (GoF, 2014) used much the same modelling data for the agriculture and
health sectors as was included in the initial National Communications (GoF, 2005). In addition, the
underlying environmental, social and environmental linkages need to be better understood, measured
and evaluated in order to be able to more accurately project how climate change might affect Fiji’s
development.
The most significant climate change effects are projected to be tropical cyclones and floods, as per
trends to date. (WRI, 2015). Projections indicate that while there may be a decrease in the number of
tropical cyclones, the average maximum wind speed of cyclones will increase between two percent
and 11 percent and there will be increase in rainfall intensity within 100km of the cyclone centre.
Surface air temperatures will increase by at least 2.5oC by 2100 at 1990 levels. A rise in temperatures
will affect coral health. Aragonite saturation needed for coral growth and reef ecosystem development
has fallen from 4.5 pre-industrial to about 3.9 by 2000 (WRI 2015), compounded by storm surges
which are projected to increase in frequency and intensity. Current understanding of projected
changes to precipitation in Fiji is weak. Total annual rainfall is projected to be similar but more
concentrated in the wet season, falling in more intense events.
On current global GHG emissions trajectory, the additional global sea level rise could be as high as
82cms by 2100 (IPCC, 2013), though there is significant uncertainty surrounding ice-sheet
contributions to sea level rise. This level of SLR would lead to increased coastal erosion due to
concurrent action of storm surges. Sea level rise will primarily affect cities and towns in Suva, Nadi
and Lautoka and others. It is estimated that 1150 to 2300 hectares of land on Viti Levu (equivalent to
2 to 4 percent of land below 10 metre elevation) could be lost by 2050 due to sea level rise (DoE,
2011). The Impact on coral reefs is estimated at +US$5-14 million per year in lost fisheries, habitat
and tourism. SLR may results in up to 5 percent of Fiji’s sea grass in deep water by 2035 and up to
20 percent by 2100 (MoSPNDS, 2014)
While the direct effects of raised levels of CO2 are likely to benefit mangrove productivity (MMP 2013),
sea level rise is likely to lead to mangrove mortality as long as mangroves cannot migrate inland due
to sea walls and land developments. A reduction in mangrove areas will have knock-on effects on
coral reefs, sea grass and nearshore terrestrial habitats, effecting the extent and productivity of
inshore waters and coastal habitats (Mangrove Management Plan (MMP) 2013).
12
Climate change may result in a 5 percent loss of Fiji’s sea grass by year 2035 and 5 to 10 percent
loss by 2100. Variations in tuna catches have been observed in in El Nino and La Nina years and may
be exacerbated by climate change. Changes in migration patterns and depth of fish stocks affect the
distribution and availability of tuna during such periods (WRI, 2015). The impact of increased ocean
acidification will be compounded by other stressors such as coral bleaching (though increased sea
surface temperatures), storm damage (which in itself could be exacerbated by climate change) and
fishing pressure.
There are multiple pathways between these primary changes and how they might impact on
livelihoods and the economy. Potential health pathways are through a higher incidence of droughts,
floods and higher temperatures which will affect water security, food security and pathogen transmittal
through food and water. For example, salmonella, typhoid fever and leptospirosis may increase with
higher temperatures and higher rainfall. Respiratory diseases can be exacerbated by hotter weather.
Links are also being made with an increased risk of non-communicable diseases (diabetes, cancer
etc.) due to detrimental impacts on local agriculture, post-disaster reliance of processed food and
hotter temperatures discouraging exercise. Projected change in the variability and absolute amounts
of rainfall is likely to affect hydro-electricity production, the loss of beaches as well as flooding and
degradation of coastal systems will impact on tourism.
2.3.4 Environment-development baseline dynamics What follows in this section is a description of the environmental and development system dynamics
in Fiji which are a major source of sensitivity to climate variability and change. To minimise the
impacts of climate change on people, ecosystem function will need to be working reasonably well,
even before adaptation measures are implemented. In order to be effective, measures to build
resilience and adaptation to climate change need to address these system vulnerabilities to be
effective. How a potential NCF interacts to address the effects of these baseline dynamic processes
should be one the main considerations in its design.
Environment-livelihoods ecosystem dynamics can be discerned in two spheres. The first is the land-
based sphere, the second is the coastal area sphere. Both are connected, for example, the
conditions of the reefs and marine fish stocks are affected by freshwater withdrawals and by
deteriorating quality of outflows of silt and water into the marine zone. Freshwater and inshore
fisheries are connected directly: 10 to 12 percent of Fiji coral reef fish use freshwater ecosystems at
some stage of their life cycle while nearly 97 percent of Fiji freshwater fish use marine and estuarine
water during the lifetime. In addition the population of Fiji is 865,0007 and is projected to reach one
million by 2030. There is mounting pressure on land and fisheries resources to service the growing
demand (MoSPNDS, 2014).
Figure 1 is an illustration of the environment, economy and climate change system linkages. Climate
change resilience needs to be considered in the context of the underlying system dynamics and
vulnerabilities which are in themselves caused in most part by the way that development processes
are interacting with ecosystems to affect ecosystem function and the ability to mediate climate
change. In Figure 1, the climate change hazards are depicted in purple. The four main environmental
assets that are critical to how climate change impacts are felt are the forests, river courses, the
mangroves and the reefs, indicated in red. The latter two environmental assets form a natural
protective barrier to the islands of Fiji but are being degraded and destroyed in a number of ways.
Figure 1 shows the complexity of the system dynamics and the basic message is that there are
multiple pathways that could transmit climate change effects. Building resilience to climate change
has to consider how the baseline development investments and strategies impact on the exposure
and sensitivity to climate change and the behavioural changes that can and should be made, together
with investments in adaptation technologies and practices.
One of the problems in integrating the environmental dimension into development plans is that
resources are constrained and the environment is seen in Fiji as a development dimension that can
be managed after development has taken place (DoE, 2010;, Prasad, 2003). The potential impacts of
7 Population and labour force estimate, 2014
13
climate change as an additional stressor to development challenges requires pause for thought to this
perspective. Balancing the short-term gains with long-term productivity does not mean that
development must stop but rather it requires investments to be designed differently, for example, a
rational way of land-use planning, ensuring the proper design of roads and investment into soil
conservation. The solutions are known, what is lacking in many cases will be the political will to make
the required changes, as indicated in many national natural resource strategies in Fiji. Data to
quantify how investments in adapted investment design pay off are urgently needed and properly
targeted information could help to create awareness and build support for resilience building. For now,
some of these system linkages may be appreciated by some policy makers and investors but
stakeholder interviews carried out in the preparation of this report show that most policy makers do
not understand the entire system dynamics in play.
Figure 1 Environment, economy and climate change system linkages in Fiji
Ref: Own source
Land-based sphere Everything above the blue shadow line in Figure 1 (illustrating the coastal shoreline) can be referred
to as the land-based sphere. The main two environmental assets that mediate the effects of climate
change are forests (on steep lands) and river courses. Forests are converted to profitable enterprises
(profitable in the short term), mainly road construction, agricultural and timber production and
expansion of settlements. But the environmental costs are not taken into account in decisions on
forest conversion. Soils wash down from the upper slopes due to road construction and land
clearance for agriculture and gravel and sand extraction taking place downstream change the depth
and stability of river courses. Reduced flow regulation from cleared slopes compounds the problem of
heavy rainfall events which are projected to become more pronounced by climate change, leading to
flooding. Deeper river channels increase the flow of sea water intrusion, which is particular problem
given sea level rise projections. These processes are facing increasing pressure from population
growth, the demand for land area for settlements and greater agricultural productivity.
Around 70 percent of land in Fiji is classified as steep land on the two main islands of Fiji (MoAFF,
2007). The Erosion index is high by world standards and extreme care is required in agricultural land,
irrespective of soil type; land with slopes greater than 8 degrees gradient would be considered
incapable of growing sugar without unacceptable damage (MoAFF, 2007). Soils that are suitable for
14
agriculture are already being used for agriculture. Small scale clearing of natural forest on steep, less
arable slopes is happening at a high rate due to smallholder agriculture, the spread of small villages
and settlements, urban growth and infrastructure, (roads, dams, bridges, reservoirs), fire and poor
logging practices.
The three main drivers of deforestation are agricultural development, infrastructure development and
settlements expansion. Forest loss impacts the environment through a host of pathways included
degraded water quality from poor logging practices, loss of shading, loss of biodiversity, spread of
freshwater invasive, sediment deposition of coral reefs and loss of important habitats for endemic
plants and animals which all increase vulnerability to climate change. Degraded forests open up the
way for land clearance for agriculture (MoAFF, 2007) and for the spread of highly invasive species
(Haas, 2015). Thus land degradation is an accelerating process.
The poor adoption and application of land husbandry practices and the resultant degradation of land
and water resources makes the impact of natural disasters becoming more acute and increases
vulnerability to climate change. Sugar cane cultivation is responsible for most widespread land
degradation. On Viti Levu nearly 15000 hectares of sugar cane have already been identified as
requiring urgent soil conservation work and a further 6500 hectares would be retired from sugar cane
and put to a less erosive from of land use (MoAFF, 2007). The country’s high dependence on the
sugar industry and its quota and incentive system encourage cane farmers to move into steeper
slopes and to use soils without care. Over a short period of time these areas experience soil
depletion, soil moisture deficits and decreasing productivity. Soil loss measurements clearly
demonstrate that the agricultural productive base in many sugar cane areas is declining at a rate that
is well above what would be regarded economically acceptable. The small size of land holdings (less
than 3 hectares ) forces farmers into intensive cultivation for high output, short term production with
minimal or no fallow periods. This produces soil erosion, loss of plant nutrients, increased pest and
disease infestation, reduction in soil depth, decreased soil water-holding capacity and rill and gully
erosion8. Tractors cause compaction of the soil and results in poor crop growth and low infiltration
rates during heavy rain, which manifest as flooding and represents another dynamic that is
exacerbated by climate change. The commercialisation of livestock farming without good pasture
management leads to overstocking and soil erosion on marginal land areas.
Off-site effects include increased siltation in the river systems, formation of mud banks, reduced
navigability of rivers, and destruction of fish spawning areas, reduced fish populations and flash floods
during heavy rains which exacerbates the impacts of climate change. The latter causes damage to
infrastructure costing millions of dollars in rehabilitation and destruction of coral reefs. The leaching
and overland flow of the fertilisers and farm chemicals into rivers and ground water causes water
pollution, reducing resilience to climate change through various pathways. The accumulation of
tonnes of animal waste finds its way into the river systems and pollutes them. Soils in Fiji are volcanic,
naturally acidic due to high rainfall and fragile and require fertilisers to counteract nutrient loss, which
further increases acidity. Indiscriminate application of chemical fertilisers and pesticides can and do,
however, pollute river courses and eventually inshore areas with livelihood impacts. This is important
because it contributes to water scarcity and reduces resilience to climate change because
contamination makes plentiful water supplies unfit for drinking or for agricultural purposes as well as
downstream impact on coral reefs (MoAFF, 2007).
Roads impact healthy rivers and watersheds as they are the largest source of sediment to streams
and can block upstream and downstream movement of aquatic life, and they act as pathways for
exotic species. The unplanned alignment of logging roads provokes erosion on road embankments.
Logged areas cause soil erosion which results in warmer and less oxygen rich water with an
unbalanced nutrient load. Gravel extraction (for the construction industry) increases channel velocity
causing more intense flooding downstream. Over-extraction of upstream river material transforms
Fiji’s natural river systems into a smooth culvert like course with a lower river base which result in loss
8 For example, research has shown that soil loss rate on a ginger plot where no conservation is practice leads to a loss of 50 tonnes of soil per hectare annually which could be reduced to 1 tonne per hectare annually with low sustainable land management technologies such as vetiver grass as hedge rows.
15
of habitat for aquatic fauna, larger and more frequent flooding at the river mouths which is now
evident in Nadi and Labasa in recent years and the effects of which will become magnified with
climate change. The changes to river courses also cause the break-down of infrastructure such as
bridges, Irish crossings, culverts and irrigation offtakes due to the inability to withstand the impacts of
the lowered base course of rivers, another dynamic which will be affected by climate change. Over
1.2 million metric tonnes of hard rock, sand and gravel has been removed since 2008 which is
believed to have had a negative impact on the natural ecosystems of rivers and the coastal
environment (MoSPNDS, 2014). Over one third of all freshwater systems are ranked as highly
impacted.
Land-based activities affect freshwater systems which affect coastal inshore systems. For example,
eutrophication in urban streams from agricultural activities kills aquatic life and affects downstream
ecosystems such as reef systems. Algal growth has been round in many Fiji reefs, through the
causes of this have not been fully established. Riverine systems have an average of 11 more native
fish species than degraded watersheds which play an important role in the diet and livelihoods of
inland communities and have been declining in recent years, impacting food security.
Coastal-based sphere All of Fiji’s urban areas and an estimated 690,000 of Fiji’s 900,000 population live within 30 kilometres
of the country’s surrounding reefs, as well as all its major industries. About half of Fiji’s population are
urbanised and this figure is expected to increase to 70 percent by 2050. Pollution and infrastructure
expansion affects the coastal and inshore environment negatively, which increases the sensitivity of
Fiji to climate change impacts. Sediment load, poor waste water management systems and urban
storm water contribute to the problem. River mouth dredging to reduce flood risks, sedimentation
from the construction and growing mining industry, and sand mining for the construction industry also
contribute to the destruction of mangroves and degradation of sea grass and coral reefs. The
estimated volume extracted from the Laucala Lagoon alone averages 700,000 to 120,000 tonnes
annually since 1962. Heritage sites are not spared. Coastal erosion has become significantly more
evident in Fiji in the last 50 years. Very little is known about the rates of erosion and the effectiveness
of activities attempting to stabilise the shoreline and beaches. The clearing of mangroves and coastal
vegetation exacerbates coastal erosion and increases sensitivity to climate change.
The construction of roads, bridges, ports and major buildings in coastal areas has modified nearshore
bathymetry, increasing the size of waves hitting the coastline (DoE, 2011) leading to coastal erosion
and vulnerability of settlements and people and opening the way for more negative impacts from
climate change. Most of the artificial coastal protection structures in Fiji have been poorly designed
and short lived due to structural failure from toe erosion, leaning and loss of backfill, which negatively
affect the ability to protect coastal assets from the effects of climate change.
Reefs are important in supporting fisheries and a source of coastal protection but are affected
eutrophication, coastal development, mangrove clearing and overfishing. Over-fishing can cause
deterioration in coral reefs which has further reaching consequences on other species. Over 70
percent of Fiji’s reef fisheries (which are divided into traditional management units called qoliqoli) are
fully exploited or over exploited. Though Fiji’s reefs have proved to be resilient in the mass bleaching
event of La Nina event of 2000, the ability for Fiji’s reefs to withstand and recover from climate change
stressor will depend partially on fisheries management and management of human pressures such as
land use and watershed management. In urban areas and areas of intense agricultural activity, reefs
have been shown to be less resilient.
Seagrass is important for Fiji’s coast because they are highly productive, for example, it is estimated
that 400 m2 of sea grass can support 2000 tonnes of fish but it is also affected by sewage and other
waste water pollutants, coral extraction, river siltation, coastal erosion and storm surges and
excavation of channels for tourism developments (DoE, 2011; MoSPNDS, 2014). Seagrass plays an
important role in carbon sequestration.
Mangroves are found along estuaries, river banks and lagoons. They provide nutrients and protection
for reefs and sea grass beds and are a major nursing area for fish and birds. The estimated value of
mangrove-associated fisheries in 1983 was F$21.8 million (US$10.9 million) or F$566/ha (US$283).
16
Crustacean, mollusc and beche-de-mer resources are negatively affected by removal of mangroves.
Mangroves perform a vital coastal stabilisation role by trapping sediments which both control the
erosive action of waves and currents as well as reducing silt loads and toxins that can potentially
reach and kill coral reefs. This has obvious resilience benefits regarding climate change. Mangroves
areas declined by 5 percent between 1991 and 2007, mostly in urban areas which saw a 40 percent
decline in the Suva peninsula and Lami area between 1991 and 2007. This is largely because of
clearing for urban expansion and tourist development. They are sometimes cut down prior to
development being approved or funded resulting in vacant lots of no biological or economic use. This
is destroying Fiji’s mangroves at an alarming rate (DoE, 2013; Doe, 2011). Other pressures are
unsustainable harvesting for wood and building materials, excessive sediment discharge from
unsustainable logging and agricultural practices upstream, creation of waste disposal sites and
disposal of dredging material. Many of these processes are unmanaged, e.g. illegal mangrove felling
for fuelwood in the Southern Division of Fiji may be around 50 percent of recorded production. EIAs
should be carried out for commercial mangrove harvesting but are not enforced (MMP, 2013). In
Labasa, 15-20 ha of highly productive mangrove appear to have been killed by uncontained spoil
disposal direct into the mangroves. Similar extensive mangrove fatality has occurred in the Rewa
delta as a result of dredge spoil disposal. Mangroves have been shown to be the most carbon-rich
forests in the tropics, containing on average 1,023 Mg carbon per hectare, an order of magnitude
more than terrestrial tropical forests (MMP 2013).
The challenges around the sub-optimal management of the environmental base matters for climate
change resilience, because degraded or changed environmental resources magnify the impact of
climate variability and climate change. These challenges will become bigger as the population
increases and as the drive for economic growth and raising of living standards progresses. The
mainstreaming of climate change adaptation into sector spending plans, policies and strategies is
required in order to ensure that all financing is contributing to building resilience to climate change.
3. Key elements in place to support the NCF.
Fiji has some of the basic building blocks in place to establish the NCF: a couple of pieces of
important legislation relevant to the governance of environmental resources; a financial management
information system; a financial management reform process underway; a performance management
system that connects the work of the Ministries to the Ministry of Economy; Permanent Secretaries
who are held to account for their Ministry’s performance on the basis of agreed annual targets and
could provide political leadership for an integrated planning effort; national experience in running trust
funds and in implementing sophisticated resources mobilisation strategies; strong partnerships with
other Pacific Island Countries which affords good learning exchange possibilities; and human
resources which are a good basis for capacity development measures.
There are also many weaknesses. The lack of integrated planning between ministries is a serious
constraint to designing and implementing adaptation strategies, given the linkages between climate,
energy, food and agriculture, water, forests, health and urban planning to name but a few. Underlying
this is what appears to be a lack of political will across the Government to implement the
recommendations in the numerous natural resource-based strategies which recognise the links
between environmental degradation, climate change resilience and sustainable development. The
National Climate Change policy indicates areas where mainstreaming and planning improvements are
needed but the mid-term monitoring report concludes that very little progress has been achieved
across the eight objectives of the National Climate Change Policy. This was partly attributed to weak
leadership and management by the CCU, for example in tracking and reporting progress of the
NCCP, and the lack of financial support. Corporate commitment to the implementation of the NCCP
was found to be low in the mid-term review.
Perhaps the most important element that is needed for the NCF to work is leadership to implement
policies, enforce legislation, to promote cross-government working and maintain commitment to
quality and performance in planning and implementation systems. Enforcement of legislation, codes
and standards is weak in Fiji as reported in many strategies reviewed for this report.
17
During the stakeholder workshop a stakeholder workshop was held which identified the challenges in
in establishing the NCF to be as follows: silo-type planning and weak voice from communities in
planning processes which affects the effectiveness of government investments; mis-management of
funds and political interference; slow delivery. The main barriers were seen to be political stability;
politicised planning and budgeting systems; and a lack of performance data and management.
In order to attract international financial flows through government systems, which would be needed
to build a system that could accept larger scale flows, planning and public financial management
practices have to be of a certain standard. Budget support9 requires good country systems to collect
information and provide statistics, monitor progress, evaluate impact, ensure sound results- focused
public financial management, transparent reporting and public accessibility of information. Clarity in
the choices of indicators and targets as well as on resource requirements are important elements for
the reliability of the system.
3.2 Legislative, policy and strategy framework A prospective NCF needs enabling legislation as a cornerstone for the governance of the natural
resources sector: what can and cannot be done and the manner in which natural resources may be
used or converted. For legislation to be effective, it needs enforcement capacity to ensure compliance
but enforcement on its own is costly. Legislation needs supporting policies as the framework for
directing public and private sector resources to the sector and a budgeted organisational strategy and
action plan. It also needs enabling factors such as awareness to raise levels of intrinsic motivation,
economic incentives, human resource capacity and capability and good performance management
systems. Many of these basic building blocks are missing in Fiji or there are significant weaknesses
which would need to be addressed for the effective and efficient functioning of an NCF.
3.2.1 Legislation It would be fair to say that the legal framework in Fiji to guide climate change resilience is weak as
many of the relevant laws are more than 30 years old and so resilience principles (e.g. managing for
variable environmental conditions which are expected to become pronounced with increasing levels of
climate change) are not likely to be reflected as the basis for natural resource use, as well as there
being some significant gaps. There are also many separate laws relevant to some ministries, e.g.
Ministry of Agriculture has over 33 laws that it is responsible for implementing. The problem is that
when individual management objectives are broken down into such small pieces, the sustainable
resource use objective (in aggregate) gets lost. In this instance, the 2020 Agriculture Sector Policy
Agenda recommends consolidating the law into an omnibus legislative Act, which should also include
the water resource management. Any legislation on natural resource use should be based on
technical information regarding resource quantities and sustainable use rates, particularly in light of
the climate change stressor.
The national legal platform is the 2013 Constitution which declares the commitment to social and
economic well-being and safe-guarding the environment, and the right of Fiji citizens to a clean and
healthy environment protected for current and future generations. In addition, Fiji has one important
piece of legislation in place and one important piece of legislation that is waiting for a third hearing in
Parliament.
The Environment Management Act (EMA), 2005 establishes a National Council for Sustainable
Development (not convened for the last two years due to internal issues) tasked to meet four times a
year, with membership from ministries responsible for land, mineral resources, agriculture, fisheries
and forests, health, tourism, the President of the Local Government Association, a representative
from an NGO, two members from the business community and a representative from the academic
community. The National Council on Sustainable Development is tasked with approving and
overseeing the implementation of a National Environment Strategy and to ensure that environment
and development commitments are implemented.
9 Defined as recurrent, predictable development policy lending in a medium term programmatic setting (World Bank, 2005)
18
The EMA requires the Department of Environment (DoE) to establish four units: Environmental Impact
Assessment (EIA), Resource Management, Waste Management and Pollution Control unit. The EMA
includes a provision for the establishment by other government entities, if required by the DoE, of
environmental management units to formulate environmental policy statements, develop natural
resources inventories and a resource management plan as well as conduct internal environmental
audits. The EMA also sets out a requirement for any government entity responsible for the
management of any natural resource to implement a system of natural resource accounting designed
to quantify in financial terms i) the resource capital administered by it ii) an expenditure incurred
during the audit period in relation to exploitation, extraction or use of the resource and iii) any
resource loss resulting in the audit period.
Required outputs are the National State of Environment Report, which was finalized in 2013 and still
waiting to be released by Cabinet. The National Environment Strategy has not yet been updated
since 1993. The Natural Resource Inventory and National Resource Management Plan either have
not yet been prepared or were not yet accessible at the time of writing this report.
The other important and potentially enabling piece of legislation is the Land and Water Resources
Management Bill 2016 which is intended to promote the implementation of sustainable land and water
resources management practices. It offers a more coherent and coordinated mechanism to monitor
and control the quality of land and water resources and safeguard against their degradation. Some of
the main characteristics of it are that:
It establishes a land and water resources management Board to i) plan and implement
sustainable use of land and water resources ii) facilitate coordination and cooperation
between the land and water use planning activities of government agencies, communities and
industry groups iii) appoint sub-committees as necessary to undertaken land and water use
planning and to provide technical advice iv) advises the Minister on the formulation of
regulations necessary for the conservation and improvement of land and water resources.
The Board is accountable to the Minister responsible for Agriculture and its members of the
Board shall consist of a land and water management expert appointed by the Minister to be
Chairperson, the PS Agriculture, the Director of Environment, an NGO representative and
four farmer representative from the four administration Divisions.
Land and conservation officers will be appointed
Every land and water use plan should involve i) integrated land and water resources planning
in order to manage catchments and sub-catchments ii) flood plain management iii) river and
stream management iv) water use allocation for the flows and reserves in a river, stream or
aquifer.
There are also gaps in the legislation. Most noticeable is that there is no legal framework on
integrated water resources management (IWRM)10. IWRM is important because it recognises that
water is a resource with finite limits (though renewable) dependant on rainfall (which is seasonally
variable), all other things being equal. It also requires that a water resources management strategy
allocates water on a set of agreed principles which should include priority access for domestic use
and the environment (i.e. minimum low flows to protect aquatic ecosystems) together with allocation
to productive activities that have the highest benefits for society. Water pricing is used to induce
efficient use of water, i.e. limit wastefulness. The legislation in Fiji covers various water services but
does not recognise environmental limits and the need to manage water according to those limits. For
example, the Rivers and Streams Act, which dates back to colonial times, provides for local
authorities to approve water abstraction from rivers but not according to any recognised
environmental limit. The draft water resources policy for Fiji indicates that, though Fiji has plentiful
water resources overall, the available resources are not plentiful in all places nor at all times. Some
10 IWRM is defined as a ‘process that promotes the coordinated development and management of
water, land and related resources in order to maximise the resultant economic and social welfare in
an equitable manner without compromising the sustainability of vital ecosystems‘(SOPAC
Miscellaneous Report 637).
19
areas have limited water. Climate change will affect water resources through changes in rainfall
patterns in a context of growing populations and increasing living standards which imply increases in
water consumption per capita.
Apart from that, a review of the various laws and ordinances that control the nations’ water and land
resources is needed in order to be consistent with the requirements of the 2005 EMA (MoAFF, 2007;
DoE, 2011). No less than 12 pieces of legislation in existence are relevant to land development and
conservation which are administered by different government agencies and have overlapping function
(MoAFF, 2007). This review should be done on the basis on agreed policy principles that reflect
environmental resources as being finite and the need to optimise natural resource management and
conserve them for future productive use. For example, principles that were established in the Rural
Land Use Policy which could be drawn on are as follows:
Use of land resources should not cause their degradation or destruction because human
existence depends on the their continued productivity;
Priority must be given to optimising land use to maintain and improve soil productivity and to
conserving soil.
As important, it has been noted in various government development strategies that there is very poor
public understanding in the rural sector about various land-related legislation. Field officers are often
not informed about new legislation or strategies. There is no clear technical guidance. And there is
poor understanding about the magnitude of land degradation. There have been no public awareness
programmes. And so it is not surprising that enforcement of legislation and regulations does not take
place. In addition, the level and standards of technology transfer from officials to farmers in
inadequate on matters of land use diversification and intensification, farming systems and their
development needs, costs of inputs, gross margins, post-harvest support and marketing (MoEF,
2007; MoASLR, 2006).
3.2.2 Policies and strategies The People’s Charter for Change, Peace and Progress in 2008 set out clear guidelines for building a
sustainable and efficient development model. The 2010-2014 RSSED establishes a strategic
framework to achieve sustainable democracy, good and just governance and socio economic
development. The RSSED has the following goals which are directly relevant to climate change
adaptation and GHG emissions mitigation:
Effective management of land resources while ensuring sustainable development;
Sustainable development and management of forest resources;
Pursuing growth through sustainable mineral and groundwater resources management;
A resource efficient, cost effective and environmentally sustainable energy sector;
Sustainable management and utilisation of Fiji’s natural resources;
Building national resilience to disasters and adapting to climate change
The system of Key Performance Indicators (KPIs) was established at ministry level to monitor national
RSSED implementation and to review and evaluate the performance of government agencies. No
comment can be made as to the adequacy of the KPIs in play since most of the 2015 Corporate Plans
were not available at the time of writing this report. The KPIs should be looked at critically to see if in
aggregate they deliver the RSSED goals relevant to climate change resilience. The discussion below
and Table 5 (below) highlights the gaps in the MoA KPI framework.
The Green Growth Framework for Fiji sets out 10 thematic areas to progress sustainable
development, recognising that the backbone of the economy and employment is environment and its
resources, that many aspects of development are cross cutting and inter-linked and that the solutions
will depend on meaningful partnerships between people and between agencies. The guiding
principles of the Green Growth Framework include:
Improving resource productivity (doing more with less);
Developing a new integrated approach reflecting the cross-cutting nature of issues relating to
sustainable development;
20
Adoption of environmental auditing of past and planned developments in order to increase
win wins in terms of economic and environmental benefits;
Providing incentives for investments which support the efficient use of natural resources.
A number of other sectoral policies and strategies set out priorities and measures that are relevant to
ecosystem management and/or climate change resilience. These priorities and measures in various
documents such as the Disaster Risk Management strategy for the agricultural sector, the Fiji
National Strategic Development plan, the rural land use policy, the Fiji Forest policy and others have
been analysed and set out in tables in the NCCAS. The main issue is one of lack of implementation
which requires that these priorities are reflected in departmental and ministerial performance plans
and budgets.
A major gap and challenge for effective adaptation planning is that Fiji does not have an integrated
national land use plan. Only urban areas, which are a small portion of Fiji’s land area, are covered by
an authorised planning scheme or master plan. Other non-urban areas are planned under the iTaukei
Native Lands Act. Land is registered to traditional land-owning groups that has customary right to use
and occupy the land. Many Fijian villages have to varying degrees developed their own resource
management plans. But the issue is one of managing land in aggregate, recognising the ecosystem
impacts upstream and downstream and according to management goals that are based on
sustainable resource use, i.e. maintaining stocks of environmental resources in sufficient quantities
for future use and income generation. The absence of an integrated land use plan is a major
constraint to the wise allocation and management of resources and is of critical important as it covers
all land based resources such as forests, agriculture, minerals, rivers and streams (MoASLR, 2006).
The current administrative framework for resources allocation and management is highly fragmented
along sector lines, with reported tensions which has in turn promoted unsustainable use of resources
(MoASLR, 2006).
Table 4 summarises the legislative, policy and strategy framework relevant to climate change in Fiji.
The Table shows that there is a range of legislation relating to the various sectors, most of it outdated
(as indicated above) but very few policies in place. There are more strategies and plans in place than
policies but many of the recommendations are not implemented for a range of reasons including
political will, capacity and finance.
21
Table 4 Legislative, policy and strategy framework relevant to climate change in Fiji
Acts relevant to climate change resilience Supporting policies
Supporting plans
- - Road-map for Democracy and Sustainable development Socio-economic Development 2010 – 2014
A Green Growth Framework for Fiji: Restoring the balance in development that is sustainable for our future, 2014
Disaster management
Natural Disaster Management Act, 1988 Disaster risk reduction and disaster
management: a framework for action 2005 - 2015
Climate change -
National Climate Change Policy 2012
National Climate Change Adaptation Strategy for Land-based Resources.
National Climate Change Action plan, 2012
Environment
Environmental Management Act, 2005
EIA process regulation, 2007
Waste Disposal and Recycling Regulation, 2007
Endangered and Protected Species Act, 2002 and Regulations (2003)
National Environmental Strategy (1993)
National Biodiversity strategy and Action Plan, 2010
National Climate Change Strategy, Final Draft (2012)
Fisheries
Fisheries Act, 1988 and Amendment, 1991
Agriculture
Agricultural Land and Tenant Act, 1985
Drainage Act, 1985
Pesticide Act, 1985
Irrigation Act, 1985
Stock improvement Act, 1985
Biosecurity Act, 1985
Fiji Food and Nutrition policy, 2008
Standard operating procedure for DRM and CCA in Agriculture, 2015
Water
Water supply Act, 1985 Rural water and
sanitation policy, 2012
National water resources policy for Fiji Islands (initial draft)
Mining
Minerals Act, 1978
Quarries Act and regulations, 1985
Offshore Mineral policy (draft)
Forestry
Forest Act, 1979; Forest Decree, 1992 Fiji Forest Policy, 2007 Fiji REDD+ policy 2010
Mangrove Management Plan, 2013 National REDD+ forestry strategy, 2012
Land management
Native Lands Act and amendment, 1978 and 2002
Native Land Trust and amendments, 1985 and 1998, 2000, 2002.
Town and Country Planning Act, 1978
Crown Lands Act, 1978
Land conservation and Improvement Act, 1985
Land Development Act, 1985
Rivers and Stream Act, 1985
Land Use Decree and Regulations, 2010
Rural land use policy, 2006
National Action Plan to combat desertification/land degradation and to mitigate against drought, 2007
Integrated Coastal Management Framework (2011)
Health
Public Health Act, 2002 National Health Emergency and
Disaster Management Plan, 2012-2016
22
It is worth noting that the Government had been planning a Sustainable Development Bill as far back
as 1999, which was taken over by the coup d’etat in 2000. It was comprehensive in its policy reach.
In this Bill, the proposed National Council for Sustainable Development was to be tasked with
preparing the following policy statements:
Policy on Integrated Resource Management which must include:
o Sustainable coastal management;
o Sustainable mineral resources development;
o Forestry development
o Fisheries development
o National biodiversity, conservation and protected areas;
o Sustainable agricultural development;
o Sustainable resource management on native and State lands.
Policy on poverty, sustainable human settlements and achieving a sustainable population;
Policy on integrated waste management;
Policy on sustainable human and environmental health;
Policy on energy conservation;
Policy on training, education and investment.
For example, the MMP 2013 notes that mangrove management needs a policy that recognises the
ecosystem services provided by mangroves as well as their potential role to adaptation and as a
result the policy requires a more conservative approach to mangrove conversion.
Coordination on natural resources and ecosystems management Part of the implementation problem is the lack of coordination and harmonisation across sector
spending plans and the result is that the budget does not reflect policy priorities. As noted in many
strategies, Fiji has a highly fragmented system of government ministries working on common and
overlapping areas and with gaps in other areas that are critical for effective climate change
responses. For example, no one government department is responsible for the planning and
coordination of the watershed management (MoAFF, 2007), mangrove management, water resources
management, coastal management.11 Land management objectives in Fiji affects the portfolios of the
eight Ministries representing economic services in Fiji and local government12. Water resource
management spreads the interests of eight government entities. There is no environmental protection
agency in Fiji and the Department of Environment is nominated to provide policy and regulatory
functions but is poorly resourced to do so. Data and evidence to underpin planning efforts is sparse.
In addition, although some key strategies recognise the connections between environmental,
economic and social system linkages and how they affect vulnerability to climate change (Rural Land
use Policy, 2005; Forestry Policy, 2007; Action Plan on Desertification, 2010, Integrated Coastal
Management Plan, 2011; Mangrove Management Plan, 2013), political leadership on progressing the
many good recommendations in these plans is missing, which is hindered by the current structures in
government, limited funding around which to coordinate and limited human capacity.
The Fiji Green Growth Framework for Fiji and National Development Plan process entailed a
consultative process to develop national development plans. But integrated development planning
needs to go further, it requires a harmonisation of priorities and methods across government. An
example of where this matters is the Ministry of Agriculture (MoA) which has five operational divisions
including land resource planning and land and water resources. Millions of Fijian dollars have been
11 For example, the MMP85 recommended a review of mangrove management for fuel wood; a review of the Fishing Rights Compensation procedure, which is seen to provide perverse incentives for mangrove clearance11, but neither of these recommendation have been carried out in the 28 intervening years between MMP85 and MMP2013.. 12 Infrastructure and Transport; Ministry of Agriculture, Rural and Maritime Development; Local Government and Environment; Land Resources and Mineral Development; Fisheries and Forests; Sugar; iTaukei (indigenous affairs).
23
spent in dredging rivers13 that are receiving high amounts of soil washed down from the slopes14, but
the more cost-effective, preventative solution might be to invest in landscape conservation practices
to prevent soil erosion in the first place. The focus and budget in the MoA is focused on the
infrastructure solution, with land conservation receiving less than one percent of the MoA budget.
The lack of coordinated decision-making around public sector investments is reflected in the budget
preparation process which means that the budget does not support a consistent set of policy
objectives across ministries. A nation sets its priorities and projects its values through its budget,
through the policies and objectives that the budget supports (MoE, 2016). But the budget preparation
process in Fiji is carried on the basis of actual spent in the previous year less any one-off items (MoE,
2015). These budget bids are evaluated by the Budget Division of the MoE which provides a limited
form of integration of sector plans. Ministry leads have bilateral consultations with the strategic
planning officer in MoE when Key Performance Indicators (KPIs) are discussed. Duplication between
sector plans is identified and eliminated for example, if two ministries are planning on installing
boreholes. But this falls far short of an integrated strategic planning across sectors where objectives
are harmonised. There are no multi-year expenditure projections in the central agencies which is
indicative of a lack of forward planning towards resilience goals.
The availability of a financing source has been shown to have convening power to coordinate different
players. There are a few examples where coordination has been successful around a funding source.
REDD+ is proving successful in coordinating ministries because there is financing that pulls in the
interest from ministries with an interest in the area. Another example of good coordination experience
was reported to be the GEF-funded health and adaptation project implemented with support from
World Health Organisation. The coordinating body was disbanded because there is no more funding
to coordinate around. The implication is that the NCF could perform an important and much needed
sector coordination function.
Mainstreaming of climate change policy into sector plans and budget It is unclear the extent which climate change policy has been mainstreamed into sector plans and
budgets in Fiji though the indications are that the degree of integration has been weak. To illustrate
this point, Table 5 compares the adaptation options identified in the Fiji Second National
Communications Report to the UNFCCC to the Ministry of Agriculture 2015 corporate plan.
Table 5 Comparison of adaptation measures identified for Fiji and Ministry of Agriculture performance targets
Adaptation measures identified in 2nd National Communications (2013): agriculture sector
Ministry of Agriculture output indicators (2015 targets) – selected examples from Output 1: Maintaining food security in the non-sugar agriculture and livestock sectors
Agriculture Agricultural diversification;
Traditional multi-cropping;
Traditional planting methods e.g. vertiver grass for soil stabilisation;
Use of more tolerant and tested species and cultivars including flooding and salt water;
Use of legumes for soil enrichment;
Good drainage and irrigation systems in place;
Hydroponics;
Tree crops;
Agro-forestry including planting shade trees and live fencing;
Farm practices
# of land use and farm plans incorporating best farm practice and technology that are disseminated and adopted by farmers (26)
# of farmers diversifying to increase farm production (318).
Pest and disease control
Reduce prevalence of livestock disease (25 percent)
Reduce the prevalence of crop pests and diseases (18 percent)
# of new control measures and management programmes for pest and disease management developed and implemented (4)
Food security
Conservation of crop germplasm (35)
Provision of planting materials (35)
13 F$14 million or US$7 million was allocated in the 2016 budget. 14 A figure of 21 million tonnes of soil per annum washed away into four of the seven rivers in Fiji was reported in the Fiji Green Growth Framework for Fiji.
24
Research activities on resistant varieties and regular testing of soil samples;
Use of natural insecticides and animal medicine
Provision of vertiver grass and NFT planting materials (2)
Strengthen planning response to disasters
# of indigenous livestock and crops distributed to farmers (8)
Output 4: Sustainable management of natural resources through flood protection programmes and other sustainable land management practices
Sustainable land management
In addition to soil conservation measures listed above:
Foreshore protection;
River diversion;
Dredging;
Land use planning;
Integrated watershed management projects
Relocation of farms from coastal areas to inland areas with appropriate farming systems.
#number of SLM methods implemented by communities as a result of technology transfer and knowledge transfer (26);
# of land use plans and farm plans implemented and distributed to farmers (40);
#number of land identified for agricultural purpose and commodity fit (40);
Combatting land degradation (16);
#number of land cleared, prepared and utilised for agricultural purpose (26).
# of river dredging works (3);
# of river bank protection (2);
# of drainage schemes maintained (92);
# of rain fed areas improved (3).
Ministry performance targets on food security are line with many of the adaptation options identified in
the agricultural sector in Fiji. The question is then about how these output targets are delivered – are
they being implemented in ways that invest in resilience? For example, is the indicators on
prevalence of pests and diseases being achieved through means that minimise the impact to
ecosystem function? The additional costs of adaptation should be focused on the implementation
needs to ensure that resilience to climate change is delivered through the KPIs, e.g. training, skills
development, coordination, designing the interventions and monitoring results.
The second point to note is that there is a divergence in priority measures when it comes to
sustainable land management the between adaptation list of measures and the Ministry performance
targets. Some of the differences reflect gaps (e.g. River bank protection appears in the KPIs but not in
the adaptation list of measures) and some of the differences reflect departmental boundaries (for
example, foreshore development may be under Department of Lands). Also, in each of the two list of
adaptation priorities there are alternatives, e.g. in the adaptation measures list the choice between
watershed management and river dredging, or foreshore protection and relocation of communities. In
the Ministry list there are also competing or inconsistent indicators, e.g. the choice between hectares
of land cleared for agriculture and combatting land degradation, or dredging works and river bank
protection. In addition, some of the indicators are too vague to provide any assurance of
sustainability, e.g. number of land use plans or number of rain-fed areas improved.
An additional observation is that, whilst segmenting the Ministry’s portfolio into Outputs with distinct
responsibility areas or characteristics may be a pragmatic way of covering all relevant dimensions of
the Ministry’s mandate, unless there is a coordinated approach to planning with a culture that enables
open conversations and a training programme that promotes shared understandings of a problem, it
is very likely that fragmented planning and implementation will be the result, marked by inherent
contradictions and conflicts arising between different teams and work plans. These contradictions
can be seen in the choice of indicators within and between output areas in the Ministry’s performance
plan, as discussed above. Another way to look at it is in the budget. The budget for watershed
management in the Ministry’s budget allocated is F$498,300 while the amount dedicated to land
clearing is F$500,000 in 2016 (MoE, 2016c) which, at face value, could mean net resilience benefit of
zero without proper planning consideration of where land clearance takes place to preserve
ecosystem function. It is also worth noting that watershed management has a budget of less than one
percent of the total Ministry of Agriculture budget (F$76.2 million) indicating the disconnect between
the recommendations contained in the various land-based strategies and the way budgets have been
25
allocated (e.g. 2020 Agricultural Sector Policy, Rural Land Use Policy, Forest Policy Statement,
National Action Plan to combat Land Degradation and others with a call for improving watershed
management).
The conclusion reached is that i) integration of the adaptation message and approach needs to
happen within Ministry core business for efficiency and effectiveness; the Ministry’s performance
framework would be enabling of this (with revisions to the indicators as indicated above) and ii) the
adaptation process should be an inherently research-oriented endeavour in order to discover the
value for money proposition of these adaptation measures either individually (for example dredging)
or as a package (for example climate resilience farm practices), in order to inform future adaptation
plans, especially given the fact that baselines are continuously changing, climate change is an
dynamic risk interacting with many moving parts which makes CCA context specific.
The 2016 budget allocation reflects between 27 percent to 55 percent of capital budget allocation to
the Ministries of Fisheries and Forests, Lands and Resources and Agriculture for capital expenditures,
amounting to some US$27 million (MoE, 2016), indicating that resilience benefits could be extracted
from the existing government activities and budgets. There may be room for at least some of these
funds to spent more efficiently on measures that improve livelihoods and increase resilience to
climate change, for example, re-orientating the emphasis from river dredging schemes to sustainable
land management, or simply enforcing legislation on land-use zoning15 and for investments funded
through the NCF to be linked to these plans. Integrated planning can be useful in finding efficiency
improvements and therefore an important mechanism in helping the funding go further.
Table 6 compares the baseline problem narratives contained in natural-resource management
strategies in Fiji and the equivalent adaptation measures proposed in the Second National
Communication (GoF, 2014). One can see the extent to which these narratives reflect system
dynamics and the interaction of climate change with it. The comparison shows gaps between and
within each of the narratives, indicating the need to engage with these issues within the core planning
process of responsible ministries.
Table 6 Complementarity between baseline priorities in water, biodiversity and coastal zone and adaptation options
Sector Baseline priorities identified in national strategies relevant to resilience
Adaptation options identified in the UNFCCC 2NC
‘Systems’ gap in the two lists of priorities
Water Coordination between sectors;
Lack of human capacity;
Long-term sustainability of water services and schemes
Degraded water quality from untreated waste water, lack of solid waste management and sediment and chemicals washed down from the land;
Watershed management
Ground water protection.
Rainwater harvesting systems
Access to multiple water sources
Bottled water available in urban centres
Upgrade drainage systems
Increased water recycling;
Water pricing;
Water conservation
Pilot projects for IWRM
Water safety plans
Gap in dealing with water pollution from various sources including the need for watershed management. A unifying concept of IWRM is mission which recognises competing demands for water, allocation rules based on sustainable resource use and a sustainable financing framework for efficient and continued use.
15 For example, the 2011 Integrated Coastal Management Framework indicates that people build their
homes too close to the shore making them more vulnerable, again increasing sensitivity to the risk.
The 30m setback is not enforced.
26
Biodiversity Promote the sustainable management of indigenous forest including mangrove;
Enact regulations or codes of practice which ensure EIAs of new logging areas and plantation establishment sites;
Encourage and support community based natural forest restoration initiatives;
Encourage and help communal management units to establish or reinforce protected areas;
Establish the institutional and legislative framework for a core protected areas system for terrestrial and marine environments.
Nature reserves
Promotion of eco-tourism as a driver of biodiversity conservation;
Delineation of buffer and rehabilitation zones;
Relocation of endangered species;
The narrative in the 2NC approaches biodiversity as a protected areas issue; it does not recognise the pollution and degradation issues involved. i.e. system linkages are not appreciated. Likewise the solutions in the biodiversity action plan do not include recommendations regarding waste management and sedimentation from land clearance from agriculture.
Coastal zone Beach management and coastal erosion;
Wetland protection;
Non-point pollution;
Sea level rise;
Coastal and estuarine water quality;
Threatened and endangered species;
Coral reef management.
Solid waste management;
Sustainable fisheries management;
Foreshore and wetlands protection;
SLM along water ways for river bank protection;
Replanting and restoration of coastal vegetation;
relocation
The narrative in the 2NC does not recognise system linkages between land-based activities and the coastal zone. Adaptation options therefore focus on a limited problem area.
Integration of climate change into sector plans and working towards harmonisation between sector
plans requires effective coordination to ensure that shared investment proposals are developed which
will use scarce public resources efficiently and effectively. This requires good information and a
forward looking perspective, which is especially important given climate change, a dynamic risk.
The National Climate Change Adaptation Strategy (NCCAS) presents a series of recommended
activities in order to close the gap on the existing matrix of sectoral policies, strategies and action
plans, noted in Table 4. For example, Table 19 of the NCCAS (pg. 80) has suggested actions over a
three year timeframe to address these gaps such as revising the National Environment Strategy,
finalising the National Water and Sanitation policy, establishing a national Water and Sanitation code,
formulating a water resources management law, developing an agricultural and climate change policy,
reviewing the rural land use policy of 2006 to incorporate climate change adaptation (CCA) and DRR
and so on. The NCCAS also has a nine year action plan to strengthen institutional arrangements on
CCA and DRR (Table 20, pp 86) including activities such as a training programme, organisational
innovations such as establishing CCA/DRR focal points in each ministry, setting up a new working
group in the National Climate Change Team, reviewing the institutional responsibilities and linkages of
the Fiji Met Services and National Disaster Management Organisation (NDMO) and developing a
multi-stakeholder consultation process. Other similar tables contain actions on community awareness,
education and training, data collection and sharing. None of these actions have yet been costed.
To address the need for mainstreaming of the country’s national climate change policy into sector
plans and budgets, the 2012 National Climate Change Policy scoped out around 72 priority actions
across seven priority objectives such as ‘Mainstreaming;, and ‘Data Collection, Storage and Sharing’.
The action plan has not been implemented according to the mid-term review carried out of it. A review
of the NCCP is due to begin in 2017.
3.2.3 Local government planning The Ministry of Local Government is responsible for planning processes in the 12 municipal councils
in Fiji through Special Administrators. The Ministry of Rural Development and National Disaster
27
Management Office is responsible for planning processes in all other communities including the
Divisional Commissioners (there are four Divisions in Fiji), Provincial Administrators and District
Officers. . The Ministry of iTaukei (Indigenous Affairs) oversees the political representation process
through the iTaukei Affairs Board: Provincial Councils (14 in total), District councillors and village
council. The iTaukei Affairs Board has recruited eight Conservation Officers to work in five Provinces,
who, among things, were trained to conduct rapid vulnerability and adaptation assessments with
support and collaboration of the CCU, Conservation International and the University of South Pacific.
The Ministry of iTaukei Affairs also established, through its Board, Resource Committees in all
Provinces comprising resource owners, line ministries and NGOs for the purposes of resource
management.
No reviews could be found on how well these local planning systems work. The Ministry of Local
Government was reportedly preparing a policy on coordination and planning, though this was not
availed for the development of this report.
3.2.4 Coordination on climate change policy The intention is to centralise climate change coordination and project implementation, monitoring and
reporting functions at the whole of government level with the Strategic Planning Office at the Ministry
of Economy. This is to ensure that budget-funded programmes and projects are implemented in a
holistic and well-coordinated manner. The Strategic Planning Office will be responsible for
assessment and tracking of performance of all government ministries through the new National
Development Plan (MoE, 2016). The first step has been to move the CCU from the Ministry of
Foreign Affairs to Ministry of Economy. The move of the CC from the Ministry of Foreign Affairs to
MoE was considered a good thing by many stakeholders during the consultations in preparation of
this report because of the greater coordination and convening power it confers. The CCU is
responsible for delivering the NCCP working within government mechanisms and engaging with a
range of stakeholders, as well as coordinating projects and programmes to that effect. It also offers
the possibility, though by no means guaranteed, of boosting MoE capacity to deliver climate change
financing and results. The other main responsibility includes being the main liaison office for donors
and the lead in international negotiation strategies.
The 2016 budget allocates F$6.1 million (US$3 million) for capital projects and the hiring of 13 new
staff to the Climate Change Unit of the Strategic Planning Office. The current situation is that only one
staff member of the CCU out a team of six people is reported to be funded by the Government of Fiji,
the rest are funded by projects. The CCU has a small annual budget of around US$200,000 (MoE,
2015). With an overstretched budget, it is difficult to coordinate other ministries and to make progress
the many actions listed in the NCCP Implementation Plan.
Notwithstanding the need to strengthen coordination, leadership and monitoring functions for the
implementation of the NCCP, this does not obviate the need for government ministries to strengthen
their own planning and implementation process for climate-relevant investments funded from the
consolidated fund, as the discussion in the previous section argues.
3.2 Delivery effectiveness and challenges Delivery challenges prevents funds flowing freely to deliver intended results. No information on
delivery rates in different ministries could be obtained at the time of writing this report. Ministry of
Economy does not, for example, publish a year-end report to show delivery with the level of
expenditures authorised by the legislature. Procurement processes are a major barrier to effective
implementation (MoE, 2016). Capital projects are delayed, not because of lack of funds or
government will but because the ministries have lacked the experience and technical expertise to
carry out the ground work needed to take the projects from beginning to end (MoE, 2016).
The country is undergoing civil service reform to bring about a skilled, professional and accountable
civil service. A Civil Service Reform Management Unit (CSRMU) has been established with a budget
of around US$500,000 in 2016. Analytical work carried out under the CSMRU has led to transitional
phase to abolish the Public Service Commission and the establishment of a new Ministry of Civil
Service which will support Ministries to carry out their responsibilities while maintaining central
28
coordination of key areas to ensure consistency across the Civil Service. The other achievement is
the development of a Guideline for Ministries to fully implement open merit selection for all positions in
the Civil Service. A training budget will be give emphasis in the budget (MoE, 2016). Other
measures that are being addressed are e-government systems; improvements to the Government’s
financial management system; procurement processes and salary scale revision. No information
about this was available but the action plan for the establishment of the NCF could support some of
the recommendations.
3.2.1 Public Financial management The 2004 Financial Management Act (FMA) provides the legal authority for public financial
operations, procedures and controls in Fiji. It is supported by a set of financial regulations, instructions
and manuals. The PFM system is decentralised to ministries who maintain their own bank accounts
and make their own payments. Selected expenditures require approval from MoE. Reallocation of
funds within expenditure heads area allowed under certain conditions. Fiji runs a cash-based
accounting system.
The Financial Management Reform (FMR) programme, which re-started in 2001, is geared towards
enabling government to better implement its policies and deliver goods and services more effectively
and efficiently. The FMR has four key components i) financial legislation and FMR policies ii) the
development and implementation of the Financial Management Information System (FMIS) for
expenditure management iii) the introduction of performance budgeting and iv) change management.
The new Financial Management Act was its associated policies and regulations have been in place
since 2004. Financial authorities have been decentralised to Permanent Secretaries. The FMIS was
introduced into the Fiji public sector in 2005 and completed in October 2007 and FMIS training
support is provided on an on-going basis. Performance budgeting is gradually being introduced
across government with agencies reporting on the implementation results of one or two budget
funded programmes. At the time of writing it was not possible to see an overall assessment of how far
the programme had gone in achieving performance budgeting nor future plans in this area. A limited
number of Corporate Plans have been produced which contain outputs targets but better
understanding is needed on how these output targets deliver the RSSED goals relevant to climate
change and the Green Growth Framework for Fiji recommended actions. A full set of corporate plans
for a range of ministries for any given year could not be tracked down, far less annual reports.
Transparency and accountability which includes consistent and accessible performance reporting is
important for a potential NCF as funds put into the Fund would be expected to deliver intended results
reported in a transparent manner.
The 2012 PEFA assessment16 was not available for review in researching this report, but the 2015
CPEIR reports that one of the conclusions reached is that aggregate fiscal discipline was deemed to
be improving. The introduction of ministry expenditure ceilings and the strengthening of controls on
expenditure commitments has improved budget management. The low variation of expenditure
outturns compared to the budget (data from 2010 – 2012) indicates good management and control of
the budget17 though this conclusion is based on aggregate figures which do not tell us about
differences in delivery performance by ministries or department. The PEFA assessment also noted
that budget execution reports and annual financial statements are prepared in a timely fashion and
data quality is acceptable. The CPEIR reports that the 2012 PEFA assessment concludes that Fiji’s
PFM system is centred on a set of relatively advanced budget and financial management rules and
structures around a clear legislative framework and the rules are well documented. Compliance with
these rules and processes in many areas is high. An important weakness in accountability is the lack
of effective legislative oversight which hinders the ability of external stakeholders to hold government
to account for performance (MoE, 2015).
16 PEFA is a methodology for assessing public financial management performance. It identifies 94 characteristics (dimensions) across 31 key components of public financial management (indicators) in seven broad areas of activity (pillars). 17 The variation between expenditure and budget was between 2.7 and 3.1 percent variation between actual expenditures and estimated (with actual being lower) (MoE, 2015).
29
The narrative is somewhat different when looking at another set of reports. The National Audit report
2013 contained a range of audit queries across all ministries and Departments regarding the reliability
of financial statements, regularity of financial transactions, functioning of internal control and
procurement systems. These audit queries appear to indicate that accountability for funds using
national systems is not at sufficient level to provide an assurance that funds are being used as
intended. Systematic follow-up on audit recommendations has been lacking, though this may be
changing due the recent establishment of the Public Affairs Committee.
The Public Accounts Committee is a new Parliamentary institution, which met for the first time in
2015. The PAC recently reviewed the audit reports 2007 – 2009. It highlighted systemic governance
issues, many of which are being addressed by MoE but some of which remained concerning in 2015.
Issues included the lack of the compliance of all accounts with FMIS, submission of an annual report;
reconciling cash transactions, having control systems in place for cash transactions. Staff across
agencies raised the issues that they simply did not have the human capital to do the most basic of
accounting and reporting tasks. It noted that the MoE, with the International Monetary Fund and the
World Bank, have gone through a process of integrity testing of the entire budget cycle and are now in
the process of finalising the reform plan for future accountability. 29 recommendations were made by
the PAC to the GoF including the following which are relevant to establishment of an NCF and which
could be taken up by Action Plan:
Recommendation 5: The office of the Auditor General to consider a performance audit of the
skills and education of finance officers within each agency and to provide recommendations
where further support or training is needed.
Recommendation 11: the MoE to appoint a project team to resolve or minimise all of the 29
systemic governance issues raised by the AG reports of 2007-2009. The project team is to
initially review all timelines and timetables of relevance to each issue to see if a smarter way
of accounting and reporting can help staff resolve the issues;
Recommendation 17: Establish a centralised database of all staffing workloads in all agencies
that is updated as close to real time as is feasible. This should include full time, part-time,
casual and temporary staff.
Recommendation 20: Develop new control system that make payments on projects based on
the actual delivery of the project.
Recommendation 21: all accounts must be covered by FMIS by year end 2015.
Recommendation 22: all agencies must submit annual reports in a timely manner.
Recommendation 23: All agencies must deliver reconciled reports that align with actual cash
in bank.
Recommendation 24: all agencies should immediately audit their ability to deliver an annual
report, participate in all FMIS and MoE requirements and to have internal controls to ensure
that actual and reported statements are accurate.
The recommendations in the Financial Management Improvement Plan are being prepared as part of
the EC budget support programme, but at the time of writing this was not publically available.
Accreditation to the international climate funds (Adaptation Fund and the GCF) requires certain
standards in budgetary and project management capacities. Table 7 shows examples of indicators in
four areas of public financial management and their read-across from the standards expected of the
MoE and the standards expected for National Implementing Entities (NIEs). For some countries with
fairly developed public financial management systems, such as Fiji, the effort put into strengthening
financial management and planning capacities in an NIE represents a missed opportunity to apply the
effort to the main national planning and budgeting process.
Table 7 Correlation between Public Financial Management Performance and NIE accreditation requirements
Public Financial Management Performance indicators
NIE accreditation requirements
Financial integrity and management
30
Multi-year perspective in fiscal planning, expenditure policy and budgeting; Effectiveness of internal controls for non-salary expenditure
Produce financial plans and budgets; Manage and disburse funds efficiently and with safeguards
Institutional capacity
Competition, value for money and controls in procurement; Quality and timeliness of in-year budget reports
Procurement procedures which provide for transparent practices; Capacity to undertaken monitoring and evaluation
Project/programme management capacity
Orderliness and participation in the annual budget process Timeliness and regularity of accounts reconciliation
Ability to identify, develop and appraise projects; Competency to manage or oversee the execution of projects including supporting delivery and implementation.
Transparency and self-investigative powers
Scope, nature and follow-up of external audit; Comprehensiveness of information included in budget documentation
Competency to deal with financial mismanagement and other forms of malpractice.
Source: MoE, 2015
3.2.2 Performance management Clear procedures for monitoring and evaluation (M&E) and reporting are needed to provide
accountability of funds entrusted to the NCF. Consistent reporting is essential for transparency. KPIs
are a feature of government planning processes in Fiji established in the FMA and have the potential
to be an important integrative mechanism between the work of the Ministries and the national
development goals. Each Ministry undertakes to deliver a set of output and outcome targets and
progress against the indicators are reported in a word template and sent to MoE. Currently KPIs are
linked to the RSSED but the goals are likely to evolve once the National Development Plan is
published later in 2016. Ministries are expected to produce annual corporate plans and annual
reports, though many were not available at the time of writing this report. Because climate change is
a dynamic risk and the interactions with the baseline environment cannot be completely understood
nor predicted, adaptive management in policy and programme implementation is needed. A learning
culture needs to be fostered in order to design better policies and programmes. The ability of GoF to
learn from policy implementation is currently lacking. There appear to be limited knowledge
management and sharing systems in place.
Looking at the GCF monitoring framework for adaptation and GHG emissions mitigation, it becomes
obvious that the indicators which are most difficult to track are the adaptation indicators because of
the difficulty in defining and measuring resilience in outcome and capacity terms. For example, the
following indicators have been selected from the GCF performance framework for adaptation:
• Degree to which the funding contributes to climate resilient sustainable development
(qualitative/scorecard approach, includes the degree to which knowledge and learning are
achieved; the degree to which an enabling environment is created);
• Extent to which people in the affected area are made more resilient to climate-related hazards
(an index of composite indictors e.g. access to services, reduced risk of losses, enhanced
productivity)
• Number of physical assets built or modified to increase resilience to climate change
• Extent of ecosystem services generated or protected in response to climate change
• Number of climate information tools and services used for decision-making
A difficulty with some of these indicators is the cross-sectoral dependencies in delivering results such
as these, meaning that no one department or ministries may be entirely responsible for delivering on
performance targets such as these. This requires joint working among departments to deliver
indicators and targets such as these. For example, on the first bulleted results area, sustainable
development is a broad term that depends on evidence and sharing of data, information and learning
31
from a range of ministries. The second bulleted results area is a composite index of information that
may be gathered by more than one department or ministry.
Baseline Information Results tracking requires good baseline information to compare against. Fiji requires a
comprehensive data collection in areas of surface water (streamflow), groundwater and water quality
monitoring matched with information on national water use, extraction and replenishing rates for water
resources. Information is important for integrated water resources management because the system
dynamics need to be better understood, i.e. the availability, behaviour, impacts and qualities of water
and how they interact with human activity. Flow in surface water is subject to not only climatic factors
but geology, vegetation and the impacts of development. Groundwater (GW) quantities and
behaviour should be understood. Public Works Department has the largest streamflow data where
urban water schemes exist, MoA some data on zone of tidal influence: irrigation and flooding.
Together their databases could provide a comprehensive foundation for streamflow on the larger
islands. Mineral Resources Department has data on GW quantities. Water quality data is more
scattered. Waste water discharge permits of DoE requires data on discharges to be collected
routinely. In addition the Ministry of Health collects data on drinking water contamination which may
include samples of water sources and academic institutions collect data on water resources. Data
collected, shared and integrated analysis carried out over time is necessary to show trends in problem
development, as the basis for identifying the appropriate solutions.
The risks posed by climate change to human health are not well understood by either the public or the
wider community of researchers. There are limited human and institutional capacities to collect and
manage health data in Fiji. Health data must be integrated with environmental and socio-economic
datasets to develop decision support tools for effective health adaptation. Surveillance activities are
still in large part fragmented and there is insufficient coordination among the various established
systems, as well as low capacity to interpret integrated data, and an inability of these systems to
provide timely data for immediate decision-making in Fiji. There is a need to strengthen integrated
environment and health surveillance systems e.g. disease surveillance systems on vector borne,
food, borne and water borne diseases are not linked to monitoring data on the carriers of disease:
vector surveillance, food safety and water quality (WHO, 2015).
There is hardly any planned forest management in natural forests. Management plans are non-
existent and the harvesting plans that are submitted by licensees are rarely based on sound resource
inventories. Estimates of the area of mangroves in Fiji is uncertain still. For management purposes,
Department of Lands needs to have access to a reliable and readily updatable capability for
assessing mangrove area and conversion. Neither Department of Lands nor Department of Forests
have monitoring capacity for mangrove management.
The data needs for forest management have been set out as follows in the 2011 Integrated Coastal
Management Framework of the Republic of Fiji:
Resource inventories and environmental profiles;
Mapping and GIS systems;
Remote Sensing;
Environmental Impacts Assessments;
Rapid appraisal techniques;
Benefit-cost studies;
Risk assessment;
Valuation of resources;
Habitat assessment techniques.
The need for data and information for sound coastal management decision-making include:
Areas of coastal erosion;
Changes taking place in mangrove areas;
Limits of acceptable change in major current and planned tourist areas;
32
Marine invasive species;
Coral reef health;
Wetland circulation, soil and vegetation types;
Appropriate and effective pollution control measures for Fiji;
Marine-based pollution from vessels.
There are pressures on land which make it urgent to increase sustainable production per unit area,
but there is a poor understanding throughout the agricultural sector about a closer matching between
land use/crop type and land capability if productivity goals are to be met. There is a critical need for
an information system for land degradation. There have been previous scientific activities and
initiatives such as the soil surveys and soil correlation (i.e. classification of soils for the purposes of
agro-technology transfer and matching of fertiliser applications), but these efforts were not financially
sustainable (MoAFF, 2007). Land resources information such as geology, soils, land use capability
classification, climate vegetation, topography, water resources and the land tenure has been and may
still be available.
GoF is introducing a vulnerability self-assessment tool. Local communities are engaged in selected
areas to identify areas of vulnerability. CCU collects and maps the results. CCU has identified 600
communities to be under climate threat. Also a method to evaluate climate resilience at the
community level, though a set of indicators (WRI, 2015). This type of information is complementary to
the bio-physical data that should be collected to measure environmental system dynamics, set out in
Section 4.
The Green Growth Framework for Fiji recognises that it is not possible to manage what is not
measured and that is necessary for the government to strength the gathering and analysis of data to
support decision-making at the strategic planning level. It also acknowledges that damage to the
environment has been caused through data gaps in incomplete project appraisals. It posits that a
broader set of goals and indicators are necessary to track progress towards green growth, which
requires data gathering and monitoring capacity, storage and information sharing system and
mechanisms.
The 2016 budget allocated F$6.2 million (US$3.1 million), an increase of F$1.4 million, to hire 17
additional staff to strengthen the Fiji Bureau of Statistics analytical capacity to meet the increasing
demands for detailed, clear and accurate statistics and the development of new economic indicators.
This is additional to the funds allocated to the Strategic Planning Office (Climate change unit) for
hiring of new staff (see previous section).
3.2.3 Human capacity The lack of adequate capacity in the ministries and Departments in terms of the number of staff to
implement climate change and disaster risk management and the technical and project management
skills required for staff to be successful are the most binding handicap to the achievement of the
national goal (MoE, 2015). Retention of specialised skills is a particular difficulty.
Human capacity is critically important to achieving climate resilience. The various strategies in play
have good recommendations which are not implemented. Knowledge, skills, leadership and technical
skills are all constraining factors. For example, the 2020 Agricultural Sector Policy recommends agro-
forestry in upland areas, to be carried out with specific methods that are environmentally sustainable
(e.g. contour planting with specific species) but the human capacities need to be available to
implement this strategy correctly. Expertise in the areas of agricultural extension, soil conservation
and land use and environmental planning management and enforcement is below critical mass for the
responsible line ministries. The resources devoted to soil conservation are inadequate for the
implementation of significant measures either in terms of providing information or incentives. Fiji
Sugar Corporation has no staff designated as soil conservation officers and the institutional memory
of land husbandry practices is poor due to the current age structure requiring succession planning. As
a comparison, prior to Fiji’s independence, the Ministry of Agriculture, Fisheries and Forestry had
some 60 conservation officers between them (MoAFF, 2007). Similarly, it was reported that there was
only one qualified geologist with experience on GW in Fiji and in the region in 2007 (SOPAC, 2007),
33
yet expertise is needed in hydrogeology, hydrologic modelling, environmental modelling and
assessment of ecosystems, estuarine and coastal zone modelling and assessment.
Ministries are given training budgets but they are small. For example, Department of Environment
has a training budget of F$10,000 (US$5000) per annum for a Department comprising 46 staff
members working across six Units.
4.2.4 Environmental and social safeguards EIA is a legal provision is contained in the 2005 EMA. It requires the EIA unit in the DoE to examine
and process every development proposal that is referred to by an approving authority and that may
have significant environmental or resource management impact. The EMA is supported by the 2007
EIA regulations and EIA guidelines published in 2008. Though the regulations and the guidelines
appear to be a good basis for environmental management, the weakness is that there is no
mandatory legal requirement for EIA in specified circumstances in the EMA. The specified
circumstances are contained in the guidelines which may or not be followed. Whether following the
EIA makes any difference to project design to ameliorate risks and maximise benefits needs further
investigation. On its own EIAs are not sufficient to prevent environmental degradation, there also
needs to be adequate levels of monitoring and enforcement, which is shown to be absent in the
strategies and plans reviewed for this report. Compliance with the letter and spirit of the regulations is
essential for the practical benefits to be derived from this legislation. There is documentary evidence
to show that EIA recommendations are ignored, and that environmental impacts are disregarded in
the pursuit of financial returns18. Training and awareness raisin is required at all levels to bring about
willing compliance with these legal requirements.
4. Financing strategy for the NCF
To achieve the global temperature goal of no more than 2oC average global warming, the
International Energy Agency (IEA) forecasts that incremental investment in the energy sector alone
will need to reach US$36 trillion over the period 2012-2050 or approximately US$1 trillion per year. A
2009 UNFCCC study of annual adaptation costs from 2005 to 2030 for five sectors estimated the
costs of adaptation between US$200- 210 billion. The World Bank estimated the costs of adaptation
to a 2oC world to be between US$85-121 billion per year now between now and 2050. This all means
that public finance alone cannot pay for the transition to a low carbon resilient future. Well targeted
public capital can be used to unlock private investment and can make investments go further. Given
the scale of the financing needs to respond to climate change, potential sources of financing should
comprise domestic tax revenues, private investment, development cooperation from bilateral
government agencies and multilateral institutions and a combination of public-private partnerships.
The goal agreed in the Copenhagen Accord at the UNFCCC Conference of Parties in 2009 was to
mobilise US$100 billion per annum by 2020 for adaptation and mitigation needs of developing
countries from a wide variety of sources including public and private, bilateral and multilateral,
including alternative sources of finance (UNFCCC, 2010).
To understand the sources of potential capital for the Fiji NCF, it helps to look at the global financing
picture for climate change. The private sector contributed the majority of renewable energy finance
globally: US$243 billion while public climate funds accounted for US$148 billion in renewable energy.
Most investment is through direct equity investment as shares and loans. Multilateral DFIs provided
84 percent of their commitment (US$40 billion) as market-rate loans or blended products with
domestic resources or money raised on the capital market. Earnings can be reinvested and
additional funds can be mobilised through co-finance (from commercial banks, development partners
or other international financial institutions), allowing DFIs to support investments that are much
greater than public funds alone can provide. They also supported risk management instruments
18 For example, spoil disposal from dredging in the Labasa and Rewa deltas is causing increasingly more damage to mangroves, but the Environmental Guidelines for Dredging are reportedly not used by either the DoE or LWRM (MMP, 2013).
34
(credit guarantees, political risk insurance and contingency recovery grants) with US$1.5 billion; these
play a significant role in enabling private investments in a context of political uncertainty or in
challenging investment environments. Developing countries are playing a growing role in scaling up
green investment. Investment flows have grown at a rate of 47 percent per year compared to 27
percent growth rate in flows from OECD countries. This data does not capture private sector
investments in energy efficiency (estimated at US$90-365 billion annually); land use (forestry)
investments (estimated to be US$4.2 billion annually) or adaptation investments. An estimate of the
size of the green bonds market has been put at US$65.9 billion in 2015 going largely to transport
followed by energy, buildings, water, waste and pollution and agriculture and forestry (Climate Bonds
Initiative, 2015). Less than 10 percent of private finance globally was mobilised for adaptation.
(Buchner et al, 2015). Box 2 explains the different types of private investments and relative
importance globally.
Adaptation was mostly financed from public sources; this reached US$25 billion in 2014, but data is
uncertain because different accounting approaches are used for tracking finance. About half of the
financing is in the form of low cost loans and a further 10 percent in the form of grants. The data does
not capture domestic public budget for climate related development which could reach at least US$60
billion per annum, ranging from between 0-15 percent of national budgets.
Consideration of how private sector finance should be woven into a financing strategy for adaptation
and GHG emissions mitigation should be a key part of designing an NCF, e.g. Should measures be
financed through direct government support (considering also the mix between domestic and
international), direct private investment (equity investment), indirect private investment (investment in
bonds); and how much should be invested in the enabling environment: regulation, economic
incentives and the general business climate. The financial strategy will affect the cost to the tax payer
and reflect the role of government in the national climate change strategy.
Private actors and their investment profile can be categorised as follows:
Project developers: accounting for $92 billion (38 percent) of private sector flows to renewable
energy globally: around half of the financing flowed to inshore wind projects and originated from
and was invested in East Asia and Pacific region (46 percent) followed by Western Europe and the
Americas. Around a third of project developers’ investment flows was government investments in
China (Buchner et al, 2012). Other project developer flows are from venture capital, private equity
and infrastructure funds, and corporate actors.
Corporate actors (non-energy investors): $58 billion (24 percent) flowing to solar PV globally.
Commercial financial institutions (providers of debt capital): 46 billion or 19 percent: mostly for
solar PV and onshore wind in East Asia and Pacific and the Americas. Development Finance
Institutions (DFIs) have increasingly involved commercial local banks in on-lending or co-financing
energy efficiency, renewable energy and climate resilient projects. Commercial banks’ engagement
in climate action is critical given their important intermediary role in originating investments and
lending to corporates and households for small scale projects.
Households (family level economic units, high net worth individuals and their intermediaries): 43
billion or 18 percent: mostly into solar PV and thermal systems. Most of these investments took
place in China, Japan and the US, driven by policy support schemes and declines in installation
costs.
Private equity, venture capital, infrastructure funds, Institutional investors, pension funds,
foundations, and endowments: 2.6 billion. Active on both the debt and equity side.
Source: Buchner et al, 2012 & Bucher et al, 2015
Box 2 The private sector investment picture for climate change
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Not everything can or should be financed by tax revenues. Many commercial enterprises which seek
to adopt technologies for adaptation or low carbon emissions would also benefit from lower bills and
or increased productivity so there is a strong argument for these private benefits should be financed
privately. Where the upfront costs are high, there is a role for government to facilitate loan facilities
(working with the private sector) because of the desirability of these investments from the social
perspective. For public goods, which benefit everyone and for which it would be difficult to exclude
anyone from deriving benefits (so-called non-rival and non-excludable goods), there is a strong
economic argument for public funds to be used to finance the measures (for example investments in
natural or infrastructural coastal protection). For poor, vulnerable communities with limited means for
adaptation, there is a role for government to facilitate access to adaptation measures, for example in
working with farmers on adaptive technologies, to get them to a level where they can adopt the
technologies as part of their own livelihood strategies. And for resource efficiency, there is a strong
role for government regulation in promoting behavioural change. Thus the role for government (and
the strategy for interacting with the private sector), and the budget required for climate change
responses, is graduated and strategic. Leveraging ratios can be high. Public-private finance
mobilisation and leverage ratios can be reached of 1:5 to 1:8 (World Economic Forum, 2013).
Table 8 provides a conceptual framework for considering how adaptation and GHG emissions
mitigation can be financed, which is important to consider given the scarcity of tax revenues. The left
hand columns indicate measures which yield private benefits, the right hand column indicates
measures which are public goods (non-rival and non-excludable) and therefore benefit the population
at large.
Table 8 Categories of measures to manage climate change and the financing framework
Beneficiaries of climate change investments
Providers of climate change investments
Private Public
Private Example
Mitigation: renewable energy and efficiency technologies
Adaptation: cooling systems for households or private business
Finance: private
Examples
Mitigation and adaptation: sustainable land management Finance: public sector subsidy or
100 percent grant to reflect social benefits from the measures e.g. payment for ecosystem management services which will avert or reduce the costs of flooding.
Public Example
Mitigation: renewable energy and energy efficiency
Adaptation: re-location; ‘building back better’ housing
Finance: public sector subsidy or
100 percent grant to reflect social benefits from the measures e.g. greenhouse gas emissions reduction or lower costs to economic growth from disasters
Example
Mitigation and adaptation: mangrove replanting for coastal protection Finance: public
Source: Adapted from Tompkins and Eakin (2012)
A clear example in Fiji of adaptation measures that deliver private and public benefits is in the area of
sustainable land management. The actions of many hundreds of small scale farmers can lead to good
stewardship of the land or degradation of the land resource, with knock-on effects on ecosystem
function and increased vulnerability to extreme events. The public sector response would be a mix of
training, awareness raising, financial assistance with developing and trying out new technologies and
practices and changes to the regulatory and/or economic framework to promote progressive
practices, for example, lengthening land leases to create a more secure property right over the land in
question in order to encourage investment in soils, or a payment for ecosystem system where
36
downstream users pay upstream users to manage the land sustainably. For any of these measures,
public funds will be needed to cover at least some of the cost of moving the farming community in
aggregate to more sustainable land practices.
The NCF financing strategy should hinge on this distinction: measures that deliver private benefits
should be funded by private funds; measures that deliver public benefits should be financed by public
funds; and measures that deliver private and public sector benefits should be financed by a mix of
private and public finance. The question for a potential NCF is how should it be positioned regarding
this framework: what and how should it finance projects that advance climate change objectives?
Public resources are limited in all countries across the globe, and, as explained above, private finance
needs to at the core of green growth transition. The NCF could essentially use private sector finance
models (blended with public funds where appropriate) to target investments in the left hand column
(Private beneficiaries) of Table 8. The NCF in Fiji could most easily attract investor finance through
money markets (i.e. bonds issuance) which could then be invested into clean energy and other
enterprises relevant to climate change,19 the most obvious being renewable energy provision but
there are others such as biofuel production, the creation of energy service companies to promote the
uptake of energy efficiency applications, or intelligent building design and construction, see Figure 2
for an indication of possible private sector investments relevant to advancing climate change. Low-
carbon investment initiatives of this nature could be aggregated into larger scale opportunities for
investment. Box 3 provides information on the Climate Bonds Initiative, for which the GoF could
explore partnership possibilities. Five of the world’s largest insurers called for governments to create
more climate-themed bonds so they can invest in such a market (Inderst et al, 2012). Private sector
investors could be international or domestic players. International debt finance could be attracted
from development finance institutions (i.e. concessional finance) or institutional investors. DFIs could
provide risk guarantees for green bonds issuance. Philanthropic funds have begun to plan an
increase role in recent years (Blader et al, 2014).
The NCF could also act as a broker for attracting equity investment into larger initiatives such as
renewable energy installations, though hurdle rates for renewable energy investments are often
higher than for traditional corporate investments (Kaminker et al, 2013) which could disadvantage this
strategy. Improving the regulatory and business investment climate is critical is order to provide high
risk- adjusted financial performance.
At the delivery end, public sector funds could be blended with business or household level private
investment to promote uptake of mitigation and adaptation technologies among lower income
households, See Box 4 for an example of a blended financing model designed in Uganda.
For public good investments indicated by the right hand columns of Table 8 (public beneficiaries),
public sector agencies may be attracted to a mechanism that delivers climate change objectives
efficiently and effectively through country systems. Budget support is a mechanism which has been
supported previously by donors and which is being initiated in Fiji by the European Commission (EC).
with an envelope of Euros 23 million for rural development, with the first tranche released already.
This indicates that country systems are deemed to be strong enough to account for funding given in
this way. Other donors also indicated a preference for budget support mechanisms eventually should
country systems prove to be robust enough to provide effective and accountable use of the funds.
Though the EC cannot put funds into a Trust Fund20, it is conceivable that the EC could direct funds in
a hypothecated manner to ministries for climate change resilience. The EC has committed 20
19 Fiji finances its budget deficit mainly through borrowing from the local capital markets by the flotation of medium and long term bonds and Treasury Bills, and has therefore long experience in attracting financing using this instrument. Fiji also borrows from offshore to finance its deficit. Fiji is the only Pacific country to have accessed the global capital market through two bond placements, which were well subscribed by international investors. Fiji has established a sinking fund for the repayment of these international bonds (MoE, 2015). 20 EU officer pers. Comm.
37
percent of its development budget to climate resilient development, signalling organisational mandate
to deliver on climate change objectives.
Accessing international funds for climate change is not easy, quick or particularly efficient.
International climate change funds are designed as project-based mechanisms with fiduciary and
performance oversight and accountability ultimately to the International funding source. The Fiji
Development Bank (FDB) is going through the process of accreditation with the GCF for up to a value
of US$10 million. The accreditation process began with the Adaptation Fund and took two years
before it was switched to the GCF where is has been on-going for just over a year, see Table 9 for
details. It is therefore arguable as to whether the international climate funds, as currently
implemented, are sources of easily accessible funding for climate change responses.
Table 9 Critical timeline of events for NIE accreditation in Fiji
Year Critical Events Discussions
2013 Commence work with Adaptation Fund (AF)
accreditation
- Received advice/suggestion from government on the opportunities with AF
- Work started but lack of direction/structure/support greatly hindered FDB’s progress
- Lack of clear guidance from AF and the understanding on what the process really involves
- “Fly-in” assistance from AF and partners was not value adding
- High turnover of staffs hindered work - Lack of awareness on ‘readiness’ assistance that was available as
FDB had to use own resources - Lack of ‘experience’ in dealing with adaptation projects (grants)
also contributed to the challenges
2015 Focused of accreditation work
changed to the Green Climate Fund (GCF)
- Change of focus driven by the need for strategic alignment to the broader government policies concerning climate change.
- The Ministry of Foreign Affairs nominated FDB as the NIE to the GCF in September 2015
- Change also driven by the replenishment concern of the AF
- Received assistance from the German Government for the ‘readiness’ program
- Realignment of proposed activities to mitigation (loans) and also explore the possibility of offering blended modalities to cater for adaptation projects i.e. FDB to capitalize on what it does best which is lending.
- Apart from capacity, main challenges also involve the development of required GCF policies such as gender, procurement, environment etc.
- Plans underway to setup a specialized unit within FDB to specifically focused on GCF issues
2016 Aims to be achieve accreditation by year
end
- Consultant now based with FDB for a limited timeframe to help them identified the required information
- Stage 1 of the accreditation is expected to be completed in September
- Submission of application to the GCF Board by end of this year
Source: Mr Jale Samuwai
38
Box 3 The Climate Bonds Initiative
The Climate Bonds Initiative is a non-for-profit organisation working on mobilising US$100 trillion
bond market for climate solutions. Climate bonds are infrastructure bonds tailored specifically for
financing climate solutions. Climate bonds, tied to specific climate change mitigation or adaptation
investments, allow governments to raise capital, or support the private sector in raising capital to:
Build renewable energy generation and its enabling infrastructure.
Widely implement energy efficiency measures in cities and industries.
Support adaptation measures that will boost the economic development of communities in the face of climate change.
Climate finance bonds can be categorised as ‘labelled green bonds’ and ‘un-labelled green bonds’
which in total represented US$597.7 billion of investment in 2015, an increase of US$95 billion on
2014. 32 percent of the increase came from the labelled green bond market. Un-labelled climate-
aligned bonds financing rail in China, India, France, South Korea and the UK contributed another
40 percent of the increase. Climate aligned bonds are investment grade, and denominated in 37
different currencies. Among commercial lenders, Credit Agricole was an early issuer of green
bonds responding to demand from the Japanese private placement market. Other banks issuing
green bonds are Bank of America, DNB (Norwegian Bank), National Australian Bank, Yes Bank
(India) and ANZ (Australia and New Zealand Banking Group), which are using proceeds to finance
a mix of renewable energy and energy efficient buildings. From the DFIs, the largest issuer of
green bonds is the European Investment Bank and the World Bank followed by the KfW (German
Development Bank), Asian Development Bank and Development Bank of Japan. The corporate
green bonds market is smaller and includes EDF (French Energy Company) among its issuers.
Investor demand in labelled green bonds in strong as indicated by oversubscription to recent green bond issuances. Investors have pledged to invest in a set amount of green bonds, e.g. Zurich Insurance, Deutsche Bank Treasury, KfW, Barclays Treasury among others. Numerous investor statements supporting the green bond market have been published. Because Climate Bonds are novel, government contingency guarantees or political risk insurance is deemed to be essential.
The Climate Bonds Initiative is developing policy proposals for all three sectors, including:
How to boost bank lending to renewables by adapting the $3 trillion covered bonds market to create renewable energy covered bonds.
Delivering on the promise of large-scale energy efficiency (e.g. getting to 85 percent of housing stock within 10 years).
Policy risk insurance for renewable energy bonds, to be provided by a consortium of governments.
The Climate Bonds Standard and Certification Scheme is a FairTrade-like labelling scheme for
bonds. It is designed as an easy-to-use tool for investors and governments that assists them in
prioritising investments that truly contribute to addressing climate change. Standards have been
developed for solar, wind and low carbon transport: rapid bus transit systems and low carbon
buildings. Climate bonds standard for bioenergy, geothermal, water from water utilities, low
carbon transport: rail, metros and hybrids and agriculture, land use and forestry are under
development and due for release soon.
Source: Climate Bonds Initiative 2015
Reference: Climate Bonds Initiative, 2015 report.
39
Figure 2 Universe of private sector climate change investments
Source: Adapted from Inderst et al, 2012
The Ministry of Economy could put domestic funds into the NCF to signal commitment and encourage
investment by development partners. For example, the newly established Environmental tax of 6
percent on services generates F$8 million per year (MoE, 2016b) equivalent to US$4 million per year.
Just taking 50 percent of this would provide US$2 million per year which could provide a valuable,
recurrent stream of funding to the Fund. The environment tax allocation to catalytic resilience building
would be a forward looking development investment, compared to the 2016 budget of F$3.8 million
allocated to disaster management, which is dedicated to cleaning up the effects of disasters.
Government funding of adaptation and GHG sinks is already demonstrated through budget
allocations towards REDD+ (F$100,000) and rain water harvesting (F$1.4 million) in 2016 (MoE,
2016). Domestic funding would have a good chance of leveraging capital from development partners.
These funds could go further if the funds were leveraged against Ministry budgets and a coordinated
policy process were initiated to determine how their spending plans contribute or detract from
resilience to climate change and the changes needed. Establishing an endowment fund would
provide a sustained baseload of financing. The NCF should establish targets on the capitalization to
signal that the GoF is serious about it; for example F$10 million in year 1, rising to F$50 million in year
5 and F$100 million in year 10.
Carbon revenues from offsets from the investments could be another source of finance. Observed
carbon prices span a wider range from less than US$1 per tonne of CO2e to US$137 per tonne of
CO2e. But most trades have been at a price lower than US$10 per tonne (Carbon Pricing Watch
2016). A new emissions trading scheme is starting up in China in 2017 and from October 2016 the
International Aviation Organisation is expected to decide on a carbon offsetting scheme starting in
40
2021. In addition results-based finance initiatives where emission offset investments are financed for
the purpose of reducing emissions rather than as a compliance mechanisms are gaining prominence.
The UNFCCC Secretariat estimates that the annual demand from results-based financing initiatives
could amount to 30 million certified emissions reductions. These initiatives include the Norwegian
Carbon Procurement Facility, the World Bank’s Pilot Auction Facility for Methane and climate change
mitigation, Carbon Partnership Facility, the Carbon Initiative for Development and the Transformative
Carbon Asset Facility. All these developments and many others of a similar nature could be sources
of demand for international carbon offsets. On April 22 2016 the United Nations Global Compact
called for a minimum internal carbon price level of US$100 per tonne of CO2e by 2020 in order to be
consistent with a 1.5 to 2oC pathway. This could mean US$75 million per annum for Fiji based on the
possible GHG emissions savings indicated in the country’s Intended Nationally Determined
Contributions (See Section 4.2.2 for details).
Box 4 Public funds unlock private finance: a cast study of adaptation in Uganda
4.1 The importance of the enabling environment Strengthening the wider enabling environment will be important to promote the development of a
project pipeline to the NCF, as well as attract private sector partnerships and finance to larger climate-
relevant investments, for example, independent power producers in renewable energy are attracted
by feed in tariffs for renewable energy. An enabling environment would also be important to promote
behavioural change and investments in technologies to combat climate change among the thousands
of households in Fiji, for example, removing perverse incentives to mangrove removal, removal of
incentives for land clearance for agriculture that involves heavy mining of soils or creation of
incentives for purchase of energy efficient equipment.
The Green Growth Framework for Fiji recognises that a major challenge to sustainably growing the
economy has been low levels of private investment which is affected by the business environment.
For example, the limited private investment in Fiji’s power sector to date is largely due to the following
i) lack of clear regulatory framework for encouraging third party electricity generation ii) resource
information not being made public iii) weakness in Fiji’s business climate. These constraints will need
to be addressed in order to full the renewable energy potential in Fiji and support future investments.
Northern Uganda: transforming the economy through climate smart agribusiness
This is an example of public funding stimulating private finance, venture financing and novel financial
instruments. It is expected that £44 million will leverage £39-79 million in private investment. In 2014,
DFID initiated the Northern Uganda – Transforming the Economy through Climate Smart Agribusiness
(NU-TEC) initiative which aims to support Northern Uganda’s transition from a region that has low
levels of development and is highly vulnerable to climate, to a wealth creating economy with higher
climate resilience through agribusinesses, crop diversification, replacing rain fed agriculture with
irrigation and development non-farm income sources. In 2014 DFID committed a total of £48 million
over the period 2014-2022. This includes:
£15 million is for TA to support the development of a climate-smart market and business model
for SMEs. These companies can then use their own balance sheet to investment in new
business opportunities.
£12 million is long-term capital provided through AgDevCo, a non-profit venture capital org that
provides early stage capital in the form of debt and equity to commercial opportunities in the
agricultural sector. AgDevCo works as a project developer and mitigates many front-end risks
that deter private investment.;
£10 million is for short and medium term capital to expand the financial sector’s range of
agribusiness financial services to the project target group. Borrowers may include traders,
cooperatives and farms. Private sector investors may also co-invest, providing leveraging to
public sector funds.
Reference: Brown et al, 2015
41
(MoSPNDS, 2014). Strategies to attract greater private investment were identified in the Green
Growth Framework for Fiji as follows:
Improving the regulatory environment for starting and operating a business;
Facilitating contract enforcement;
Investment incentives;
Strengthening infrastructure services;
Enhancing access to land, finance and financial services.
Specific policy measures to attract private finance into low emission and climate resilient technologies
and practices were identified as follows:
Table 10 Policy measures to leverage private sector investment in Fiji proposed in the Green Growth framework
Investment area Policy measures
Buildings National building code by end 2016
Incentives to support compliance with new building standards by 2017
Urban land use plan enforcing zoning and buffer zones for coastal areas, river banks, high risk areas and mangrove areas.
Capital budget appraisal guidelines to incorporate risk management Agriculture Incentives for organic farming and investment in greenhouse and hydroponic
technology by 2016.
Encourage development of PPP arrangements in operation collection centres/rural transformation centres by 2017.
Freshwater and sanitation
Demand management initiatives e.g. reviewing tariff rates, introducing rebates and incentives to encourage water conservation and promote water efficiency devices.
Energy Labelling awareness and extend the current system of energy labelling and minimum energy efficient standards to all equipment;
Economic incentives to increase energy efficiency;
Feed in tariffs or pricing framework in order to incentivise RE production;
Process for procurement of new large scale capacity from IPPs, pricing and other principles to be applied to all new power purchase agreements and grid connection standards.
Codes and standards for buildings and industry to provide among others minimum standards for energy use in ventilation, cooling and lighting;
Biofuel standards to facilitate the more economic development of indigenous biofuel resources such as coconut oil.
Technology development
Minimum product standards for imported household appliances;
Lowered or eliminated important duties on low carbon technology.
Tariffs on non-green technologies.
Reference: Fiji Green Growth Framework for Fiji
Fiji government does already use the tax system to encourage investment and deployment of new
technologies. For example, GoF has provided incentives since 2010 to facilitate the establishment of
the costs of water and sanitation projects; in 2011, GoF reduced the fiscal duty on the importation of
desalination and sewage treatment plans from 5 percent to 0 percent; until 2014, a 10 year tax
holiday was available to nationals who undertake a new activity in processing agricultural
commodities into biofuels as long as there was a minimum investment and a minimum number of
employees. A tax holiday is available to a taxpayer undertaking a new activity in renewable energy
and power co-generation. The Fiji Revenue and Customs Authority offers a range of tax incentives to
encourage the production of renewable energy and biofuels. It also offers tax incentives on
contributions to disaster relief fund.
Globally, private sector groups engaged on climate change are organised and have published public
statements on what they need from governments in order to contribute to the investment challenge for
greenhouse gas mitigation (see Box 5).
42
Box 5 Global investor statement on climate change, 2014
4.2 Climate change investment plans and costs The NCF would need to attract funds and this would be done more effectively if it could offer
investment plans that contained informed, site-specific, budgeted adaptation action plans with
estimated resilience or vulnerability reduction estimates attached to them, and credible delivery plans.
That way, investors would be given more confident that the money invested delivers adaptation
returns. National strategies and plans in Fiji have lists of priorities but none of these are costed and
sequenced into an implementation plan. Neither are there measureable targets for adaptation. Nor
are these coordinated and harmonised across Ministry plans and budgets which could pool scarce
domestic and international resources to implement investments that deliver climate change objectives
thereby using money more efficiently.
Many policy, institutional, capacity and practical investment needs have been noted in a range of
reports and strategies in Fiji. The question is how to prioritise; which of the many important policies
and measures should be done first. The proposal made in this report is that the Fiji Government
prioritises on the basis of quantitative targets for resilience and adaptation which it should set to
complement the renewable energy targets indicated in the country’s Intended Nationally Determined
Contribution report (INDC) to the UNFCCC. Once those targets have been established (for example,
sedimentation levels washing down from upstream catchments reduced by 75 percent), an
assessment of the underlying problem causality should be carried out, and a detailed solution
analysis and pathway should be developed, which should include a critical examination of changes
required in the institutional structures responsible for delivering the solutions. In other words, the goal
should frame the strategy which should determine the measures undertaken. The following section
presents what is known about adaptation and GHG mitigation strategies and costs in Fiji.
4.2.1 Adaptation plans in Fiji and cost There are no national adaptation targets and there is very little information on the costs of adaptation
in Fiji. Policy makers will be faced with choices about whether to address an area of vulnerability
though ecosystem management, economic policies (natural resource pricing is one example);
rectifying perverse incentives that increase vulnerability to climate change; or infrastructure
investments. The cost, effectiveness in reducing the risk and/or building resilience and the risk of
The statement was signed by 407 investors representing more than US$24 trillion in assets. It
recognises that while current investments in clean energy alone are approximately $250 billion
per year, that the International Energy Agency estimates that at least $1 trillion per year of
investments are needed between now and 2050 in order to limit the global temperature increase
to two degrees above pre-industrial levels. It called for governments to:
Provide stable, reliable and economically meaningful carbon pricing;
Strengthen regulatory support for energy efficient and renewable energy;
Support innovation in and deployment of low carbon technologies;
Develop plans to phase out subsidies for fossil fuels;
Ensure that national adaptation strategies are structured to deliver investment;
Consider the effect of unintended consequences from financial regulations on
investments in low carbon technologies and in climate resilience.
The following investment groups are represented in the statement:
Asia Investment Group on Climate Change (AIGCC); Investor Group on Climate Change
(IGCC) comprising 52 Australian and New Zealand institutional investors and advisors;
Institutional Investors Group on Climate Change (IIGCC) comprising 90 members representing
some of the largest pension funds and asset managers in Europe; Investor Network on Climate
Risk (INCR) comprising 100 members.
Source: http://investorsonclimatechange.org/statement/
43
unintended consequences are all considerations in identifying investments and developing an
adaptation strategy. Central to the costing exercise is what the role of government should be
(implement directly or through others, develop regulation and enforcement capacity; establish
economic incentives, training and capacity development), how it should interact with the private
sector. A second choice area would be how to sequence adaptation measures since not all
adaptation measures can or should be undertaken simultaneously.
One analysis was recently carried out to compare the costs of protecting Lami Town in the Greater
Suva area with ecosystem-based options versus engineering options and for two combinations of
both types of options. The analysis shows that for all for adaptation scenarios implemented at
suggested locations in Lami Town, estimated benefits ranged from FJ$8 to FJ$19.50 for every dollar
spent on coastal adaptation based on a 20 year timeframe, using a 3 percent discount rate. The
highest benefit-cost ratio was for ecosystem based options with an assumed damage avoidance of 10
to 25 percent. Hard infrastructure interventions would be more likely to be provide 25 to 50 percent
effectiveness in damage avoidance. Box 6 has the details of the cost benefit analysis. Important to
note is that adaptation will not and cannot reduce damages to zero – there will in most cases be a
residual cost to bear. The main issue regarding this is to ensure that development plans and the
implementation of those plans minimise the residual costs that can be expected, e.g. by respecting
land-use plans, and that households to be helped to have the means to recover from the impacts and
continue with their lives and livelihoods. The methodology used in this cost benefit analysis can be
applied to any development area. For example, in the health sector, a cost benefit analysis would
need to consider i) the costs of health damage due to climate change (the ‘do nothing’ comparator) ii)
the costs of the health sector adaptation and iii) the benefit of spending the money on the adaptation
option, which can be calculated as the cost of health damage averted.
With experience over time, Ministries could develop cost-output benchmarks for allocation of budget
to climate change resilience which could also convey clear information about cost-return schedules
for potential investors to the NCF. The adaptation investments plans should be developed within an
overall framework of national adaptation targets and a clear idea of the pathways chosen to deliver
the targets. Of course, there is a lot of uncertainty in whether the pathway chosen is correct and
whether it will deliver the benefits expected (i.e. how environmental and economic systems will
respond to investments made), which is why monitoring and evaluation of the resulting causal results
and ultimately effects on people is so important to inform future planning processes.
44
Box 6 Case study: Details of cost benefit analysis of adaptation options for Lami Town
Table B1 contains the unit costs of adaptation options for Lami Town over a 10 and 20 year time frame,
calculated using a discount rate of 3 percent over time. The difference between ecosystem-based
adaptation options and the infrastructural options is vast.
Table B1 Unit costs of adaptation options for Lami Town, Viti Levu
Adaptation options Unit cost Cost in FJD
10 y 20 y
Replant mangroves m 2 2.76 4.67
Replant stream buffer m 2 2.88 4.87
Increase drainage m 16.29 20
Build sea walls m 1,670 2050
Reinforce rivers: Protect river banks Dredge rivers River realignment
m m 3
m
1144 18.52 923
1404 22.72 1133
The benefits calculation comprises of two elements: the avoided damage of the hazard event and, for
investments in ecosystem-based options, the ecosystem services provided by mangroves, coral reefs,
mudflats and sea grasses, upland forests and streams. The Fijian dollar value per hectare annually of the
direct and indirect ecosystem services were calculated to be as follows:
Mangroves: 158,920
Coral reefs: 658,487
Mudflats/seagrasses: 70,470
Upland forests: 8057
Streams: 1950
The cost of damage avoided per dollar spent in indicated in Table B2. The benefits outweighs the costs
for all options. The specific amount of damage avoided by any one option will depend on how and where
the options are implemented as well as the characteristics of the hazard event. Not all options are equally
effective. Some of the least expensive options would most likely avoid less than 10 percent damages
while other options that may be more expensive could potentially avoid more than 25 percent of
damages.
Table B2 Cost of damage avoided per dollar spent on each adaptation option Adaptation option Assumed percentage of damage avoided – FJD per F$ spent
50 percent 25 percent 10 percent
Replant mangroves 77 38 15
Replant stream buffer 146 73 29
Monitoring and enforcement 1498 749 300
Reduce upland logging 2035 1018 407
Reduce coral extraction 2988 1498 598
Build sea walls 15 8 3
Reinforce rivers 96 48 19
Increase drainage 140 70 28
There are large data gaps regarding both the costs and effectiveness of different adaptation options,
limiting the support of informed decision-making. For example, a high resolution elevation of Lami Town
(including bathymetry) should be developed in order to further identify priority sites for adaptation action,
to enable storm surge and flood modelling and to develop flood height damage curves in order to inform
a site-specific adaptation plan. Other adaptation options could have been included in the analysis such
as policy options (rezoning, regulating land tenure of informal settlements etc.).
Reference: Rao et al, 2012
45
The other source of costed resilience building plans is the recent disaster recovery plan for TC
Winston which struck Fiji in January 2016. The full cost of restoring and enhancing damaged assets
and of restoring lost production flows has been estimated to exceed $1.96 billion (US$98 million).
The total projected cost of the Recovery Programmes has been estimated at F$731 million (US$365.5
million) over the period mid-2016 to mid-2018. One concern is that much of this recovery plan is
about rebuilding of infrastructure which, given the need for construction materials and without proper
land use and sustainable extraction of materials, could undermine ecosystem resilience (See Section
2 for details), thereby creating a negative feedback loop between one disaster and future events.
Table 11 Projected Cost of Recovery Programmes by Recovery Priority – F$ million
Recovery Priority Total Budget Government Donor Unmet
(Financing
Gap)
Priority 1 -- Rebuilding Homes (30,369 homes) 183.94 72.14 0 111.80
Priority 2 -- Restoring Livelihoods (agriculture
and fisheries)
169.65 36.07 9.89 123.70
Priority 3 -- Repairing and Strengthening
Critical Infrastructure
S353.39 25.79 12.04 315.57
Priority 4 -- Building Resilience (relocation of 48
villages or 2255 households; repair and
reconstruction of infrastructure and
investment in ecosystems).
23.88 0 0 23.88
Total 730.86 134 21.93 574.95
Source: Ministry of Economy Estimates, 2016
4.2.2. Greenhouse gas emission mitigation plans and cost The national target is to achieve 100 percent of Fiji’s population served with electricity (from the
current 80 percent) from renewable energy sources and to bring down reliance on wood fuels for
cooking to 0 percent by 2030 (INDC, 2015). The average investment that will be needed to achieve
this is estimated at F$50 million (US$25 million) per annum for 15 years, totally US$375 million. The
total amount of carbon emissions saved by 2030 is 500 Gg (500,000 tonnes) per annum21, taking into
account population increases and economic growth over the period. The additional reductions from
adoption of energy efficiency measures by 2030 is estimated at 250 Gg per annum (10 percent of
2030 emissions) (GoF, 2015). However, the Fiji Energy Policy notes that there is no business plan for
how to reach the last 20 percent of non-electrified communities especially given low affordability
levels. Government-funded rural electrification schemes are heavily subsidised, the community
models often lead to deterioration and inoperability of the systems.
There is no national target in relation to avoided GHG emissions from forest removals nor a costed
strategy in this area. In 2010, the Fiji national carbon stock of indigenous and plantation forestry was
estimated as being 192.27 million tonnes of CO2e. The estimate could be on the low side and efforts
are being made to improve the data quality. The main emitter in the forest sector is logging.
Regulating logging intensity and the reduction of avoidable timber waste potentially leads to avoided
emissions of 165,000 tonnes CO2 per year (Haas, 2015)22. Fiji has a large of degraded and under-
utilised land with potential for afforestation and reforestation to increase its carbon stock.5. Feasibility
assessment
21 In 2013, the electricity sector emitted 340 Gg. 22 Emissions from deforestation are estimated at 33,000 t CO2 per year, due to less than 0.1 percent
annual forest cover loss.
46
5 Feasibility assessment
At a technical level, establishing an NCF in Fiji is feasible: the country has an enabling Financial
Management Act through which GoF could quickly establish the basic legal and financial framework
needed for the Fund, financial management and performance tracking systems are in place, as well
as some enabling legislation, and experience in running investment Funds. There are also on-going
reform processes for financial management, the legal framework and the civil service which could
benefit the establishment of an NCF. What is critically lacking is two things: i) political leadership for
this idea and ii) evidence-based and costed adaptation plans and targets to complement the national
GHG emissions mitigation targets. The Ministry of Economy needs to champion the structure and
operational modalities. It should also agree to invest tax finance in the Fund, both to signal
government intention and commitment to the fund and to build trust among partners.
5.1 Assessment framework The framework for assessing different design options has been structured around the basic question:
Will the NCF alleviate a problem and/or will it create new problems? The worst case scenario would
be one where the baseline problems are not solved and new problems are created. The baseline
problems that were scoped out during the preparation of this report are as follows:
1. Low amounts of financing for resilience building initiatives and for low carbon development;
2. Project-based aid which is a slow disbursement modality and undermines country planning
systems and policy leadership by Government ministries;
3. Low absorptive capacity in government;
4. Weak sustainability of projects,
5. Lack of integrated sector planning leading to unresolved environment/development problems
The main benefits from the establishment of an NCF could be the following:
Table 12 Main benefits expected from the NCF
Brokerage & guidance
Reduce transaction costs in accessing international funding flows;
Develop specialised skills for climate change programming;
Effectiveness Create a streamlined process for channelling of large scale flows of climate finance;
Incentivise & strengthen a coordinated and integrated sector planning process (horizontal and vertical);
Strengthen country planning and budgeting systems;
Attracting funds
Attract climate finance.
The NCF could complement current resource mobilisation efforts by ministries, which currently have
their own bilateral relationships with development partner for funds and technical assistance. It would
be desirable for this to continue as the technical assistance helps to improve planning systems and
the evidential base for planning. The NCF would be complementary by channelling larger scale flows
to support ministry spending plans.
New problems which the NCF could create were scoped out during the consultations carried out for
the development of this feasibility assessment. The main risks were identified as follows:
Table 13 Main risks from the establishment of an NCF
Inefficiency (costs)
Could lead to greater institutional fragmentation (costly);
Create more bureaucracy;
Over-burden management and planning systems;
A distraction from the main civil service reform process;
Creating parallel planning systems;
Ineffectiveness Anti-mainstreaming;
Lack of political commitment;
Will funds be protected for intended purpose?
47
Delivery through government systems.
Attracting funds Where will funds come from to support it?
Some or all these risks can be reduced or eliminated with proper system design and an appropriately
designed action plan for establishment of the NCF.
Table 14 sets out the basic design results that would be expected from different design choices for
the NCF. The best case scenario is Type 1: where the old problem is solved and new problems are
minimised (for example, minimising bureaucracy, costs, delays and lack of transparency in decision-
making). The worst case scenario is Type IV: where the old problems remain unsolved and new
problems are created.
Table 14 Typology of NCF design consequences
Old problem
Solved Unsolved
New problem Minimised I II
Maximised III IV
Reference: Bowornwatha, 2004
5.2 Main design options The two main design options are a fund held by government or a bank. Both could direct funding to a
set of agreed priorities within or outside the regular government planning framework of the country.
Both could attract international private sector financing, The bank could, in addition engage with the
domestic private sector in a wider range of financial strategies in order to promote GHG emissions
reduction and climate resilience. The details now follow.
Option 1a. NCF located in MoE; funds distributed as hypothecated budget support. The NCF is
linked to government budgetary systems from MoE to ministries. It would be hypothecated in the
sense that the funds would be for specific adaptation/resilience or GHG mitigation outcomes and they
would have to be coded appropriately in the government Financial Management Information System.
Reporting would be through the regular KPI system which mandates quarterly reporting (output
indicators) and at mid-term and end of term for investments (outcome indicators). The financing
would be linked to sector plans. In order for the financing to flow to climate change priorities and to
improve results on the ground, sector plans should be evidence-based and reflect consistent
objectives across sectors. Getting consistency across sector plans necessarily means that sector
plans would need to be opened up for scrutiny by a wide range of stakeholders in a consultation
process and agreed sectoral objectives and revised as necessary.
Option 1b: NCF located in MoE; funds distributed as projects: this is similar to option 1a except
for one key detail: the planning integration does not happen at sector level but in the development of
a national adaptation plan and GHG mitigation plan. In other words, the financing would be linked to
the National Adaptation Strategy and a National Mitigation strategy rather than to sector plans. But, as
discussed in Section 3.2.2 this is probably not an effective way of building resilience across the
economy because the adaptation plans are incomplete and attempting to rectify this through a
planning process creates a parallel planning process which risks overburdening planners and creating
more bureaucracy.
Figure 3 illustrates each of these two designs and Figure 4 presents a graphical risk and benefits
analysis.
48
Figure 3 NCF at the MoE: 2 designs
Hypothecated budget support
Project-based mechanism
Option 1a: hypothecated budget support can be classified as a Type II design type (see Table 14): it
does not create new problems but neither does it completely solve the old problems, one of them
being attracting large scale funds. It does serve to correct baseline problems 2 to 5 listed above.
This design option implies a much deeper reform of re-aligning ministry plans, budgets, structures and
capacities according to the priorities that have been scoped out in many natural-resource based
strategies, so that funding is directed to evidence-based investments that have harmonised
objectives. With political will and financial support dedicated to making it happen, the evidence
indicates that this would produce longer-lasting and more effective results for climate change
resilience. But politically this is a more difficult pathway to follow as it challenges power structures
and requires cultural change, for example, in changing a planning system so that open sharing of
data, information and ideas is promoted within and between ministries.
Design option 1b is a project based system design which can be classified as a Type IV NCF design.
The project-based mechanism does not improve the projectised baseline situation nor does it resolve
problems 3 to 5 listed above. It potential creates new problems because of the required parallel
process of planning, supervision, reporting and environmental and social safeguards, which is
especially costly a country with limited planning capacities. The responsibility for selecting project
proposals and arbitrating between submissions would fall to the NCF team with implications for the
transparency of decision-making.
This options avoids the root and branch re-orientation of plans, budgets and ministerial structures
needed to direct funding to investment priorities. But the resilience building effect will be much
smaller because of the lost opportunity to leverage domestic budgets and ministry time and focus and
49
because regular development processes may be complicating factors to achieving results. Disaster
impacts will continue and budgetary resources will continue to be needed for response and recovery
and may become larger towards the middle of the century as the climate signal grows stronger.
Development results will be regressed with every disaster event. The NCF would still need costed
plans with an estimated climate response benefit attached to each investment, as well as
implementation mechanisms.
The project based system could work over the longer term if there are good learning and knowledge
management systems operating in government ministries that can take the results from the resilience
building projects implemented in the adaptation strategy and incorporate the results in future iterations
of Ministry Corporate plans and medium-term development plans; AND a participatory planning
process could be executed to ensure that the climate change solutions identified are supported by
knowledge and experience. Under this scenario, and assuming political commitment to continuous
improvement and a realignment of budgets, mainstreaming could take between 5 and 10 years,
reflecting the time it takes to generate results from investments and to incorporate these results into
the planning cycle.
The benefits and risk analysis for these two options is indicated in Figure 4 below. Designing the
NCF so that it supports country systems through a hypothecated budget support system yields many
of the potential benefits and minimises risks but locating the NCF at the MoE means that more private
sector approaches at the delivery end of implementation will be missed. Stakeholders consulted into
the development of this report also were concerned with a potential risk of funds mis-management.
Designing the NCF as a project based mechanism raises more concerns around the creation of
bureaucracy and failing to strengthen country planning and budgeting processes as explained above.
More of the assessment criteria in Figure are indicated as red in the Figure 4.
Figure 4 Benefits and risks from the two design options
50
Option 2. NCF in a bank; ‘Multiple avenues’ approach: Under this approach, the NCF would be
located in a Bank which would enable it to provide a different offering than grants or budget support.
It would also mean that the Bank could have a direct relationship to third parties in implementing
climate change-relevant investments. As in Option 1, resilience investments could be injected into the
national consolidated budget as per Option 1a (using country systems) or they could be linked to a
National Adaptation and low carbon strategy and investment plan as per Option 1b (country planning
systems are bypassed). With greater fragmentation in the institutional architecture comes greater
coordination and oversight costs. .
Figure 5 illustrates each of these two designs and Figure 7 presents a graphical risk and benefits
analysis.
Figure 5 NCF at a bank; Multiple avenues for supporting investments
2a. Supporting ministries through budget support
51
2b. Supporting ministries through projects
Option 2a could be described as a Type 1 design type: potentially it solves the old problems 1 to 5
and, with good design, need not create new problems (as per Table 14). The NCF would be located in
a bank where it could be tasked to deliver a range of financial products to households and business
as well as disburse funding to third parties such as civil society organisations, as well as performing
as an intermediary in channelling international funding to ministry climate-responsive spending plans.
Option 2b system design could be classified as a Type IV NCF design type, for the same reasons as
indicated in design option 1b – mainly because it would work through a project-based mechanism for
channelling funding to government ministries. The benefits and risk analysis is as follows.
Figure 6 Benefits and risks from the two design options
52
Design option 2a is clearly a safer bet that Design option 2b. Channelling funds for adaptation through
government systems could create the driver for strengthening integrated development plans, creating
resilience in domestic spending and avoided the creation of planning systems. Therefore option 2a
avoids the risks and creates added value to the baseline planning situation. The downside with this
option potentially is bureaucracy. Another decision-making entity and decision-making process (in
relation to third party funding of proposals) is added to the mix, the additional bureaucracy added
depends on how those decision-making processes are designed. For example, the number of
institutions represented at Board level and the degree of automation in the project approval process.
As the analysis above shows, as one goes from a country systems approach to the project approach,
the less likely that the old problems can be solved and the more likely that new problems will be
created (Type IV reform). Therefore the net cost of establishing the NCF will increase. The other
main difference is where the NCF should be located. Hosting the NCF in the Bank potentially is able
to reach more people and business by rationalising the distribution of funding through different
financial products thereby getting past the absorptive capacity issue and allowing funds to go further.
A Bank option allows Fiji to lend out to the private sector for clean energy and/or adaptation
technologies. There are possible green economy benefits from working with and through the private
sector. Therefore the design of the NCF should seek to incorporate funding flows through country
systems with the flexibility of designing strategies to capture private sector funding flows and design a
financial product offering that maximise the reach of the Fund23.
There is a clear added value in the proposed NCF if it were designed to strengthen country planning
systems. It could provide clarity over climate change investment information, it could provide a much
needed driver for coordination between government and development agents, it could drive the
strengthening of delivery systems and better delivery performance.
Design option 2a addresses the principles and objectives for the Fund which were indicated as
important by stakeholders during the mission consultations. The recommended principles were as
follows:
Principles:
transparent;
accountable;
23 This was in fact the adapted system design that was developed during the stakeholder consultations.
53
effective;
accessible;
streamlined;
Independent under its own statute;
Sustainability of funding – long term;
multiple mechanisms;
blending finance and supporting additionality and focus on upscaling;
one common goal: CCA strategy and investment plan.
Avoidance of bureaucracy was a repeated concern among stakeholders in bilateral interviews.
Processes to access funding should be transparent and expedited.
The objective statements determined by stakeholders in the consultation workshop held during the
feasibility assessment process were as follows:
Objective:
to ensure that funds are accessible and effectively and efficiently utilised for its intended
purpose;
to establish a sustainable NCF that is accessible to both public and private sector towards
achievement of common goal;
to promote country-led, climate responsive governance.
For all design options, good learning and knowledge management systems would need to be
operating in government ministries so that they can take the results from the resilience building
projects implemented in the adaptation strategy and incorporate in future iterations of Ministry
Corporate plans and medium-term development plans.
5.3 Recommended design The following sections discuss a recommended design for a potential NCF based on the preceding
analysis in this report. The proposed structure has been put together to have the greatest chance of
attracting funds, to distribute funds in an equitable and rational manner and to lead to effective results
on the ground. A two pronged strategy is recommended on the delivery strategy.
• 1st prong: Bank facilitated NCF to climate change responses in private sector and civil
society: Have the NCF located as a Trust Fund in a bank that is able to access private sector
investment flows internationally and nationally and that is able to design financial products for
adaptation and GHG mitigation technologies for private individuals and entities, reflecting the
private benefits the investments can deliver. In addition, establish a project modality that can
engage third parties contractually and directly, through a small or medium grants window in
order to promote innovation and quick results on the ground. The Bank does not need to be
an accredited entity to the international climate funds if it can access funding from other
sources such as Multilateral Development Banks and international private sector finance (see
Section 4 on the financing landscape globally for climate change and the potential of climate
bonds)
• 2nd prong: Government planning systems to facilitate climate change responses: Work
towards a hypothecated budget support mechanism that can be adopted within a 10 year time
period. This is in order to move away from the project modality that is currently prevalent in
Fiji to a country systems approach that is able to absorb larger scale flows and to fund multi-
year continuity of investments. The public international funds could be disbursed through
government systems directly, using a specific code in the FMIS system for tracking funds and
the Fiji government KPI system of reporting back results. Taking this approach would not
constitute a Fund (unless absorptive capacity was low and funding amounts high) as much as
a facility. It would enable international public funding to finance resilience and adaptation in
Fiji in an effective and efficient way. For example, instead of having to agree a partnership
agreement for every climate-related project, one MOU could be agreed with the relevant
ministry indicating agreed results to be delivered. This facility could strengthen the role of
54
Ministry of Economy, through the CCU, in the coordination of climate change policy
implementation as well as in strengthening the technical aspects of budget preparation. A key
part of this programme would be to establish a research programme to target the most urgent
gaps in the evidence base in order to inform adaptation plans.
Within this 10 year time period, the aim would be to build efficient and effective delivery systems so
that funds can flow to the intended investments. Start small: In the interim carry out the work needed
to develop the information, structures and capacities needed to plan and budget for natural capital,
social and resilience investments. The programme would start with the ministries involved in land-
based management: agriculture, lands, forestry, infrastructure, i-Taukei land Trust Board etc. The
analytical products would be discussed and agreed within and between departments and ministries
and would be packaged as projects for financing. This phase may take two years from start to finish.
The next step of designing ministry plans and budgets, performance frameworks, skills development
and departments restructuring where necessary would follow. This phase may take another two
years. Implementation of investments through government structures, designing partnership
agreement with NGOs and CSOs and private sector organisations, strengthening monitoring and
evaluation capacity over implementation processes, and compiling performance reports could take
another four years. Meanwhile annual plans and budgets are developed as part of routine
government business, which should be informed by analytical products commissioned in a continuous
process by the given ministry.
GoF financing should be used to finance some of the costs in the mainstreaming process and to
finance some strategic cross-sectoral implementation investments. It would be helpful to find a
strategic partner to provide financing for this interim phase.
A Board would be required for the Trust Fund held at the bank. A review of national funds for
conservation indicates that the Board should be composed of a diverse range of stakeholders but not
too many so as to facilitate decision making. This participatory structure means that funds are more
likely to be distributed fairly. (Bladon et al, 2014).The composition of the Board is critical to ensuring
the Fund is managed and used as intended. The entire Board should receive solid and professional
training on key technical concepts in order to make informed decisions. Fund should not be seen as
competition to Government but a mechanism to support development strategies.
In terms of staffing costs, working through country systems is the most cost effective approach since
country planning and implementation structures and processes would be used as the planning and
implementation mechanism for the NCF. Going for a project-based mechanism will be expensive.
One analogy can be drawn from the Global Fund for AIDS, TB and Malaria in the Ministry of Health.
A unit set up for management of this Global Fund in Fiji has a team of 11 people, managing a budget
of F$20 million to F$30 million. Climate change costs in the areas of low carbon development and
adaptation could be several orders of magnitude higher requiring a much larger Secretariat to handle
these larger flows. .
5.3.1. Monitoring, evaluation and learning The adaptation and GHG mitigation plans should have costs and quantified climate results attached
to them. This is in order to provide certainty to international investors as to what their financing will
deliver and to help the implementers stay focused on results delivery. Delivering resilience results is
an uncertain business as there are many factors that can mediate the implementation process.
Monitoring and evaluations will be particularly important. Over time, it should be possible and indeed
desirable to develop output benchmarks that can help the interactive process of planning and budget
preparation and allocation. For example, sustainable farming practices costs F$x per hectare or
costal protection through ecosystem approaches costs F$x per km of coastline or building 1km if
roads with minimal disturbance to ecosystem function costs F$x. With data collected on loss and
damages from extreme weather events, it should also be possible to link these output benchmark
data with social impacts to begin to develop an adaptation net cost/net benefit curve. This will
ultimately serve to improve the evidential basis of sector development plans and budgets, which
should have a material impact on development results.
55
The learning element is essential. As indicated earlier, budgets in Fiji are currently determined
incrementally based on previous year allocations. The budget therefore does not reflect policy
priorities, even if these were correctly identified in departmental spending plans. As discussed earlier,
there is a great deal of fragmentation in government departments which a poor record of coordination
and joint planning. For improved resilience to climate variability and change planning efforts must be
improved. It is suggested that an improved focus on data and information and greater internal
learning processes about what works and why will help in the process of planning for climate change
resilience.
6. Action plan for establishing the NCF
This action outlines the actions needed to establish the NCF as per the recommended design outlined
in the previous section. These actions are in relation to strengthening the key elements of the
institutional system, as described in Section 3: supportive legislation, policies and strategies and
public financial management, performance management, human capacity and environmental and
social safeguards. It is proposed that this action on the second prong of the NCF relating to
government planning systems should be delivered in one geographical area: a set of Districts relevant
to the effective functioning of a watershed to be selected according to criteria such as a committed
local government leadership and willing communities to participate. The timeframe for this part of the
programme would be over eight years working on the pilot, area-based approach with another two
years dedicated to scaling up to the sector level. This approach is likely to require extensive
institutional reform, e.g. organisational restructuring so that ecosystem and climate change linkages
are more effectively addressed across economic development strategies. This proposed Action Plan
is in line with the Actions scoped in the National Climate Change Policy and the Fiji Green Growth
Framework for Fiji.
This action plan has a tentative budget estimated for it which should be revisited in a detailed design
phase of this Action Plan should this work progress.
The actions are determined as follows.
1. Establish national adaptation targets that are based on addressing exposure and underlying
sensitivity to the risk as well as building adaptive capacity.
Prong 1: Bank-facilitated NCF for climate change responses
2. Determine which share of the national GHG emissions mitigation and adaptation (‘climate
change’) targets can be delivered through the private sector in pure and blended financial
products;
3. Determine the strategy for engaging a partner bank to provide financial services to deliver the
share of the targets. This should include the financial strategy for the government to co-
finance financial products as necessary, reflecting the public benefits share of total benefits
derived from the policy measures;
4. Determine the best mix of policy instruments which could be established to send policy
signals to households and businesses to invest in low carbon technologies and climate
resilience;
5. Develop the strategy to engage with the international private sector and multilateral
development banks;
6. Develop the strategy, funding rules and procedures for engaging with third parties such as
NGOs and academic institutions. The strategy should be designed to contribute to delivering
the national targets on adaptation and GHG emissions mitigation as well as to generate
learning that could inform and progress national policies and plans
7. Set up the Board to oversee the NCF with a Terms of Reference, rules of engagement,
technical guidance and a programme of technical training for Board members.
8. Develop a strategy and campaign to raise public awareness and understanding of climate
change, how it interacts with everyday economic processes in the country and where the
56
solutions to deal with the problem lie. This activity could pick up the idea of supporting
biennial natural resource summits included in the Green Growth Framework for Fiji. The aim
would be to generate demand for the Bank financial products.
Prong 2: Government planning systems to facilitate climate change responses
9. Determine which share of the national adaptation targets can be delivered by a range of
public sector policies and measures. For example, if one of the national targets is achieving
access of 100 litres per person per day throughout the year for all households now and to
2050, then one of the key measures might be effective metering and charging for water at a
price that incentivises water conservation; another measure might be developing dams and/or
watershed protection and/or developing conjunctive surface and groundwater management
systems.
On the basis of existing information, the proposal is then to develop the climate change
pathway to deliver the targets aimed at establishing new practices, technologies and
behaviours that is targeted at reducing vulnerability to climate variability and change. This
would need to be based on an agreed land use plan in the given area based on maintaining
or restoring ecosystem function given what is known about the expected range of climate
change hazards and impacts together with the projected socio-economic. The measures that
are net least cost (no regrets options) should be implemented first. The various activities in
the climate change strategy should be costed, have clear resilience benefits estimated for
each of the activities and have indicators and targets attached to it.
10. In relation to a specific area and according to the climate change targets that should be
delivered, improve the information base; determine what is known about the causality of
drivers that lead to the underlying sensitivity to climate variability and change and where the
gaps or conflicting areas of understanding are and design a specific and time-bound and
results-based analytical research programme to obtain data and information. The aim should
be to generate better data that is aligned to Ministry key interest which should help incentivise
coordination and better planning connections between ministries and departments. This
should be developed in close cooperation with the DoE in order to contribute to the National
Resource Inventory. The research programme should, as far as possible, be developed
along action research lines involving civil society organisations, local communities and
schools where possible in order to raise awareness and commitment to the strategy;
11. Determine the legal and policy gaps and inconsistencies to support the strategies identified
above, and develop a work plan and timetable to further develop a supportive legal and policy
framework;
12. Determine how the relevant ministries plans, budgets and performance framework
contribute to or detract from achievement of the climate change targets; engage in a process
of consultation and raise awareness and understanding; refine KPIs so that Ministry plans are
aligned to the climate change strategy;
13. Undertake an analysis of the delivery challenges in each of the relevant ministries working
the given geographical area and determine a work plan to address the challenges. This could
include financial management, project management and planning and contracts management
regarding delegation to third parties. The work plan to address the deficiencies in public
financial management should be aligned to the current financial management reform process
led by the MoE.
14. Determine how well the current institutional structure and staff skills profiles serves the
implementation of the adaptation strategy and proposed action plan for revised staff team
profiles and job descriptions in different ministries and decentralised government structures
and a training programme for delivering the skills and capacity upgrading. This could include
training on the legal framework and understanding what take precedence when as well as
changes underway, technical understanding of environment-economic-social linkages;
financial management, project management, results monitoring and environmental and social
safeguards.
57
15. Develop a knowledge management strategy for the ministries involved and establish the
systems for the effecting functioning of the strategy. This will include IT systems
development. Monitoring should seek to derive answers in relation to baselines and targets
(considering complex contexts and shifting baselines); measuring attribution of project
interventions, explaining how an intervention leads to an effect (causality) and monitoring
direct and indirect effects (including unintended consequences).
Table 16 provides further details on the action plan. The actions together add up to a three year work
plan to get Fiji to the point where it could establish an NCF and a National Climate Facility for support
to ministries. The tentative budget attached to this Action Plan is US$1.44 million.
The estimated and tentative budget indicated in Table 16 is for one selected watershed as a pilot to
be replicated in all other watersheds on the two main islands of Fiji and is therefore on the lower
bound of what would be needed to establish the investment pipeline for the NCF and National Climate
Facility. A great many of the actions contained in the Green Growth Framework for Fiji could be
picked up in the proposed Action Plan, and the costs may vary substantially from the estimates
provided in Table 16. Cost estimates provided here are tentative. The exact details of the design of
each of these measures with a more detailed costing should be carried out.
The main relevant actions from the Green Growth Framework for Fiji that can be picked up in the
establishment of the National Climate Facility include the following:
Thematic area 1: Building resilience to climate change and disasters
Development of a Local Government Self-Assessment Tool for Disaster Resilience by 2016;
Review the town plan regulations to facilitate the enforcement of zoning and bugger zones for
coastal areas, river banks and mangrove areas.
Mainstream cost-benefit analysis into decision-making processes in disaster mitigation and
preparedness measures by 2017.
Encourage collaboration with development partners and tertiary institutions in conducting
research on priority areas with climate change and disaster risk reduction by 2017.
Develop hazard maps and models for all potential hazards by 2020.
Partner with civil society in undertaking capacity building at divisional and community level on
building resilience including through incentivising performers/performance.
Undertake vulnerability assessment for all communities by 2019.
Develop climate and disaster resilience plans for urban and rural communities by 2019.
Capacity building provided to communities which need to be relocated.
Thematic area 3: Sustainable island and ocean resources.
Develop a natural resource management system which is inclusive and integrated.
Build community-based integrated resource management initiatives and replicate in all
Provinces by 2016 in partnership with community, NGO, private sector and development
partners;
Improve coordination of all resource management activities by legislating coordination
functions of the Divisional Commissioners Offices by 2015;
Capacity building and awareness programme with all communities, with emphasis on
resource owners, on the importance of environmental stewardship.
Strengthen environmental education in schools through more practical hands on learning.
Undertake results oriented awareness programmes that provide practical demonstration of
impact of development on ecological services;
Undertake awareness and capacity building with communities, district, provincial and
government to strengthen understanding and appreciation of marine ecosystem services by
2016.
Encourage data sharing among key stakeholders under the National Environmental Council
structure by 2015.
58
Formalise partnerships with tertiary institutions and regional and international organisations in
undertaking research by end 2015.
Strengthen the capacity of the Fiji Bureau of Statistics to collage and report on natural
resource and environment related data.
Develop a framework to establish a land use plan for the whole of Fiji by 2015.
Strengthen partnerships between government, civil society and communities by establishing
forums at district and provincial level to discuss environmental issues and share experiences
and good practice.
Conduct awareness for resource owners on legislation governing resource management and
the environment, in particular on their roles, responsibilities and obligations under law;
Increase the capacity of line agencies in relation to resource management.
Thematic area 6: Freshwater resources and sanitation management
Adoption of watershed management plans using integrated water resources management
principles for major rivers, waterways and drainage systems;
Build capacity for resource owners to incorporate the notion of environmental stewardship in
their community project proposals.
Develop an integrated database on national water use, extraction and replenishing rates and
disseminate widely for water resource planning;
Thematic area 7: Energy security
Establish economically justified feed in tariffs or pricing framework to incentivise renewable
energy generation;
Undertake a study to develop an independent power producer framework;
Establish a transparent process for procurement of new large scale capacity from IPPs,
pricing and other principles to be applied in all new power purchase agreements and grid
connection standards.
Increase public education and awareness of energy efficiency options;
Extend the current labelling system and minimum energy efficiency standards;
Providing financing and economic incentives to increase energy efficiency and decrease
energy intensity.
Update the energy efficiency codes and standards for buildings.
Review of current biofuel standards to facilitate development of indigenous biofuel resources.
Improve the effectiveness and sustainability of management models for off grid rural
electrification;
Establish a framework for encouraging off-grid rural electrification projects by NGOs and
CSOs and private sector.
Table 15 Action plan for establishing the NCF
Action area Activity Time (months)
Cost (000 US$)
1. Establish national targets Carry out a consultancy study to identify resilience and adaptation indicators and targets based on national strategies.
Hold participatory workshop to agree on the targets.
5 30
2. Develop the policy and measures pathway to reach the target and the corresponding business plan
Second part of the consultancy.
Hold a participatory workshop to agree on the policy and measures pathway.
5 30
2b Develop partnership agreement with the Bank to administer the NCF and the financial strategy to deliver
Procurement
Development partnership agreement
Consultancy to develop the financial strategy
Bank to develop financial products.
18 20
59
the adaptation and GHG emissions strategy
2c Develop the strategy for engaging with the international finance institutions and developing the financial product offering to consumers and engagement strategy with third parties
Procurement
Stakeholder consultation workshop
6 30
2d Develop NCF Board rules of engagement and technical training
Government consultations
Training
3 20
2e Develop the strategies for improvement of the enabling environment for private sector financing of climate change responses.
Consultancies;
Consultation workshops;
Standards development
Policy revisions
18 200
2f Develop strategy and campaign to raise public awareness and understanding of climate change and solutions.
Consultancies
6 50
3b. Identify gaps in the legal and policy framework and develop a prioritised work plan to address the gaps.
Consultancy
Workshop
3 30
3c Develop updated laws, regulation and policies to support the climate change responses pathway identified above.
Consultancies;
Government coordination processes
Leadership and technical training
24 200
3d. Realign Ministry plans and performance frameworks to be aligned to the climate change strategy.
Consultancies
Consultation processes;
12 50
4a. Organisational and training needs assessment and training programme development
Consultancies;
Government coordination processes;
Training budget
12 200
4b. Analysis of delivery challenges and work plan to address the needs
Consultancy
Training
4 30
4c. Work plan to address implementation challenges implemented
Consultancy
Training
Systems development
12 50
4d Establish knowledge management systems in the key ministries
Consultancy
Training
Systems development
12 50
5. Targeted analytical work to address contested areas in developing a climate change strategy,
Consultancies
Workshops/consultations
Exposure visits
18 250
6. Public awareness strategy 24 200
Total cost (US$) 1,500.000
Figure 7 provides a schematic representation of the timing and sequencing of the activities contained
in the Action Plan. The activities for the establishment of the NCF are grouped into three distinct
categories: i) establishing the national climate change targets and policy pathways ii) developing the
country systems approach: a legal, policy and institutional problem analysis and action plan to
address the gaps iii) developing the strategy for the NCF. With no delays, investment flows could
being from year 3 onwards.
60
Figure 7 Sequencing and timing of activities in the Action Plan
61
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Annex 1 Details of consultation mission for the preparation of this report
Schedule of meetings and informants
73 stakeholders participated in 30 bilateral interviews during the two week mission. This contains the
names and designations of the key informants and most of the names and designations of other
stakeholders present in the meetings. The table will be completed for inclusion in the feasibility
assessment report.
Date Agency Time # Participants Name of Participants Positions
UNDP and GCF team 8.30-12.30 3 Winifereti Nainoca/Nanise Boginivalu/Jeremy Hill
Dep. TL UNDP/ National Coordinator GCF readiness
programme/ Consultant, GCF readiness programme
Fiji Development Bank 2-3 2 Navitalai Cakacaka, Mr. Toganivalu GM & CEO
Prime Ministers Office 9-10 3 Yogesh Karan/ Edward Tunidau/ Peniana Lalabalavu
Permanent Secretary/Deputy Secretary, Development
Cooperation and Facil itation Division/??
Ministry of Finance 10.30-12.30 4 Makereta Konrote/Ledua Vakaloloma/??? Permanent Secretary/Head of ODA Unit/???
The Solicitor General 2-3 2 Glenys Andrews & Timaima Vakadewa
Live and Learn (NGO) 3.30-4.30 2
iTaukei Affairs 9-10 3 Josefa Toganivalu/?? Principal Administration Secretary/??
Rural and Maritime Development and
National Disaster Management 10.30-11.30 4 Permanent Secretary/??
Agriculture 12-1 4 Jitendra Singh/?? Permanent Secretary/??
Trade & Industry 3.30-4.30 3 Shaheen Ali/?? Permanent Secretary/??
Fisheries & Forests 9-10 3 Samuela Lagataki/Eliki Senivasa/George Madden
Permanent Secretary/Deputy Conservator of
Forests/Acting Director of Fisheries
Land & Mineral Resources 10.30-11.30 4
Malakai L. Nalawa/ Teke Kaake/Raijeli Taga/Lia
Tuivuya
Deputy Secretary/Acting Assistant Director
Lands/Acting Director Mineral Resources/Senior
Lands Officer
USAID funded project: ISSAC 12.30-1.30 1 Vuki Buadromo Project Manager
Public Enterprises 2-3 7 Kolitagane/Sujeet Chand/Laisa Bolalevu/
Permanent Secretary/Acting Director Policy &
Divestment /Acting Director Monitoring
JICA 4.30-5.00 2
Health 9-10 4
Dr. Eric Rafai /Vasiti Taylor /Vimal Deo /Robert
Sovatabua
Deputy Secretary Public Health/GM GMU/National
Health Emergency & Disaster Management
Coordinator /National Health Relations & Business
Development Officer
Local Government, Housing & Environment 10.30-11.30 1 Aminiasi B. Qareqare Director of Department of Environment
EU Funded project PAC TVET 12-1 2 Helene Jacot Des Combes/Leigh-Anne Buliruarua Senior Lecturer/Regional Coordinator
German Technical Cooperation 2-3 1 Christine Fung Land Use Planning & Facil itation Specialist/Dep. TL
International Union for Conservation of
Nature (IUCN) 3.30-4.30 2 Taholo Kami; Andrew Foran
Regional Director Oceania/Head, Pacific Centre for
Environmental Governance
Climate Change Division, Ministry of Finance 5 1 Ovini Ralulu Head of Climate change Division
University of South Pacific/Pacific Centre for
Environment & Sustainable Development
(PACE) 9-10 1
Dr Morgan Wairiu Deputy Director
European Commission 1-2 1 Thierry Catteau
Development Cooperation Coordinator Natural
Resources and Infrastructure
Infrastructure & Transport 2.30-3.30 4 Paul D. Bayly/?? Permanent Secretary/??
New Zealand aid 3.30-4.00 2 Brendan Sherry/Willy Morrell
First Secretary - Development/ Development
Manager - Climate Change
UK Foreign & Commonwealth Office 8.30-9.00 1 Daniel Lund Head of Climate Change and Regional Affairs
World Wildlife Fund 9-10 3 Sarah Bailey/Alfred Ralifo Conservation Director/Policy officer
Pacific Islands Forum Secretariat 11-12 1 Exsley Taloiburi
Climate change Finance Adviser, Strategic
Partnerships and Coordination Programme
Conservation International 1-2 1 Susana Waqainabete-Tuisese Programme Director
AusAid 3-4 1 Christina Munzer Counsellor, Development Cooperation
14-Jun
10-Jun
07-Jun
06-Jun
08-Jun
09-Jun
13-Jun
65
Agenda for stakeholder consultation workshop
Time Session Time slot Content
Registration and coffee: 8.00 to 8.30am
8.30am 1. Opening and
introductions
1 hour Introductions
Presentation on the benefits and challenges
of an NCF
Discussion
9.30 – 11.15am 2. The current situation:
accessing and manage
funds for climate
change-relevant
investments
45 mins
preparation
Presentation on GCF performance framework
SWOT analysis of current situation
Wrap up
10.15-10.30am TEA BREAK
Session 2 cont’d 30 minutes
feed back
15 minutes
wrap up
11.15 -2.15pm 3. Future scenario:
Design of the NCF.
1 hour
preparation
Proposed objective of NCF;
Proposed design for the NCF;
Main barriers, risks and solutions for:
1. Attracting funds 2. Delivering through country systems; 3. Performance management: outcomes
and impacts; 4. Fund management and governance; 5. Integrated investment plan development
Breakout groups
Discussion
12.15 – 1.15pm LUNCH
3. Design options
cont’d
30 minutes
feedback
30 feedback
2.15 -3.45pm 4. The roadmap to
transition to an NCF
1.5 hour
45 minutes
preparation
30 mins
feedback
30 minutes
wrap-up
Stock-taking: core processes, tools, systems
that can be used as the basis for an Action
Plan to establish the NCF.
Wrap-up
3.45-4.00pm TEA BREAK
4.00-4.15pm 5. Conclusions and final remarks