Transcription

WORKING PAPERWORKING TOGETHER FORCLIMATE RESILIENCEChallenges and success factors for collaborationbetween technical and financial partners indevelopment cooperation

WORKING PAPERImprintAUTHORSAnnica Cochu and Tobias HausotterPICTURESCover photo: SteveWillardPhotographyPage 10: Yuri Arcurs – Shutterstock.comPage 12: Eric James Ward – Unsplash.comPage 16: Bill Oxford – Unsplash.comPage 20: kaleidico – Unsplash.comPage 23: STILLFX – Shutterstock.comPage 28: optimarc – Shutterstock.comPage 29: Martin Sanchez – Unsplash.comPage 57: Jana Sabeth – Unsplash.comPUBLISHERadelphi research gemeinnützige GmbHAlt-Moabit 9110559 BerlinP 49 (0)30-89 000 68-0F 49 (0)30-89 000 [email protected] AND DESIGNSCHUMACHER — Brand Interaction Designwww.schumacher-visuell.deSUGGESTED CITATION:Cochu, Annica and Tobias Hausotter 2019: Workingtogether for climate resilience – Challenges and successfactors for collaboration between technical and financialpartners in development cooperation. Berlin: adelphi. 2019 adelphi research gemeinnützige GmbH, December 2019DISCLAIMERThe analysis, results and recommendations in this paper represent the opinion of the authors and are not necessarilyrepresentative of the position of any of the organisations listed below. For the texts in this publication, adelphi grants alicense under the terms of Creative Commons Attribution-NoDerivatives 4.0 International. You may reproduce and sharethe licensed material if you name adelphi as follows: “ adelphi, CC-BYND 4.0”. Photographs and graphics are not coveredby this license. In case of doubt please contact adelphi prior to reusing the material.This paper is part of the Support Project for the Implementation of the Paris Agreement (SPA), implemented by the DeutscheGesellschaft für Internationale Zusammenarbeit (GIZ) and funded by the International Climate Initiative (IKI) of the GermanFederal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU).The authors are very grateful for the extensive input provided by the GIZ’s Support Project for the Implementation of theParis Agreement (SPA).Supported by:based on a decision of the German Bundestag2

WORKING PAPERTable of contentsList of boxes 4List of figures 4List of tables 4List of abbreviations 5Executive Summary 61 Introduction 102 Overview of the international development cooperation landscape 122.1 Actors and activities in development cooperation 122.2 International efforts for effective development cooperation 143 Forms of practical collaboration 163.1 (A) Informal cooperation to foster investments by financial institutions 173.2 (B) Formalised cooperation for joint project implementation 183.3 (C) Technical support with funding from financial institutions 194 Challenges for technical-financial collaboration 204.1 Tensions between organisations’ requirements or procedures 204.2 Lack of structures and resources for bottom-up cooperation 214.3 Unfavourable local framework conditions for collaboration 214.4 Relevance of challenges for partnership forms 225 Entry points for fostering partnerships 235.1 Planning and standardisation to ease alignment processes 235.2 Maximising use of available structures and resources 245.3 Working on framework conditions 255.4 Organisation- or programme-wide entry points 266 Conclusion 28ANNEX IExamples of collaboration 30(A) Informal cooperation to foster investments by financial institutions 30(B) Formalised cooperation for joint project implementation 38(C) Technical support with funding from financial institutions 51ANNEX IIOverview of interviews 54Bibliography 553

List of boxesBOX 1Use of terms in this reportBOX 2Background on categories and case studiesBOX 3Potential complementary strengths of technicaland financial partnersWORKING PAPERList of tablesTABLE 1Cases analysed for this working paperTABLE 2Examples of category A collaborationsTABLE 3Examples of category B collaborationsTABLE 4Examples of category C collaborationsList of figuresTABLE 5Potential effects of challenges on different formsof collaborationFIGURE 1Providers of technical and financial assistance(source: authors)FIGURE 2Overview of challenges and entry points forcollaboration (source: authors)FIGURE 3GET.invest Approach (GET.invest 2019)FIGURE 4EBRD-UNIDO cooperation scheme in Morocco(UNIDO 2018)4

WORKING PAPERList of abbreviationsADBAsian Development BankIKI Internationale Klimaschutzinitiative (GermanAFD Agence Française de Développement (FrenchAfDBInternational Climate Initiative)Development Cooperation Agency)ILRIAfrican Development BankINFONAVIT Instituto del Fondo Nacional de la Vivienda para losBMU Bundesministerium für Umwelt, NaturschutzTrabajadores (Mexican Institute of the National Fundund nukleare Sicherheit (Federal Ministry for thefor Workers’ Housing)Environment, Nature Conservation, and NuclearIPCCIntergovernmental Panel on Climate ChangeSafety (BMU)JFMJoint Forest ManagementJICAJapan International Cooperation AgencyBMZ Bundesministerium für wirtschaftlicheZusammenarbeit und Entwicklung (Ministry forKfW Kreditanstalt für Wiederaufbau (GermanEconomic Cooperation and Development)BNDES Banco Nacional de Desenvolvimento Econômico eCDBInternational Livestock Research InstituteDevelopment Bank)MorSEFF Morocco Sustainable Energy Financing FacilitySocial (Brazilian Development Bank)MRVMonitoring, reporting and verificationCaribbean Development BankNAMANationally Appropriate Mitigation ActionsNAPNational Adaptation PlanNationally Determined ContributionCDC United States Centers for Disease Control andPreventionNDCCDIACities Development Initiative AsiaNORAD Norwegian Agency for Development CooperationCMTCore Management TeamODACONAVI Comisión Nacional de Vivienda (Mexican NationalOfficial Development AssistanceOECD Organisation for Economic Co-operation andHousing Commission)DevelopmentDACOECD Development Assistance CommitteePOPsPersistent organic pollutantsDANIDADanish International Development AgencyPPIAF Public-Private Infrastructure Advisory FacilityDFIDevelopment Finance InstitutionPPPsPublic-private-partnerships: PPPsDFIDDepartment for International DevelopmentPRCProgram Review CommitteeDWWTDecentralised Wastewater TreatmentREDD Reducing Emissions from Deforestation and ForestE.F.O.Externally Funded OutputDegradationEBRD European Bank of Reconstruction and DevelopmentREMREDD Early MoversEIBEuropean Investment BankSDGsSustainable Development GoalsFAFinancial assistanceSECO Secrétariat d’État à l’économie (Swiss StateFAO Food and Agriculture Organization of the UnitedSecretariat for Economic Affairs)NationsSEFAFEIFacility for Energy InclusionSFB Serviço Florestal Brasileiro (Brazilian ForestFIPForest Investment ProgramGCCA Global Climate Change Alliance PlusGCFGreen Climate FundGCIPGlobal Cleantech Innovation ProgrammeGEFGlobal Environment FacilityGIZ Deutsche Gesellschaft für InternationaleService)SHF Sociedad Hipotecaria Federal (Mexican FederalMortgage Society)SIDA Swedish International Development CooperationAgencyTATechnical assistanceZusammenarbeit (German DevelopmentTAFTechnical Assistance FacilityCooperation Agency)TCTechnical CooperationUNUnited NationsUNDPUnited Nations Development ProgrammeUNEPUnited Nations Environment ProgrammeCenterUNICEFUnited Nations Children’s FundIndependent Evaluation GroupUNIDO United Nations Industrial Development OrganizationGPEDC Global Partnership for Effective DevelopmentCooperationGSDRC Governance and Social Development ResourceIEGSustainable Energy Fund for AfricaIFAD International Fund for Agricultural DevelopmentUSAID United States Agency for International DevelopmentIFCInternational Finance CorporationWBWorld BankIFFImInternational Finance Facility for ImmunisationWHOWorld Health Organization5

WORKING PAPEREXECUTIVE SUMMARYDevelopment in line with all or most of the Sustaina-adaptation. Climate change will exacerbate challengesble Development Goals (SDGs), the Paris Agreement,of sustainable development and increase the need forNationally Determined Contributions (NDCs), Nationalfunding 1, thus making it even more important to useAdaptation Plans (NAPs) and country- or sector -spe-available resources in efficient ways. Collaboration andcific objectives and frameworks is immensely challeng-coordination between technical and financial actors areing. International technical and financial cooperationcrucial to maximising the impact of scarce (financial)can support countries and subnational entities such asresources – only concerted efforts will allow buildingcities, states and provinces, in developing capacitiesthe framework conditions and project pipelines re-and accessing finance for development. The results ofquired for an adequate response to climate change insuch cooperation are likely to be best if organisationsline with increasingly ambitious NDCs.work hand in hand to ensure effective and efficientThe paper first provides an overview of the interna-use of available resources. However, actors in devel-tional development cooperation landscape and thenopment cooperation often have heterogeneous andanalyses the different forms of and challenges forsometimes competing strategic perspectives, institu-practical collaboration between financial and technicaltional set-ups and aid instruments, translating intoorganisations. It concludes with entry points for foster-high management costs for recipient governments.ing effective partnerships.International discussions to foster coordination andharmonisation between donors, which culminated inOverview of the international development2005 with the Paris Declaration on Aid Effectiveness,cooperation landscapehave led to the emergence of a number of good practic-International development cooperation compriseses for donor coordination. Yet, results on aid effective-both technical and financial aspects. The technicalness have stayed behind expectations and the focus ofdimension serves to foster individual human skills,efforts has seemingly shifted back to individual actionsstrengthen institutions and create systems that allowthe results of which can be clearly assigned to stand-individuals and institutions to grow and to create aalone organisations. At the same time, more attentiontransformation for development. The transfer of finan-is devoted to collaborating with the private sector as acial resources for investments to developing countries,key stakeholder group for fostering and implementingin turn, is referred to as aid, development finance, fi-resilience measures.nancial assistance or financial cooperation.Acknowledging previous and on-going discussionsTechnical and financial assistance are implementedon aid effectiveness, this working paper seeks to shedby various types of organisations. Important actors forlight on challenges and entry points for practicaldevelopment cooperation include multi- and bilater-collaboration between technical and financial devel-al organisations such as specialised United Nationsopment partners in projects on the ground. Usingagencies and bilateral or regional development banks,insights from several cases of practical collaboration,and their associated theme- or geography-focusedthe paper means to:initiatives. While some of these organisations focus contribute to the understanding of how technicalon providing either technical or financial assistance,and financial organisations work together practicallyothers offer both. Beyond the public sphere, privateto create joint impact;companies and non-governmental or non-profit or- provide entry points for project managers and donorganisations are also involved in delivering technicalorganisations on how to increase collaborative ac-cooperation and, to some degree, financial assistance.tion between technical and financial partners; and toMany variables, from flexibility in use of funding to the stimulate further consideration, discussion and in-number of local staff, determine how these actors candepth analysis of the topic by project managers andcollaborate with other organisations.organisations wishing to leverage synergies withother actors of development cooperation.Even though relevant for most fields of developmentcooperation, the paper is primarily meant to informpractitioners working on building climate resiliencethrough climate change mitigation and, in particular,1 For example, according to UN Environment’s Adaptation FinanceGap Report, USD 140-300 billion annually may be required foradaptation in developing countries alone by 2030, while thefinance needs could reach USD 280-500 billion by 2050.6

WORKING PAPERForms of practical collaboration between financialfor conferences). Involved parties can have the sameand technical organisationsdegree of responsibility and control, or one organisa-Beyond cooperation and coordination on the organi-tion can be in the lead. Partnerships could be for co-fi-sational level, a myriad of formal and informal part-nancing of investments, for joint knowledge creationnerships exist on the project level. Such partnershipsor for other purposes. Overall, each partnership formcan be formal or informal and can take place over sig-has its own dynamic.nificant periods of time or as “one-off” activities (e.g.For this working paper, the following examples ofpractical collaboration have been analysed:TABLE 1Cases analysed for this working paperExampleSummaryWastewater management in VietnamGerman Development Cooperation Agency (GIZ) supported urbaninvestments by Asian Development Bank (ADB) and World Bank (WB).Get.invest – Renewable energypromotion in sub-Saharan AfricaGIZ supports match-making of renewable energy projects with a variety ofdifferent financing institutions.Sustainable forest management inKyrgyzstanGIZ supported WB investments into sustainable forestry in Kyrgyzstan.Financing energy and resourceefficiency in MoroccoUN Industrial Development Organization (UNIDO) and GIZ informallysupported identifying SMEs eligible for funding from the MoroccoSustainable Energy Financing Facility (implemented by the European Bank ofReconstruction and Development, EBRD).Tropical forest management in BrazilGIZ and WB collaborate to implement watershed restoration measures inBrazilian savannahs.Climate-smart livestock systems inAfricaGIZ, the International Livestock Research Institute and the WB collaborate tofoster climate-smart livestock farming.NAMA Support Project “New HousingNAMA in Mexico“GIZ and Kreditanstalt für Wiederaufbau (KfW) support(ed) theimplementation of energy efficient buildings in Mexico.Sustainable forest management inTajikistanGIZ collaborated with KfW to implement sustainable forest managementprojects in different regions of Tajikistan.Cities Development Initiative for AsiaGIZ collaborated with ADB to address gaps in development and financing ofsustainable infrastructure projects in cities.Gavi – The Vaccine AllianceWorld Health Organization (WHO), United Nations Children's Fund (UNICEF),US Centers for Disease Control and Prevention and WB cooperate to increaseaccess to immunisation.Global Cleantech InnovationProgrammeWith funding from the Global Environment Facility (GEF), UNIDO fostersstart-ups in countries across Africa and Asia.Public-Private InfrastructureAdvisory Facility (PPIAF)PPIAF is a multi-donor technical assistance facility that is financed by elevenmultilateral and bilateral donors.Village Enterprise DevelopmentImpact BondVillage Enterprise collected funding from banks for local developmentprojects through a results-based “impact bond”.7

WORKING PAPERAn analysis has shown that the selected case studiesbe realised if the involved actors are willing and ablemay be clustered into three broad categories:to “go the extra mile” for them.A. Informal cooperation to foster investmentsB.C. Unfavourable local framework conditions for col-by financial institutions: Actors engaged inlaboration: Local project contexts may fail to pro-one field (e.g. technical cooperation) shapemote collaboration between technical and financialtheir actions in ways that create (co-) benefitspartners. In certain situations technical or financialfor actors from the “other” field (e.g. financialassistance may simply not be possible (for certaincooperation) and vice versa.sectors or in general), e.g. if borrowing limits haveFormalised cooperation for joint projectbeen reached or if high-level social, economic andimplementation: Technical and financialenvironmental safeguards of development coopera-organisations explicitly team up and combinetion partners cannot be met by national institutions.their strengths to achieve scaled-up impact.This negatively affects potential for collaboration be-Technical support with funding fromtween technical and financial organisations. In somefinancial institutions: One organisation payssituations, national implementing partners may alsoanother to contribute specific expertise orbe sensitive to close collaboration between financialresources.and technical partners.Other forms and sub-forms of collaboration also exist.While many of the assessed case studies do not specif-Entry points for fostering partnershipsically focus on building climate resilience, challengesInterviews have also shown that project managers inand success factors shared by these projects and or-technical and financial organisations can potentiallyganisations can also be applied to collaborative effortsaddress these challenges in a number of ways:for resilience. Planning and standardisation to ease alignmentprocesses: While general tensions between pro-Challenges for technical-financial collaborationcedures and processes cannot simply be erased,Based on interviews with managers of the projects /certain action can be taken to ease the process oforganisations listed above, three kinds of challengesfinding together. Sufficient time should be plannedhave been identified that affect whether and how or-for project initiation to prevent (unforeseen) delaysganisations can work together practically:from negatively affecting joint interventions. A close Tensions between organisations’ requirements orrelationship with implementation partners, bothprocedures: Organisations have different require-physically and with regard to regular exchange, isments and procedures, e.g. with regard to partner-very important to achieve impacts together in sit-ship and funding modalities, project lead times, defi-uations where partners cannot control each other’snitions of “technical assistance / cooperation”, andactivities. Documenting achievements and learningcontrol mechanisms over the activities of potentialfrom previous experiences of other projects can al-partners. Partnerships will not form where theselow for “leap-frogging” challenges that have beenrequirements and procedures are incompatible orencountered previously.where making them compatible comes at high effortand cost. Maximising use of available structures and resources: Even if cooperation is not institutionalised, Lack of structures and resources for bottom-upoptions may exist to improve the use of availablecooperation: Even if collaboration between two orstructures and resources. Programme managers needmore organisations is generally possible and desired,to proactively search for collaboration with potentiala lack of structures and resources for bottom-uppartners that are active in similar fields, e.g. throughcooperation can negatively affect practical action.donor coordination groups. Potential benefits ofFor example, the lack of communication platformscooperation need to be identified and communi-and understanding of the potential partners’ needscated widely to increase motivation of all involvedand capacities can make it difficult to plan projectsstakeholders. Project teams should be built so as totogether. Additionally, the costs of partnership man-comprise motivated team members with comple-agement are often not matched by sufficient (timementary technical and financial skills. Continuousand financial) resources. Partnerships may thus onlylearning, e.g. through trainings, can help to familiar-8

WORKING PAPERise partners with each other’s specific requirementsfor partnership management, i.e. to assess synergies,or needs. Finally, practical solutions may exist forbuild strong teams and manage practical cooperation.certain problems. For example, if project managersHowever, whether or not these suggestions lead tofrom development finance institutions (DFI) lacksuccessful partnerships depends to a certain degreeresources for partnership management, technicalon timing and luck – given a certain coordination andpartners could cooperate with local consultants hiredharmonisation fatigue among donors, partnerships areby the DFI. Overall, personal motivation and willing-most likely to form in moments when objectives andness to “go the extra mile” for cooperation will alsoresources are relatively aligned. Building “coalitions ofplay an important role in managing partnershipsthe willing” can help where engagement with a widerwithout dedicated resources.group of potential partners is not successful. Working on framework conditions: Working on aYet, despite the existence of positive examples andsound policy framework and stable investment en-ideas from the field, the importance of collaborationvironment can help to increase demand for invest-(and of bearing the additional costs related to makingments in development and open up new opportuni-it work) actually still seems to be widely underesti-ties for technical support.mated. Discussions around collaboration mechanismsBeyond individual action, organisation- or pro-will thus have to be intensified and become moregramme-wide commitment and exchange withambitious, also with a view to successfully support-other donor organisations / programmes might helping NDC implementation at the country level. Newto make technical-financial collaboration more sys-technologies, organisational re-structuring and moretematic. If collaboration is supported by upper man-systematic (financial or non-financial) rewarding ofagement levels, project teams will have a strong drivercollaboration efforts might be required to bring insti-to overcome potential barriers. It could be helpful iftutions together more effectively. Overall, this paperorganisations screen their project portfolios for lessonsprovides first insights into a broad topic. More specificlearned on collaboration, and to communicate themand tailored research would be required to derive rec-among projects. Procedures, approaches or tools thatommendations for individual organisations.have successfully worked in individual projects couldbe standardised for use in other situations. Potentialsynergies could be systematically valuated whenever anew project is planned to highlight their contributionto an organisation’s or a programme’s overall objectives. Additional financial resources could be provided9

WORKING PAPER1INTRODUCTIONDevelopment in line with the Sustainable Develop-oration between technical and financial partners forment Goals (SDGs), the Paris Agreement, Nationallyprojects on the ground. The overall objectives of theDetermined Contributions (NDCs), National Adap-analysis aretation Plans (NAPs) and country- or sector -specific to contribute to the understanding of how technicalobjectives and frameworks is immensely challenging.and financial organisations work together practi-Many countries face a lack of capacity and financialcally to create joint impact;resources for designing and implementing respectivepolicies, programmes and projects.Development cooperation can contribute to addressing challenges and building climate resilience. to provide entry points for project managers anddonor organisations on how to increase collaborative action between technical and financial partners;andTechnical assistance (TA) helps countries design solu- to stimulate further consideration, discussion andtions for sustainable development and build capacity,in-depth analysis of the topic by project managersinstitutions and policy frameworks to implementand donors wishing to leverage synergies with otherthem. Financial assistance (FA) provides funding toactors of development cooperation.realise concrete (pilot) investments. Both aspects to-Even though relevant for most fields of developmentgether contribute to planning and conducting invest-cooperation, the report is meant to specifically in-ment projects. However, the globally-increasing num-form practitioners working on building climate re-ber of development partners and projects translatessilience through climate change mitigation and, ininto high management costs for recipient countries.particular, adaptation. This is based on the followingAt the same time, growing pressures, such as climateconsiderations:change, make it ever more important to ensure that Unprecedented challenges: Climate change is amongavailable resources are used in the most effective andthe most significant threats to sustainable develop-efficient way.ment. While climate change mitigation is requiredInternational efforts have been taken to strengthento avoid as many of the predicted negative impactsthe effectiveness of development cooperation andas possible, adaptation is highly important to secureharmonise activities between donors. Acknowledgingdevelopment outcomes against the unavoidableprevious and on-going discussions, this working paperrisks of climate change and to achieve many SDGs,seeks to shed light on examples of practical collab-e.g. related to health and jobs.10

WORKING PAPER Additional burden for countries with strained re-develop technically sound and bankable projects atsources: Addressing the unprecedented challengesthe speed and volume required to address climateof climate change requires additional technical andchange. Against this background, it is crucial tofinancial resources:make best use of synergies between technical and On the one hand, technical skills are necessaryfinancial dimensions of development cooperation into identify effective measures. Especially adap-order to maximise resilience impact of scarce publictation can be challenging. Since climate changeresources. Only concerted efforts will allow buildingimpacts and resulting vulnerabilities are verythe framework conditions and project pipelines re-location-specific, adaptation should be based onquired for an adequate response to climate changein-depth analysis of vulnerabilities as well as costsin line with increasingly ambitious NDCs. Moreover,and benefits of different adaptation options. Theefforts should also be aligned to stimulate privatedesign and financing of projects may thus requireinvestments.more in-depth technical expertise than other,The paper is based on desk research and interviewsmore standardised projects, such as in the field ofwith providers of technical and financial assistancerenewable energies.working in various fields, such as wastewater, forestry On the other hand, significant amounts of capitalor energy management. While many of them do notare required in the short- to medium-term to adaptspecifically focus on building climate resilience, chal-existing systems and infrastructures and to fosterlenges and success factors shared by these projectsinnovations for more resilient, climate-friendlyand organisations can also be applied to collaborativedevelopment. For example, according to UN En-efforts for resilience.vironment s Adaptation Finance Gap Report, USDFollowing the introduction, chapter 2 introduces140 billion to USD 300 billion annually may bedefinitions and actors of the international developmentrequired for adaptation in developing countriescooperation landscape. Chapter 3 illustrates differentalone by 2030, while the finance needs could reachforms of collaboration between technical and financialbetween USD 280 billion and USD 500 billion bypartners. Chapter 4 then discusses possible challeng-2050 (UNEP, 2016).es for collaborative action. Chapter 5 outlines initial Need for maximum impact and efficiency: Devel-entry points for project managers and donors to in-opment cooperation can contribute to building re-crease collaboration between technical and financialsilience and securing development outcomes againstpartners. Chapter 6 provides conclusions.the unavoidable risks of climate change. Financialassistance, for example, can be used to pay for theconstruction of more resilient infrastructures. However, many countries have insufficient local capacities and structures to access funding and to channelit to where it is most needed (Restle-Steinert et al.2019). Technical cooperation can help governments11

WORKING PAPER2OVERVIEW OF THE INTERNATIONALDEVELOPMENT COOPERATION LANDSCAPE2.1 Actors and activities in development cooperationInternational development cooperation comprisesuse. Sometimes they are applied interchangeably andboth technical and financial dimensions.sometimes they refer to different aspects of coopera-Many technical assistance (TA) programmes weretion for sustainable development (GSDRC 2009). Moreinitiated after World War II to foster economic develop-specific definitions depend on the organisations andment and reduce unemployment. In the 1990s, atten-countries applying them. However, it can be notedtion shifted towards human development and transferthat many development finance institutions provideof skills and knowledge systems (UN 2003). The Worldor pay for “technical assistance”, thereby meaning 1)Bank (WB), for example, defined TA as “the transfersupport for project preparation and implementationor adaptation of ideas, knowledge, practices, technolo-and 2) general institutional capacity building or policygies, or skills to foster economic development” (Worldadvice (e.g. Asian Development Bank (ADB), WB). OtherBank 1991). The term “technical cooperation” (TC) be-actors more commonly speak of “technical coopera-came

factors for collaboration between technical and financial partners in development cooperation. Berlin: adelphi. PUBLISHER adelphi research gemeinnützige GmbH Alt-Moabit 91 10559 Berlin P 49 (0)30-89 000 68-0 F 49 (0)30-89 000 68-10 [email protected]