The political economy of financing climate resilient development
IIED is undertaking a three-year research programme to understand the policy linkages between the two themes of climate change adaptation and mitigation in developing countries. This research focuses on countries that are investing in what has been termed 'low-carbon climate resilient development' (LCRD) – policies and strategies that address the challenges posed by climate change in an integrated response.
In recent years a number of countries have begun to develop and implement LCRD strategies in an effort to promote long-term national development in the context of a changing climate.
IIED is working with local researchers and 'action partners' in some of the countries that are leading the way in LCRD planning – Bangladesh, Ethiopia, Nepal and Rwanda – to support this transition to low-carbon resilient development.
Our research on LCRD uses an analytical approach known as political economy analysis (PEA). PEA is used widely in the social sciences to explore the underlying drivers and power structures that either enable or constrain the policy and planning process. Applying this approach to LCRD planning in Asia and Africa helps us understand how low-carbon and resilient agendas come together in practice, and how underlying discourses and knowledge shape policy responses.
The programme has three main aims: to build a body of evidence on LCRD public policy responses; to develop tools that can support these policy responses; and to promote forums for exchanging information and lessons based on different experiences in implementing national LCRD strategies.
What IIED is doing
The first year of IIED's political economy research programme focused on three projects:
- Understanding the underlying drivers that lead to low-carbon resilient development
- Exploring how sequential and synchronised climate policies lead to more effective LCRD policy responses, and
- Understanding the political economy of the Climate Investment Funds.
Through these three research projects, IIED has built a solid body of knowledge on the actors, knowledge, and supporting policies and resources that are needed to develop and implement LCRD policies in developing countries.
In the second year of the programme our research is building on this evidence, to focus on the financing of low carbon resilient development policies and plans. Specifically, this research is examining the actors, channels, and instruments that are being used to unlock LCRD finance, in order to understand whether the design of this financial delivery 'landscape' serves the needs of the poorest and most vulnerable.
Working with local researchers in each of our four partner countries, we are developing case studies to:
- Analyse financial intermediaries and the instruments they use to channel LCRD finance to the poor, and
- Examine how financial planning systems are incentivising LCRD and delivering it to the local level.
These case studies will culminate in cross-country learning dialogues to synthesise the experiences and lessons in financing LCRD.
The learning dialogues will provide researchers and policymakers with a platform to co-produce knowledge, learn from each other, and ultimately chart an effective way forward in improving the delivery of LCRD financing to the poor.
Financing inclusive low-carbon resilient development: the role of the Alternative Energy Promotion Centre in Nepal, Dave Steinbach, Sunil Acharya, Ramesh Prasad Bhushal, Raju Pandit Chhetri, Basanta Paudel, Krity Shrestha (2015), IIED Report
Financing inclusive low-carbon resilient development: role of Central Bank of Bangladesh and Infrastructure Development Company Limited, Neha Rai, Asif Iqbal, Antara Zareen, Tasfiq Mahmood, Maliha Muzammil, Saqib Huq, Noor Elahi (2015), IIED Report
Financing inclusive low-carbon resilient development: case studies of the Development Bank of Rwanda and the National Domestic Biogas Programme, John Rwirahira, Susannah Fisher (2015), IIED Report
Financing inclusive low-carbon climate resilient development: cross-country dialogue, Jony Mainaly (2015), IIED Report