Abstract
AbstractThe mobilization of effective private sector engagement is considered to be critical to address the adaptation challenge, but literature demonstrates that it has proven difficult. In the context of international climate finance, the focus has been on mobilizing private finance for adaptation and in addressing barriers that prevent investments from materializing. In contrast, this article identifies options to engage the private sector in adaptation beyond finance and focuses on market imperfections instead of barriers. This moves the focus away from simply mobilizing more private adaptation finance towards identifying market forces that innovate, engage, and direct investments towards adaptation. The Green Climate Fund (GCF) and its portfolio of 74 adaptation projects serve as a case study. Two of these projects are categorized as private sector projects and an additional nine mobilize private co-finance or non-financial private contributions. Beyond these two indicators, we demonstrate that an additional 60 projects engage the private sector in other ways, thus indicating the important broader role of the private sector in adaptation. Furthermore, our ordinal regression demonstrates that by addressing the market imperfections of positive externalities, imperfect financial markets, and incomplete and/or asymmetric information, all have a significant positive effect on private sector engagement in the GCF’s adaptation portfolio. Both findings indicate that there is a large potential for the GCF—and other climate finance providers—to increase private sector engagement in adaptation. It must be noted, however, that the mobilization of private sector engagement in adaptation is a means to an end, not an end in itself. The main aim should be to adapt society as a whole in an efficient manner, including the most vulnerable groups and people.
Funder
Bundesministerium für Wirtschaftliche Zusammenarbeit und Entwicklung
Publisher
Springer Science and Business Media LLC
Subject
Atmospheric Science,Global and Planetary Change
Reference59 articles.
1. ACT (2019) Learning brief: engaging the private sector in financing adaptation for climate change, s.l. Action on Climate Today
2. AfDB (2011) African development report 11: the role of the private sector in Africa's economic development. African Development Bank, Abidjan
3. Agrawala S, Carraro M, Kingsmill N, Lanzi E, Mullan M, Prudent-Richard G (2011) Private sector engagement in adaptation to climate change: approaches to managing climate risks
4. Ahenkan A, Osei J, Owusu EH (2018) Mainstreaming green economy: an assessment of private sector led initiatives in climate change adaptation in Ghana. Journal of Sustainable Development 11(2):77–87
5. Akerlof G (1970) The market for lemons: quality uncertainty and the market mechanism. Q J Econ 89:488–500
Cited by
16 articles.
订阅此论文施引文献
订阅此论文施引文献,注册后可以免费订阅5篇论文的施引文献,订阅后可以查看论文全部施引文献