11:15 AM to 12:15 PM (Asia/Kuala Lumpur)
Blended finance has emerged as an innovative funding approach to drive sustainable investment in local climate adaptation solutions across Asia.
In this session at the AVPN Global Conference 2023, learn from both the funders and impact organisations working in the field about how innovative funding approaches have enabled the implementation of community-driven approaches to climate adaptation. The discussion will touch on the landscape in Asia and why localised solutions are becoming increasingly important as the effects of climate change continue to be felt across the world. It will offer a deep dive on the intersection between climate and blended finance and how investors can identify opportunities that align with community-driven climate initiatives.
Moderator: Clint Bartlett, Consultant to the UN Development Programme (UNDP) and Global Resilience Partnership
Speakers:
- Charles (Chongguang) Yu, Climate Finance and Investment Specialist – Nature, Climate and Energy, UNDP
- Aneerudha Paul, Technical Consultant, Society for Promotion of Area Resource Center (SPARC)
- Dr. Dipayan Dey, Chair (Research & Planning), South Asian Forum for Environment (SAFE)
- Simon Field, Founder, Yayasan Besi Pae Indonesia
Key takeaways:
- Understand the role of blended finance for local climate adaptation solutions in Asia
- Hear from Asia-based impact organisations about how financing has enabled them to implement community-driven solutions
- Learn how to find opportunities for investment in community-based climate solutions
About the Adaptation Innovation Marketplace
Developed by UNDP, ICCCAD, the Adaptation Fund, European Union, Global Environment Facility, Global Resilience Partnership, and Climate-KIC, and launched by UNDP Administrator Achim Steiner in January 2021, the Adaptation Innovation Marketplace (AIM) is designed to accelerate innovative technologies, practices and business models for local adaptation by tapping into the incredible potential of NGOs, civil society, women, and young innovators. By empowering local actors, the platform contributes to the Principles for Locally Led Adaptation, as endorsed by UNDP and partners worldwide.
The AIM has different funding windows, one of which is the AF-EU-UNDP Innovation Small Grant Aggregator Platform (ISGAP). ISGAP counts with the financial contributions from the Adaptation Fund (US$5 million), anchored under their Adaptation Fund Climate Innovation Accelerator (AFCIA), and the EU (EUR 10 million). It is designed to develop and diffuse innovative adaptation practices, tools, and technologies that will result in improved climate resilience of vulnerable communities.
In early 2022, US$2.2 million in climate action grants were issued to 22 local innovators across 19 countries, and in early 2023, additional an US$2.5 million will be allocated to 23 further grants in an additional 13 countries.
Technical assistance from the network of UNDP and partners is provided to grantees to design a pathway to scale, either through public funding projects or through potential private funding channels brokered by UNDP and partners. One of the modalities explored by ISGAP is blended finance.
The role of blended finance in financing locally-led adaptation
There has been an increasing focus on the potential locally-led adaptation holds for our planet. Increasingly, local entities, including for-profits and NGOs, are recognised as best placed to grow the bottom rungs of local economic systems (in particular, civil society organisations often have social cohesion at their core and are strong holders and stewards of social and natural capital).
Yet, despite the vast amounts of private and public funds pledged towards the Global South, these entities often struggle to access finance to scale and grow.
Blended finance has held the promise of facilitating these funds through using cheaper-priced money (or zero-priced money, if philanthropy is used) to subsidise the risk of more expensive-priced money (such a banks, insurance firms, and other conventional funders).
However, to date, blended finance has not brought about the flow of finance as hoped, predominantly due to continued gaps between those that have capital, and those that need it; and between the mismatched expectations around financial return and societal impact.
The ISGAP project aims to fill this gap by specifically funding locally-led CSOs that bring about positive environmental and societal outcomes in measurable, scalable ways.
With many of the 40+ projects developing sustainable revenue models, ISGAP's aim is to both showcase the availability and “investability" of these types of projects, as well as present viable investments that can grow and scale in time, yielding appropriate financial and societal returns.
ISGAP achieves this through a combination of appropriately-priced funding to locally-led CSOs, underpinned by tailored technical assistance that focuses scaling and market development.