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Viet Nam experience with CPEIR and climate change finance tracking


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High-level inter-ministerial workshop held in Hanoi June 6-7, 2017 hosted by the Ministry of Agricultural Development (MARD) of Viet Nam and supported under the Integrating Agriculture in National Adaptation Plans (NAP-Ag) Programme. The meeting was attended by over 75 national and provincial level government officials, including MONRE, MARD, MPI and the Ministry of Finance (MOF), UN and development partners, private sector representatives including insurance companies, as well as non-governmental organisations.

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Viet Nam experience with CPEIR and climate change finance tracking

  1. 1. Vietnam Experience with CPEIR & CC finance tracking Glenn S. Hodes Climate Policy & Finance Specialist UNDP Bangkok Regional Hub Hanoi, 6 June 2017
  2. 2. • Governments are increasingly planning and implementing action plans linked to their national CC policies & the Paris Agreement. • There is often a large disconnect between these and realistic financing --> creates an implementation gap. • Decision-support tools can help track and prioritize resources • While climate finance (both int’l and domestic) is expected to increase, demand is likely to far outstrip supply. • Better management of climate spending is strongly correlated to more equitable, responsive actions to address the vulnerable • Viet Nam can pioneer efforts to base its NDC and NAP on evidence of financing gaps and analysis of the effectiveness of budget allocations to promote resliency Context:
  3. 3. More effective climate budgeting • What gets monitored gets managed • Budgets are how CC funds are often utilized and are the most important documents to translate policy into action • National (and local) budgets are critical for the implementation of adaptation plans and objectives, including NAPs • Contributes to better understanding of the economics of various options and CCA measures through better costing & prioritizing. • Better management strongly correlates to more equitable and gender-responsive spending
  4. 4. What is adequate spending? • The Government of Vietnam’s Target Program on Climate Change and Green Growth estimates that Vietnam needs to spend (between 2016-2020): – 4-6% of GDP for CC adaptation – US$ 30 billion for GG promotion (approximately US$ 9 billion from State budget) • ADB analysis (2009) concluded that to reduce CC related losses, 0.2% of GDP needs to be invested in CC adaptation, mitigation and adaptation investment of 0.5-1.5% of GDP offer a better scenario for the national response to CC. World Bank similar estimation of 4-6% of GDP. • 2015 CPEIR found 18% of total expenditure was CC relevant equivalent to 0.1% of GDP 4
  5. 5. Vietnam CPEIR – Key results 5 Total annual expenditures for Climate Change Adaptation by key Ministries (2010-2015)
  6. 6. Viet Nam: DISASTER RISK MANAGEMENT PUBLIC EXPENDITURE REVIEW DRM-PER is based on dataset of 2015 Climate Change Public Expenditure and Investment Review (CPEIR) • 5 Ministries: MARD, MONRE, MOIT, MOT, MOC • 3 Provinces: An Giang, Quang Nam, Bac Ninh • Data type: Recurrent and investment expenditure • Time period: 2010 – 2013 PLUS: MARD Investment expenditure 2010–15 6
  7. 7. Some key findings • DRM relevant expenditure was equivalent to 0.2% of GDP, 8.9% of central government budget, and 22.3% of combined budget of central government and 3 provinces. • Similar to Thailand and Lao PDR, agriculture ministry accounted for the highest proportion of budget relevant to DRM. In Vietnam, MARD accounted for 39.4% of all DRM-relevant expenditure 7
  8. 8. KEY FINDINGS Among 5 ministries, MARD had the highest number of DRM/DRR related projects as this ministry is the focal point in dealing with natural disasters 863 416 170 26 1 0 100 200 300 400 500 600 700 800 900 1000 MARD MONRE MOT MOIT MOC Number of projects Filter 1 • Identify DRM/DRR related projects
  9. 9. “Key word approach to filtering” • Capacity, protection, warning, safety, safe • Prevention, mitigation, response, emergency, recovery, rehabilitation, reconstruction • Disaster, flood, inundation, storm, surge, salt, salinity, earthquake, landslide, landslip, tsunami, tide/tidal, fog • Forest/Forestry, irrigation, water resoures management, hydo- meteorology/Hydology/Hydrological, Meteorology/Meteorological • Dyke, embankment, dam, weir, sluice, canal, harbor, bridge
  10. 10. DRM Relevancy as Share of Spending 10 0% 0% 0% 16% 84% MOIT 18% 8% 68% 6% 0% MONRE 18% 0% 24% 0% 58% MOT Very High High Mid Low Minor 0% 100% MOC Filter 2 • Identify degree of DRM/DRR relevance 25% 51% 13% 10% 1% MARD
  11. 11. Some lessons & key recommendations • Tracking and tagging finance is important for advocacy • Options for annual disaster relief funds allocations to contribute to preparedness in ‘good’ years • Linking DRM and CCA makes sense in creating an enabling environment for investment • Mainstreaming into national, sectoral, provincial plans ensures funding is available when required • Development of a budget tagging system for DRM and CC expenditure within national FMIS
  12. 12. • Nepal: CC Budget Code implemented following a National Process which led to a Multi-Sectoral consensus (2012). Revised high-level criteria used to set budget ceilings by National Planning Commission to give more priority to capital investment proposals that integrate CC & DRM risk management. • Bangladesh: CCFF (2014) recommends integration of CC into the Budget and Accounting System similar to what was done in gender and poverty. • Indonesia: Ministerial Decree (No.136/2014) introduces Budget Tagging for CC Mitigation system mandatory for seven key line ministries under the RAN-GRK. • Philippines: developed a common typology and guidelines for tagging CC spending in the budget. CCC able to take stock of and monitor the national climate response based on tagged data submissions for four fiscal years. CC Mainstreaming in Budget Examples in Asia 12
  13. 13. climate budget coding and tagging systems
  14. 14. Climate Change Financing Frameworks
  15. 15. • An integrated, strategic framework to better mobilize, manage and target climate finance so as to bridge existing finance and policy implementation gaps. • Outlines a reforms road map to enhance fiscal planning and budget management by systematically integrating CC and improving inter-ministerial coordination. • Supports decision-makers to strengthen capacity of country systems to deliver climate finance in a more effective, equitable, and accountable way. • Recognizes broad range of funding modalities, sources and uses that comprise a integrated financing plan. What is a CC Financing Framework (CCFF) ? Download NOW at
  16. 16. “Integrating Agriculture into NAPs” Results & Plans • THAILAND – Upgrading sector CC policy & Action Plan, links to operational planning & budgeting – Strengthening project design procedures and appraisal processes to integrate CC risk into internal project guidelines – Costing and developed more bankable programme proposals based on MCA & CC-CBA. • VIETNAM – Work with selected Mekong Delta provinces on CPEIRs and prioritized investment programmes in water supply linked to target programe and Decision 593 scheme • NEPAL – Appraisal of key sector CCA measures in partnership with GCF Readiness Programme – Enhancing project preparation guidelines and CC budget coding, expenditure tracking capacities in MoAD, MoLD 16
  17. 17. Sector Plans Reflect CCA & Policy Targets/Guidance Local Vulnerability Assessments, Adaptation Plans & Budgets Adaptation projects costed & prioritized National Adaptation Plan Implementing adaptation practices Monitoring CCA & DRR interventions Target resources to priority effective measures UNDP Model for National Planning & Budgeting Process & NAP entry points National Development Plans & Budget/MTEF Sector Plans & Guidance Sub-National Plans & Budget Allocations Project Formulation Guidance & Practice Program/Project Implementation Monitoring, Reporting & Evaluation Sector Performance Review & Impact Evaluation