Making the Links Real: Connecting Development and Climate Action at the Country Level

2016 has opened a new chapter as countries focus on the specifics of implementing climate commitments and achieving the SDGs. Progress on sustainable development and climate change ultimately depends on how these agreements are translated into action on the ground in the years ahead in both developed and developing countries, and the extent to which they spur complementary and even more ambitious action beyond national governments: by businesses, financial institutions, civil society organizations and subnational governments.

Yet neither of these agendas is an island unto itself. Fostering coherence and synergy is a central challenge and opportunity as implementation gets underway. Indeed, the 2015 commitments on climate and SDGs provide the contours and direction for the same epochal project of systemic, societal change. Delivering on that will depend on countries embracing a new, more integrated approach to their future development.

While the rationale for tackling the synergies is clear, actually bringing climate action and development together in national implementation can be challenging. Delivering on either agenda taken on its own is a tall order for most governments, before even considering the inter-linkages between them and how these might be managed. And existing silos and entrenched perspectives stand in the way of integrated approaches to broader development and climate action. Also, making good on the promises of 2015 will be all the more challenging when the people who negotiated them are different from those responsible for their implementation.

To be sure, real progress has been made in recent years to integrate the climate and development agendas. Action to address the causes and consequences of climate change has been woven into the SDGs, as reflected in Goal 13 on climate action, and the inclusion of climate considerations in other goals and targets. Conversely, national climate commitments and plans are increasingly framed from a development perspective and at times embedded within economic and sectoral development plans that are key drivers of development.

The discourse is shifting towards integration, but the reality is lagging. What are the issues we need to grapple with? How can these two major agendas be brought together in ways that reinforce each other? And, most important, what has to happen within countries to make that possible, and how can international actors support that? Our aim with this commentary is to stimulate thinking and questioning about the key challenges and opportunities that lie ahead in moving towards more integrated approaches to climate action and development.

Interlocking Agendas

In the not too distant past, some development experts and commentators worried that to bring climate change or environmental sustainability to the heart of development would create unacceptable new risks – for instance, a dilution of the poverty focus in the Millennium Development Goals. Conversely, many in the climate change community worried that development could emphasize economic growth at the expense of long-term sustainability.

These fears are understandable, but miss the larger story – that climate and development are already fusing into a single challenge, because:

• the effect that climate impacts will have on development outcomes is substantial;
• dealing with climate change means transforming a range of key sectors that are also fundamental drivers of development, and
• development paths risk becoming dead-ends in the long term if they are not climate aware and environmentally sustainable, particularly if they lock in yesterday’s polluting technologies or development approaches hampers countries’ ability to seize the transformative opportunities of innovation.

Climate change cuts across all areas of development, but the overlap – and potential for synergies – is most pronounced in a few key sectors. Energy, transport, forests and industrial development are especially important for mitigation and low-carbon development, for example, while water management, health, disaster risk reduction and social protection clearly matter greatly for adaptation and building climate resilience. Meanwhile, other sectors, such as agriculture and rural development, infrastructure, and urban planning are crucial for both mitigation and adaptation.

That the climate and development agendas are causally linked and hence mutually interdependent is evident to many working at the frontline, e.g. in communities, cities and marketplaces. But the linkages have also become much more widely understood both internationally and in national decision-making in recent years, not least as a result of the extensive deliberations and consultations conducted over the past two years as part of the negotiations processes. The considerable synergies between both agendas is strongly reflected throughout the SDGs and 2030 Agenda as well as in the Nationally Determined Contributions (NDCs) that countries have put forward and that will take effect under the new climate agreement, particularly since so many of the NDCs have the same target date – 2030 – as the SDGs do.

The preamble of the SDG outcome document notes the fundamental impacts of climate change on development. References to climate resilience and adaptation are interlaced throughout several goals. And most important, Goal 13 on addressing climate change includes a target specifically on integrating climate change measures into national policies, strategies and planning. The big question is to what extent this integrated approach will be embedded in the national development plans that now need to be developed.

Meanwhile, WRI’s review of INDCs finds that many put forward by developing countries are explicitly framed through a development lens. This is the case with Kenya, which committed to integrate climate change action into land reforms and in the water sector by implementing the National Water Master Plan (2014). Likewise, national and regional development plans have been crucial assets in identifying climate opportunities that can maximize emission reductions and increase resilience while achieving key development outcomes for countries, as seen in both Ethiopia and Mexico’s INDCs. And of course, the climate actions set out in the all the INDCs speak, even if not explicitly, to many of the SDG targets.

Despite these signs of convergence, the realities of implementing development and climate objectives often remain largely separate in practice, pursued in parallel by bureaucratic agencies and professional communities that do not always communicate and often compete for funding and political attention. In many cases, the persistent fragmentation of knowledge and action continues to stand as an obstacle to success. And even where the synergies between the agendas are recognized and key actors want to seize them, identifying the concrete benefits of the linkages and taking advantage of them can remain a challenge.

We believe that bridging these divides is essential in translating these international agreements into effective national implementation. Much of this action will have to take place at the national level because that is where policy decisions that affect people’s lives and livelihoods are made. In both the climate and development realms, there has been a convergence on the need for universal approaches to address global challenges, with all countries taking action, and through country ownership, with actions rooted in national policies and politics even as part of a broader international framework. Yet this is not a challenge for national governments and stakeholders alone: complementary action is needed at the international level – in designing institutions, setting norms, building global partnerships – to support synergies and integrated solutions at the country level.

Six Key Challenges

In this commentary, we highlight six key challenges that will need to be tackled to build strong links between climate and sustainable development objectives when implementing the SDG and climate agreements. Addressing these challenges can often bring major opportunities on the ground in individual countries by connecting these two agendas.

1. Vision and Narrative

National leaders need to craft resonant political narratives around climate and development linkages that makes the complex practical, relates the new global agendas to concrete national aspirations and translates them into terms that policymakers across line ministries and local governments, business and citizens’ groups can understand and embrace.

These kinds of narratives need to be specific to national contexts, but there are likely to be some overarching similarities. A successful narrative would underscore inter-linkages, recognize that the two agendas are stronger together than they are apart, crystalize main strategic priorities at the intersection of climate protection and sustainable development, and make the case for an economic transformation to drive low-carbon development that leaves no one behind.

A starting point could be a narrative that emphasizes sustainable development – with climate action at its heart – as the common frame and destination for both agendas and that also underscores the opportunities that lie in unlocking sizeable synergies, e.g. in infrastructure development, forest management and food security, energy access and security. The commitment embedded in the SDGs to leave no one behind can serve as a good entry point. Such a narrative could recognize the enormous impacts that climate change has, and will continue to have, on development, while also grounding development and climate concerns in country-level priorities and highlighting synergies and opportunities in key sectors like agriculture, energy, transportation, employment, land-use, urbanization, and in the related areas of adaptation and resilient development.

To be effective, narratives must be nationally owned and developed with the support of policymakers, civil society groups, business, subnational governments, and local and community leaders, rallying diverse stakeholders around a common national sustainable development agenda that leaves no one behind. Such a narrative will need to be propagated at the top level of leadership to send effective signals enabling the pursuit of a linked climate and development agenda.

2. Integrated Plans, Policies and Strategies

If stabilizing our climate and achieving the SDGs represent one common destination, choices we make about how we grow and develop our economies and societies will ultimately determine if and how fast we get there. Embedded in the SDGs and the climate agreement – including the commitment to leave no one behind – is a transformation of our economies and societies. That in turn depends on effectively weaving climate and development objectives and concerns into national development planning and policy.

To date, most countries to have separated their development plans (e.g. national development plans and poverty reduction strategies) and climate plans (e.g. Nationally Appropriate Mitigation Actions (NAMAs), National Adaptation Programmes of Action (NAPAs), National Adaptation Plans (NAPs), and now NDCs), both of which are in turn divorced from economic decision-making. This method of planning perpetuates the fragmentation and competition between these two agendas and their stakeholders, preventing countries from genuinely engaging on how to align them both.

Looking ahead, there will be a premium on genuinely integrated planning that addresses both climate and development from the outset and integrates these into national economic development planning and policy, including annual budgets. National governments and their international partners will need to become adept at targeting double wins in key cross-over sectors – such as energy, industrial development, urban planning, disaster risk management, water management, agriculture, transport – to create a bottom-up engine of integration.

Doing this effectively will require new approaches to assess specific policies in terms of multiple outcomes such as economic inclusion, growth, local environmental benefits and greenhouse gas reductions. For example, how can transport policies be designed to maximize access to mobility, reduce emissions and make cities more livable? How can rural and agriculture planning protect forests and watersheds while increasing agricultural productivity? What fiscal policies can help achieve climate aims as they address the needs of lower-income citizens?

There are an increasing number of examples of integrated planning processes, such as Ethiopia’s Climate-Resilient Green Economy Strategy, which formed the basis for its NDC and is now being even further integrated into Ethiopia’s overarching national development strategy. Ethiopia’s long term strategy is to achieve middle-income status by 2025 based on carbon-neutral economic growth. But this approach is hardly widespread at this point, and there are still many lessons to be learned about how to do it well.

Countries will of course need to establish priorities. It may well be that in least developed countries with large populations exposed to preventable diseases, priority be given to interventions that can dramatically reduce the burden of these diseases. At the same time, where linkages are salient, climate knowledge and action may assist and in some cases offer more cost-effective solutions. For example, knowledge of how climate change generates new patterns of vulnerability to malaria can help target preventive interventions. In the same vein, improving public transport systems may yield considerable health co-benefits – through reduced road accidents and deaths, and reduced air pollution – while also increasing mobility for the poor if designed with their needs in mind.

3. Institutional Coherence

One of the primary barriers to successful alignment and subsequent implementation of climate and development planning is institutional fragmentation and a lack of coordination. In many countries, responsibility for climate change rests with specialized agencies (e.g. environmental and disaster risk reduction authorities), even though the mix of policy instruments needed typically extends well beyond what is in the toolkit or mandate of these specialized authorities.

Institutional fragmentation has a number of implications. It encourages inter-departmental competition for scarce resources and political attention. Key technical capacities are stretched across a number of agencies, and many governments are still unable to undertake the analysis, planning, coordination, monitoring and reporting required to formulate, implement and track climate actions. Incentives for collaboration, information and data-sharing are weak in both developed and developing countries, compounding capacity challenges as individual authorities lack access to relevant knowledge and technical capacities from other departments. This makes it increasingly difficult to achieve policy coherence, resulting in avoidable conflicts and trade-offs.

Addressing institutional responsibility and cross-sectoral engagement will thus be key to effectively develop integrated approaches. Coordination between policies in several sectors and at various scales is a fundamental challenge that must be tackled. For example, government ministries may need to come together around how social policies might complement mitigation policies in order to optimize benefits or neutralize any negative consequences from mitigation measures (e.g. fossil fuel subsidy reform coupled with social support mechanisms). Good institutional design can allow relevant actors to coordinate and collectively prioritize and implement actions. Examples of this in practice include:

• The Inter-ministerial Climate Change Commission in Colombia which brings together 15 ministries, is chaired by the National Planning Department with the Environment Ministry as the technical secretariat.
• In Ethiopia, the Climate-Resilient Green Economy Strategy was developed by a Ministerial Steering Committee led by the prime minister’s office and comprising the state ministers and senior officials from across government. Implementation is coordinated with the prime minister’s office and across several ministries and government agencies.
• In France, a national council on energy transition provides a platform for dialogue and coordination involving key ministries, as well as civil society organizations. The council aims to advance France’s energy transition and low-carbon strategy along with its broader sustainable development strategy. Taken together, these will support implementation of France's climate commitments, including its role in fulfilling the European Union’s NDC.
• In Gabon, responsibility for implementation of the 2014 Code for Sustainable Development lies with a National Sustainable Development Agency under the auspices of the Ministry for Economy, which has the lead for guiding the transition towards a low-carbon and sustainable economy. This Economic Ministry has also been involved in the definition of Gabon’s INDC. This country has committed to a decarbonization path voluntarily, through the publication of its Climate Plan and passage of its Law on Sustainable Development.
• Bangladesh’s Climate Change Trust Fund (BCCTF), is a leading example of effective cross-sectoral coordination at the national level. The Bangladesh Climate Change Resilience Fund has meanwhile improved coordination among finance providers.

Yet building linkages across governments and sectors can be difficult, and in many cases may create complexity or transaction costs that get in the way of taking effective action. Other key actors, such as parliament, continue to be highly segmented, which may hamper effective national monitoring, and budget allocations for integrated action. Additional exploration and research is need to in order to highlight best practices and pathways for countries to support alignment among sectors and between policy development, institutional design and legal frameworks.

4. A Whole-of-Society Approach

To succeed at the nexus of climate and sustainable development, an inclusive approach to governance and policy will be key. Efforts to bridge climate action and development ultimately need to be lucid to local context and clever about addressing local institutional constraints and market realities. A wide range of stakeholders – local entrepreneurs, community leaders, bankers, chieftains, unions, etc. – possess knowledge about interactions between climate action and sustainable development that are likely much greater than that of more distant policymakers. Across issues such as health, gender, urban planning, rural development and many others, those most directly involved in facing these challenges will often have the greatest insight into what needs to be done to tackle the climate and development nexus.

The SDGs include goals that highlight the importance of building this kind of engagement more generally, not only for climate action. Goal 16 emphasizes “build[ing] effective, accountable, and inclusive institutions at all levels,” while Goal 10 underscores the need to “empower and promote the social, economic and political inclusion of all …” Indeed, unless a wide range of actors is engaged, policies will fall short by failing to benefit from the keen understanding these actors can bring. Open and transparent consultations and empowering key stakeholders is all the more important to enable these actors to contribute and own the approaches being developed. Given the characteristically long time horizons for decisions relevant to climate action and sustainable development, effective public engagement is needed to ensure the legitimacy and durability of these policy decisions.

Alongside civil society and local communities, private sector actors, including small and medium size enterprises, can offer critical insights. Businesses are often faced directly with the intertwined nature of climate and development, such as when they must deal with the implications of water scarcity or when they seek out energy efficient solutions to help cut costs.
Building the participation of a wide range of stakeholders is therefore an essential challenge for developing solutions at the climate-development nexus. Developing inclusive modes of engagement from the start that involve the poorest and most vulnerable, including women and ethnic minorities, is an essential component of this whole-of-society approach.

Engaging widely across society will require governments to operate in two dimensions that can be mutually reinforcing. One will be to create effective processes to engage and promote participation by civil society horizontally across sectors and types of actors, such as those involved in gender issues or health. The other is to engage vertically by developing processes to promote participation and involvement by actors at all levels.

5. Finance

For both the climate and development agendas, the investment and financing needed will be several orders of magnitude larger than what flows through ODA and current international climate finance mechanisms. Broader shifts in investment and finance – from both public and private sources – will be paramount to success, as will be finding ways to ensure that resources are put to best use for a low-carbon, resilient future with a particular focus on the poorest and most vulnerable.

The SDGs and Addis Ababa Action Agenda reflect a new global consensus to shift investments from a high-carbon to a low-carbon inclusive and resilient economy. To date, however, international frameworks for financing frequently continue to treat climate and development as distinct. Moreover, many climate-related investments – including natural ecosystems protection and the incremental costs of climate-friendly technologies -- have too often been viewed as irrelevant or even constraints to growth and development, rather than as opening up new opportunities if done smartly.

A fresh approach to climate and development finance will be essential to building trust in cooperation between the climate and development arena, and to ensuring limited public financial resources are coherently deployed to effectively catalyze larger flows of finance. This should focus relentlessly on targeting investment where it will generate the best results, ensuring that streams of climate and development finance complement and reinforce one another rather than compete in a zero-sum dynamic, and pursuing climate and development benefits in tandem through a sustainable development frame. Central to this approach is to find the sweet spots where limited public investments can have the greatest benefit across climate and sustainable development objectives. These sweet spots are many and often more sizable than previously recognized: indeed, there is growing evidence and recognition among leading economists that previous cost-benefit analyses may have grossly underestimated the co-benefits of climate action (See OECD ((2010)) The Benefits of Climate Change Policies. The economic benefits of climate action are also investigated in depth by the Global Commission on the Economy and Climate.

There are great opportunities in unlocking synergies in infrastructure development, forest management, and energy access, for example. Close to one quarter of all ODA currently goes to sectors that are highly relevant to climate change in the sense of being climate sensitive or offering sizable mitigation opportunities: $11.4 billion of total ODA in 2011 was for the energy sector, $10.7 billion for agriculture and $12.6 billion for transport. If aid spending on those sectors supports climate as well as poverty objectives, then there is the potential for a double win; if not, then the opportunity to achieve multiple objectives is lost or, even worse, one set of funds could risk being used in ways that undermine the objectives supported through another.

Of course, where climate benefits require additional funding (such as with some renewable energy options), incremental finance will be needed to achieve those climate-related objectives. Often what is most needed is finance for up-front investment so that initial capital costs can be borne in order to tap longer-term cost savings and economic benefits. The financing challenge goes beyond the need for more money. It is equally as important to put in place the incentives (e.g. fiscal policies and regulatory frameworks) to direct capital and financial flows in ways that better serve sustainable and climate-compatible development at the same time.

Tapping opportunities at the climate and development nexus will present some important challenges, however. It will be essential to ensure that funding for climate purposes, including those closely linked to development aims, aligns with and does not diminish needed funding for development purposes such as education or health. Financial reporting to provide this assurance is also needed. Detailed tracking and reporting of finance will also be necessary to make sure synergies between climate and development are effectively captured. This in turn guards against missing opportunities to support development with climate funds and vice versa.

Where trade-offs do exist, they are likely to weaken over time. The steady decline in the cost of low-carbon technologies means that the pursuit of climate aims is often highly consistent with other development goals and even a key driver for economic development in many instances. According to the estimates of the New Climate Economic Report, investing in low-carbon infrastructure now will only imply an incremental cost of 5 percent, which would largely be offset over time as a result of lower operating costs, before taking into account the considerable savings that are likely to ensue, for example, from reduced air pollution. IRENA’s 2014 report on renewable power generation costs also shows that renewables have reached parity or dropped below the cost of fossil fuels in many regions as solar PV module costs have fallen 75 percent since 2009. The IEA has indicated that off-grid renewable generation will be fundamentally necessary to expanding energy access, so this price trend represents a critical opportunity to provide energy access to the 1.3 billion people who still don’t have it.

It will also be important to ensure that arguments for leveraging private sector finance do not serve to reduce support for activities that depend on public finance. Businesses are often less interested in opportunities in low income countries (which receive just 2.5 percent of foreign direct investment to developing countries), and many efforts – such as those involving small-scale agriculture or disaster preparedness – are unattractive short-term private-sector investments. As a result, a key challenge will be steering conditional grant finance where it is most needed.

The financing challenge goes much further than finding more money or deploying existing public finance more effectively. Arguably more important will be to put in place the incentives (e.g. fiscal policies and regulatory frameworks) to direct capital and financial flows in ways that better serve sustainable and climate-compatible development at the same time. Ultimately, what will prove decisive is whether trillions in global savings and investment can be mobilized to accelerate sustainable development progress at the climate and development nexus. This goes beyond talk of instruments and mechanisms; it is about transforming finance and the policy environment at a systemic level, so that investment will gravitate towards sustainable and climate-compatible development.

6. Monitoring and Reporting

Monitoring and reporting are essential to progress in implementing both climate action under the Paris Agreement and sustainable development under the 2030 Agenda. In addition to the benefits of improved tracking and monitoring in each realm, monitoring progress and sharing information can also play a key role in enabling better understanding and assessment of the interplay between climate action and sustainable development. Aligning and even linking the ways in which monitoring and reporting are undertaken for climate action and sustainable development can be critical tools to link the two agendas more broadly.

The aim should be to develop ways to help determine whether climate-related policies are providing development benefits and what the climate-relevant effects of sustainable development policies are (though we hesitate to so neatly divide the two into specific policy types). Doing this can assist in determining whether the synergies between the two are maximized, and whether there are tradeoffs that must be addressed. For example, are transport policies aimed at reducing emissions also providing health and mobility benefits or increasing resilience? How much are health policies tackling shifts in diseases due to climate change, or taking on board the local health effects of emissions? But silos may also need to be broken completely. For instance, the outcomes of a specific policy for energy access can be measured and reported against both development and climate objectives.

There are a number of substantial challenges in linking the monitoring and reporting of climate action and sustainable development. The monitoring and reporting systems for each agenda are distinct and frequently undertaken by different institutions. The Measurement, Reporting and Verification (MRV) system under the UNFCCC and the indicators adopted for the SDGs rely on different sets of metrics and other monitoring criteria. This results in communities of practice and knowledge for each area often being very distinct, with different approaches for assessing progress.

For tracking and reporting of the SDGs, this is a concern not only for intersections with climate action but also among the goals themselves. The 17 goals include a range of critical issues addressed by quite different constituencies and communities of practice and knowledge. These kinds of disconnects underlie broader policy incoherence within countries and internationally. One option may be to integrate indicators and metrics related to each arena into the other’s tracking and reporting system. For example, the framework for the UNFCCC’s transparency approach, which will be further elaborated based on the Paris outcomes, could integrate key factors and metrics having to do with the SDGs, such as energy access, sustainable land use and sustainable buildings. Countries could incorporate these dimensions when reporting on their climate policies and outcomes in their National Communications and Biennial Reports/Update Reports.

Similarly, the indicators for progress on the Sustainable Development Goals can integrate climate objectives. Indicators for Goal 13 of the SDGs on climate action are an essential starting point. Indicators on integrating climate action across sectors are of particular relevance to linking climate and sustainable development objectives. For instance, how are indicators for agriculture being formulated to address possible impacts of climate change on agricultural productivity and resilience?

It may also be necessary to develop a more fully linked approach to climate and sustainable development linkages. For example, can individual countries align their tracking for clean energy with greenhouse gas emissions targets and policies expressed in the commitments they make as part of the Paris Agreement? A country with an emissions reduction commitment to be reached by 2030 may develop a policy and target on clean energy access in line with that emissions goal – and then track both energy access and emissions in tandem.

Finally, the data revolution creates important new opportunities for data collation across climate, sustainability, and development – in effect, tracking the whole of the sustainable development agenda rather than different aspects of it in piecemeal fashion. Recent advances in information and communications technology open up exciting opportunities for radical forms of transparency and accountability. The revolution in big data, fueled by new information technologies and growing commitment to transparency by many governments and others, can provide crucial tools for building understanding of the links between climate and development, while also driving improved integration, coherence, and accountability for policy implementation.

From Commitment to Implementation

Tackling these six challenges for integrating climate and development action in countries won’t be easy. But it’s clear that success will depend on being clear-eyed about the challenges, while also being open to the opportunities that the world can seize if the synergies between these all too often separate arenas are seized. More to the point, failing to recognize and act on the ways in which climate change and sustainable development are intertwined will almost certainly undermine progress on both.

In laying out these challenges, we hope to advance the dialogue about what needs to happen going forward as countries pivot from commitment to implementation. It is only through accelerating the smart synergies and integrated approaches between climate action and sustainable development that we can deliver the transformation that beckons and fulfil the promises of 2015.