Amid perennial floods, Philippines think tank chief calls for government to strengthen climate finance accounting for key projects

Funds from international donors might not have been properly tagged as ‘climate finance’, hence depriving infrastructure projects of their much-needed funding, says Institute for Climate and Sustainable Cities’ Kairos dela Cruz.

Typhoon Khanun floods Bulacan Philipppines
Knee-deep floods were seen along McArthur Highway in Balagtas, Bulacan due to heavy rains brought about by Typhoon Khanun which exited the Philippine area of responsiblity on 1 August. Image: Mark Mangandi/ Facebook

Editor’s note (29 Aug 2023): A previous version of the story had misquoted Kairos dela Cruz as saying that the Philippines government had not factored in climate in its key urban projects and that the neglect of biodiversity and mangroves protection had resulted in bad flood control in the archipelago. It stated that dela Cruz had made strong charges against government infrastructure projects amid an ongoing Senate investigation into widespread flooding in the country early this month. This is inaccurate and corrections have been made to the headline and article to accurately reflect what was said. We apologise for the mistake.

The lack of proper climate finance accounting mechanisms and poor budget tagging for projects could be the key reasons why the Philippines is now struggling to close its climate adaptation financing gap.

Amid perennial flooding in the archipelago, Kairos dela Cruz, executive director of Manila-based think tank Institute for Climate and Sustainable Cities (ICSC), told Eco-Business that the budgeting for key infrastructure projects – including what are perceived widely to be flood control projects – are now not designed such that they are able to tap on climate finance.

The gaps and lapses in the current finance reporting framework means that there is no strong assurance that funds from international donors are used on climate adaptation or mitigation, dela Cruz said, speaking on the sidelines of the World Clean Energy Conference in Manila.

A “larger part of the problem” also lies with how government agencies implementing key infrastructure projects that might help with flood control are not recognising their “climate change aspects”, hence depriving the projects from being properly tagged for receiving the necessary funds, he said. “It is a disservice especially to a climate-vulnerable country like the Philippines.”

Dela Cruz’s comments shine a spotlight on the importance of national public financial management processes, including the use of tools such as climate change financing frameworks and budget tagging, for countries to properly address climate adaptation financing gaps. In the Philippines, provinces in Central Luzon and Metro Manila were just hit by widespread flooding early this month after the onslaught of Typhoons Doksuri and Khanun.

A Senate investigation into the flood occurrences is ongoing. Their impact has been compared to Typhoon Ketsana that inundated four-fifths of the entire Metro Manila in 2009. The extreme weather event then is widely deemed as the most devastating cyclone to hit the Philippine capital in decades.

It is a disservice especially to a climate-vulnerable country like the Philippines.

Kairos dela Cruz, executive director, Institute for Climate and Sustainable Cities (ICSC)

Dela Cruz pointed to how the Philippine government has not been able to systematically channel external climate adaptation funding to flood control projects, even as it has been working on solving the flood issue for “a very long time”.

“What does it mean when [a project] is a flood control project? Does it just involve building higher roads or will it address the source of flooding, whether it is biodiversity decline, mangroves degradation or deforestation?…Right now, many projects do not have designs built in for them to qualify for climate funding. The definition is too loose,” he said.

“It is sad to think that for a country which commands such high respect internationally for finance, our systems are lacking.” For example, dela Cruz cited projects in Marinduque, an agricultural province in the southeastern part of Luzon, which should not immediately be assumed to be climate-related, even though they are widely known as flood control projects.

The Philippines is one of the world’s most disaster-prone countries. Located along the boundary of major tectonic plates and at the center of a typhoon belt, its islands are regularly impacted by floods, typhoons, landslides, earthquakes, volcanoes, and droughts.Since 1990, the country has faced 565 such disasters, killing 70,000 and costing US$23 billion in damages, based on data from the World Bank.

Dela Cruz also mentioned how the People’s Survival Fund – a relatively new grant facility for initiatives that will help Philippine communities deal with the impacts of climate change – can accept international donations.

This essentially means that as long as the government is able to properly account for what is tagged as climate finance, as a sovereign country, it can ask its bilateral partners to contribute to the fund, and local government units and accredited organisations on the frontlines would be able to use the funds and take action.

This year, the Philippines’ department of public works and highways has already earmarked US$3.2 million for flood control alone. An increase in funding has been proposed for next year, which will make it one of the biggest allotments of the 2024 national budget.

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