Bangladesh to slash its own climate adaptation fund

Source: Thomson Reuters Foundation - Wed, 18 Jun 2014 10:30 GMT

Author: Syful Islam

DHAKA, Bangladesh (Thomson Reuters Foundation) – Bangladesh plans to cut spending from its own budget on climate change adaptation and rely more in the future on funds from donors, government officials said.

The low-lying South Asian nation, considered one of the countries most at risk from climate impacts such as sea level rise, worsening erosion and erratic rainfall, has been a leader in the developing world in committing its own funds to climate adaptation. Officials allocated $320 million from the country’s budget over five years to a domestic climate adaptation fund, said Finance Minister A.M.A. Muhith in a budget speech to parliament.

But “this allocation will be reduced in the future and instead steps will be taken to increase (funding to) the Bangladesh Climate Change Resilience Fund, established with the assistance of our development partners,” Muhith said in a June 5 speech. That fund has so far received $187 million from international donors, with some of the money going to adaptation projects.

The minister proposed no new funding for the Bangladesh Climate Change Trust Fund (BCCTF), the country’s own adaptation funding initiative, in the next budget.

The change comes as part of an update to the Bangladesh Climate Change Strategy and Action Plan of 2009.

MISUSE OF FUNDS

Critics of the decision said the change in strategy comes in part because of questions raised about the alleged misuse of funds from the country’s adaptation trust fund, and the government’s desire to avoid further controversy in the future.

Last October, the Bangladesh chapter of Transparency International said it had found evidence of political influence, nepotism and corruption in the way funds were allocated.

“A significant amount of money had been allocated for the BCCTF in the last five years but the spending was poor. Besides, the way the fund was managed has raised questions for many, which led no fresh allocation in the new budget,” Shamsul Alam, a member of the Bangladesh’s Planning Commission, told the Thomson Reuters Foundation over telephone.

He said one advantage of relying on donor-funded climate adaptation projects it that they help transfer expertise and modern technology on adaptation, something Bangladesh in some cases lacks. “Capacity building of people on the ground is a must to adapt to climate change impacts,” he said.

Asked if donors might feel less willing to channel money to Bangladesh as a result of the government cutback in its own spending, he noted that in the new budget the government has imposed a “green tax” on industries that do not have a waste treatment plant.

That change “proves Bangladesh’s sincerity to climate change adaptation and keeping the environment free of pollution,” he said.

Atiq Rahman, executive director of Bangladesh Center for Advanced Studies (BCAS), told the Thomson Reuters Foundation in a telephone interview that Bangladesh still has a lot to do to adapt to climate change, particularly as it is so vulnerable.

He said the southern part of the country is particularly vulnerable, with 20 million people already lacking sufficient food, safe drinking water and sanitation systems. Drought-prone northern districts will also need large-scale climate adaptation programmes, he said.

DISCOURAGING DONORS?

Rahman said he thinks the government’s decision to cut its own spending on climate adaptation is the wrong one.

“The BCCTF should be kept well funded and replenished to encourage donors to pay more in the resilience fund. Unless you pay a portion on your own, why will donors feel interested to pay for your adaptation programmes?” he asked.

But greater transparency needs to be put in place in the spending of climate funds, to ensure the money goes to support people in the most need of help.

Hasan Mahmud, a member of parliament and Bangladesh’s former environment minister said adaptation projects costing less than $25 million will suffer the most if Bangladesh’s adaptation trust fund has no resources.

Donors for the most part only sponsor climate resilience projects larger than $25 million, he said in a telephone interview, but many of the projects Bangladesh needs most cost in the range of $5 million to $10 million.

“Big projects are not needed everywhere,” he said.

The government’s decision to create its own adaptation trust fund was highly praised by donor agencies and countries and a major encouragement for them to channel money to Bangladesh, he said.

“Donors felt (the depth of) Bangladesh’s seriousness about adaptation, despite not being responsible for climate change, following formation of the fund. Now the donors may get a wrong message and raise questions about whether we need any more adaptation funds since we have stopped spending from our own,” Mahmud warned.

Syful Islam is a journalist with the Financial Express newspaper in Bangladesh. He can be reached at: youths1990@yahoo.com

http://www.trust.org/item/20140618092711-072sy/?source=hpeditorial&siteVersion=mobile#

Bangladesh seeks export privileges to US on climate vulnerability grounds

Source: Thomson Reuters Foundation - Tue, 20 May 2014 06:45 AM

By Syful Islam

DHAKA, Bangladesh (Thomson Reuters Foundation) – Citing its increasing vulnerability to the impacts of climate change, Bangladesh has sought exemption from quotas and duty for all its exports to the United States.

US trade representatives have said they will consider the call for “duty free, quota free” privileges, according to Bangladesh’s commerce secretary, Mahbub Ahmed.

Such a rule change, if adopted, would make Bangladesh one of the first countries to receive duty reductions for “economic vulnerability” because of climate change.

Increased emissions of greenhouse gases are blamed for a rise in global temperatures which is causing climate change, sea-level rise and an increase in extreme weather events. Those are having increasingly serious effects on the economies of many low-lying countries, including Bangladesh, widely judged one of the world’s most vulnerable countries to climate change.

Bangladesh’s planning minister, Mustafa Kamal, claimed recently that the country loses $2.2 billion a year due to the impacts of climate change.

“We have sought duty- and quota-free market access of our apparel products to the U.S., taking into consideration Bangladesh’s vulnerability to climate change,” commerce secretary Ahmed told a press briefing after the first meeting of the Trade and Investment Cooperation Framework Agreement, a new bilateral forum, in Dhaka at the end of April.

Apparel accounts for nearly 78 percent of Bangladesh’s worldwide export earnings. The industry, worth $21 billion a year, employs around 3.6 million people directly, 80 percent of them women.

According to Ahmed, Michael Delaney, the assistant United States Trade Representative for South Asia, said that his country would take the issue under consideration in the future.

The United States is the world’s largest emitter of greenhouse gases, and Bangladesh is the second largest exporter of ready-made garments to the United States, after China.

Currently, Bangladesh is required to pay a 15.62 percent duty on these apparel products, a tariff which last year totalled $828 million.

By contrast, China pays just 3 percent duty, while other Asian competitors pay rates ranging from 2.29 percent for India to 8.38 percent for Vietnam.

Many Bangladeshi products, apart from garments, had duty-free access to the U.S. market until last June, when that status was suspended citing poor working conditions and lack of labour rights in Bangladeshi factories following the Rana Plaza disaster.

NEW ECONOMIC VULNERABILITY

Ahmed said that when Bangladesh mentioned the duty-free, quota-free access for apparel products enjoyed by sub-Saharan African and Caribbean countries since 2000, the US trade team responded that the economic vulnerability of those countries was a consideration in these cases.

“(So) we raised the issue of Bangladesh’s vulnerability to climate change as a counter logic to strengthen our demand,” he said.

In a phone interview, Ahmed said that developed countries have a non-binding commitment under World Trade Organisation provisions to offer duty-free access to all products from low-income countries.

The United States says it will wait until the conclusion of the Doha round of negotiations before taking a decision about duty-free, quota-free access to its markets for Bangladesh. Those negotiations have been largely stalled since 2008 over an impasse on agricultural imports.

Bangladesh, a low-lying country, has suffered in recent years from poor rainfall, droughts, and riverbank erosion made worse by rising sea levels, as well as an increasing number of natural disasters including cyclones, tornadoes and flash floods.

Communities in coastal areas are especially vulnerable to storms, and the frequent losses inflicted by them make it impossible for many to escape poverty.

“The intensity and frequency of disastrous events will increase day-by-day due to the impacts of climate change,” said Ainun Nishat, an environmentalist and vice-chancellor of Brac University in Dhaka.

“Poor people – especially women and children in (the) coastal belt – are major victims of the impacts which are increasing their suffering,” he added.

Nishat said that if the Bangladeshi government cites climate change vulnerability in order to get duty-free, quota-free access for its products in the United States or other developed nations, it must ensure that a portion of the saved money goes to the victims of climate change.

“As you are seeking the privilege citing the vulnerability to the climate change, spending a fraction of money for adaptation to the hazard is rational,” he said.

Syful Islam is a journalist with the Financial Express newspaper in Bangladesh. He can be reached at: youths1990@yahoo.com

http://www.trust.org/item/20140519102734-yuzqi/?source=spotlight