EastBengalPro
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Bangladesh, as an economy, has performed remarkably well in the recent decade. It has the potential to become one of the world's fastest growing and powerful economies in the coming years. The latest PricewaterhouseCoopers (PwC) report 'The Long View: How will the Global Economic Order Change by 2050' ranked Bangladesh 31 among the world's 32 largest economies in 2016. Besides, it predicts that consistent growth of Bangladesh will push Bangladesh up the ladder in the ranking of largest economy.
According to the PwC report, Bangladesh will secure 28th place in 2030 and 23th place in 2050 among the world's largest economies. Bangladesh has enormous challenges to overcome in order to reach the potential top positions. One of those challenges that will impede Bangladesh's expected growth level or precisely 'inclusive' growth is climate change.
According to the Climate Change Vulnerability Index (CCVI) 2015, Bangladesh is the most vulnerable country to climate change. Forty years of Bangladeshi history shows that natural disasters depress the country's GDP annually by 0.5 to 1.0 per cent. Climate change and global warming data of NASA depicts that the sea level rises by 3.4 millimetres per year with the increasing global temperature of 1.7 �F each year. Such climatic changes will make things more difficult for Bangladesh in near future by damaging the national security and hurting the economy's growth.
Adapting climate actions such as developing the resilience capacity of communities, building emergency cyclone shelters, enhancing the capacity of government agencies to respond to emergencies, intensifying river embankments and coastal polders, reducing saline water intrusion in agriculture-dependent areas, executing the early warning and emergency management systems, etc could be a possible way to avoid the worst impacts of climate change.
Bangladesh has been praised internationally in recent years for putting such adaptation strategies into operation effectively and being successful in minimizing the cost of damage incurred by natural calamities such as cyclones SIDR (2007) and AILA (2009).
Though Bangladesh has made considerable progress, dealing with climate issues has always been a challenge for Bangladesh. The diversity and universality of the problem will make the task trickier in future. The amount of financial and technical support received by Bangladesh will mainly determine how well it deals with climate impacts and their subsequent effects.
Bangladesh Climate Fiscal Framework 2014 shows that climate expenditure for Bangladesh varied from 1.0-1.4 per cent of GDP during the period FY2011-FY2014. The report also states that more than 80 per cent of climate-related projects or programmes were financed by domestic resources and about 19 per cent of financing came from external sources in FY2011-FY2014. One-third of the external financing comprised grants, and the remaining two-thirds were loans.
Again, top three ministries or divisions that spent more than 57 per cent of total resources allocated for climate activity were Ministry of Agriculture, Local Government Division and Ministry of Disaster Management.
Bangladesh Climate Change Trust Fund (BCCTF), Bangladesh Climate Change Resilience Fund (BCCRF), and the Pilot Program for Climate Resilience (PPCR) are the climate funds providing oxygen to the climate finance. Each of the funds aspires to finance the adaptation and resilience activities in Bangladesh.
The projected climate dimension budget, on average, was 4.1-4.2 per cent of GDP for FY2015-FY2017 (Bangladesh Climate Fiscal Framework, 2014), which is 2.8-3.2 percent higher than the climate expenditure for FY2011-FY2014.
Moreover, the remaining SDG period (2017-2030) may need an additional 2.4-2.5 per cent of GDP as climate expenditure and it indicates the growing demand for climate financing. Therefore, the existing supply of climate finance will not be sufficient in future. It requires having a realistic framework for climate financing. Thus, redefining the role of the contributors to climate financing will be crucial. Besides, new and innovative climate financing alternatives need to be explored in order to meet the intensifying demand.
Currently, the public sector is the biggest contributor to climate financing. In future, the private sector will need to come forward and contribute significantly. In addition, international partners will have to play a critical role in climate financing and NGOs will be the other potential contributor.
Public sector's main source of financing climate programmes is tax revenue. The current tax effort will need to be increased for meeting the challenge and will be important to enhance the efficiency level and expand the tax net.
The government can think of imposing a price on greenhouse gas emissions. Such internalization will generate revenue and make carbon emission expensive. Besides, domestic resource mobilization such as transferring resources from un-remunerative State-Owned Enterprises (SOEs) to profitable, SOEs will be another source of financing.
Since private sector will be the key actor, it needs to have a clearer guideline about the nature of financing of this sector. Corporate Social Responsibility (CSR) should be at the center of the financing system for the private sector and thus, it will be essential to have a well-timed law on CSR.
NGOs of Bangladesh have always played an important role in case of tackling climate issues and they will be a source of financing the skill-based training programmes and awareness programmes. Financing the climate programmes is a mammoth task and without international assistance, it will be tough to be victorious for a least developed country like Bangladesh. Enhanced support from global partners in the form of foreign aid and grants, concessionary loans and climate funds (i.e. Green Climate Fund) will be elemental here.
On the whole, the landscape of climate financing for Bangladesh demands contribution from both domestic resources and external resources. Moreover, existing options of financing will not be sufficient to accommodate the total demand and therefore, new and innovative alternatives for climate financing should be introduced.
http://www.observerbd.com/details.php?id=75898
According to the PwC report, Bangladesh will secure 28th place in 2030 and 23th place in 2050 among the world's largest economies. Bangladesh has enormous challenges to overcome in order to reach the potential top positions. One of those challenges that will impede Bangladesh's expected growth level or precisely 'inclusive' growth is climate change.
According to the Climate Change Vulnerability Index (CCVI) 2015, Bangladesh is the most vulnerable country to climate change. Forty years of Bangladeshi history shows that natural disasters depress the country's GDP annually by 0.5 to 1.0 per cent. Climate change and global warming data of NASA depicts that the sea level rises by 3.4 millimetres per year with the increasing global temperature of 1.7 �F each year. Such climatic changes will make things more difficult for Bangladesh in near future by damaging the national security and hurting the economy's growth.
Adapting climate actions such as developing the resilience capacity of communities, building emergency cyclone shelters, enhancing the capacity of government agencies to respond to emergencies, intensifying river embankments and coastal polders, reducing saline water intrusion in agriculture-dependent areas, executing the early warning and emergency management systems, etc could be a possible way to avoid the worst impacts of climate change.
Bangladesh has been praised internationally in recent years for putting such adaptation strategies into operation effectively and being successful in minimizing the cost of damage incurred by natural calamities such as cyclones SIDR (2007) and AILA (2009).
Though Bangladesh has made considerable progress, dealing with climate issues has always been a challenge for Bangladesh. The diversity and universality of the problem will make the task trickier in future. The amount of financial and technical support received by Bangladesh will mainly determine how well it deals with climate impacts and their subsequent effects.
Bangladesh Climate Fiscal Framework 2014 shows that climate expenditure for Bangladesh varied from 1.0-1.4 per cent of GDP during the period FY2011-FY2014. The report also states that more than 80 per cent of climate-related projects or programmes were financed by domestic resources and about 19 per cent of financing came from external sources in FY2011-FY2014. One-third of the external financing comprised grants, and the remaining two-thirds were loans.
Again, top three ministries or divisions that spent more than 57 per cent of total resources allocated for climate activity were Ministry of Agriculture, Local Government Division and Ministry of Disaster Management.
Bangladesh Climate Change Trust Fund (BCCTF), Bangladesh Climate Change Resilience Fund (BCCRF), and the Pilot Program for Climate Resilience (PPCR) are the climate funds providing oxygen to the climate finance. Each of the funds aspires to finance the adaptation and resilience activities in Bangladesh.
The projected climate dimension budget, on average, was 4.1-4.2 per cent of GDP for FY2015-FY2017 (Bangladesh Climate Fiscal Framework, 2014), which is 2.8-3.2 percent higher than the climate expenditure for FY2011-FY2014.
Moreover, the remaining SDG period (2017-2030) may need an additional 2.4-2.5 per cent of GDP as climate expenditure and it indicates the growing demand for climate financing. Therefore, the existing supply of climate finance will not be sufficient in future. It requires having a realistic framework for climate financing. Thus, redefining the role of the contributors to climate financing will be crucial. Besides, new and innovative climate financing alternatives need to be explored in order to meet the intensifying demand.
Currently, the public sector is the biggest contributor to climate financing. In future, the private sector will need to come forward and contribute significantly. In addition, international partners will have to play a critical role in climate financing and NGOs will be the other potential contributor.
Public sector's main source of financing climate programmes is tax revenue. The current tax effort will need to be increased for meeting the challenge and will be important to enhance the efficiency level and expand the tax net.
The government can think of imposing a price on greenhouse gas emissions. Such internalization will generate revenue and make carbon emission expensive. Besides, domestic resource mobilization such as transferring resources from un-remunerative State-Owned Enterprises (SOEs) to profitable, SOEs will be another source of financing.
Since private sector will be the key actor, it needs to have a clearer guideline about the nature of financing of this sector. Corporate Social Responsibility (CSR) should be at the center of the financing system for the private sector and thus, it will be essential to have a well-timed law on CSR.
NGOs of Bangladesh have always played an important role in case of tackling climate issues and they will be a source of financing the skill-based training programmes and awareness programmes. Financing the climate programmes is a mammoth task and without international assistance, it will be tough to be victorious for a least developed country like Bangladesh. Enhanced support from global partners in the form of foreign aid and grants, concessionary loans and climate funds (i.e. Green Climate Fund) will be elemental here.
On the whole, the landscape of climate financing for Bangladesh demands contribution from both domestic resources and external resources. Moreover, existing options of financing will not be sufficient to accommodate the total demand and therefore, new and innovative alternatives for climate financing should be introduced.
http://www.observerbd.com/details.php?id=75898
