Given the great need and limited resources available to support adaptation to climate change impacts, it is crucial that funds be deployed equitably and efficiently. While the Adaptation Fund has several innovative features and has made quick progress in starting to disburse funds, the extent to which its allocation criteria have been applied to date is unclear.

The Adaptation Fund’s record reflects the fact that while its mandate is to support countries that are “particularly vulnerable” to climate impacts, the Parties to the United Nations Framework Convention on Climate Change (UNFCCC) have failed to define that term. The Adaptation Fund Board has chosen not to come up with its own definition.

A review of the 48 proposals submitted as of June 2012, including 25 that were approved, shows countries with a wide range of socio-economic conditions and physical exposure to climate change have sought and obtained finance.

While all proposals are subject to technical reviews of project quality, there is no formal and transparent methodology for allocating funds between countries or between projects at the sub-national level. It is left to project proponents to define vulnerability and estimate the economic, environmental and social benefits of the project. As a result, the proposals take very different approaches and cannot be easily compared with one another. This undermines the pursuit of both equity and efficiency.

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