Measuring vulnerability to climate change for allocating funds for adaptation

The debates on the financing of the adaptation to climate change have so far not really addressed its allocation between developing countries. This chapter examines how the concessional funds for adaptation should be allocated. The principle proposed is the allocation of these funds to developing countries primarily according to their vulnerability to climate change, for which they are not responsible. This leads to a "Vulnerability Based Allocation” (VBA). To this end a physical vulnerability to climate change index (PVCCI) is proposed, as tentatively established by Ferdi: the index aggregates the physical impacts of climate change according to their main identifiable channels. The index is likely to be regularly updated. Its average level is given by group of countries (LDCs, SIDS, LICs,LMICs, etc). To determine the allocation of adaptation funds this index should be used in a simple formula which also includes per capita income, since the poorer they are the less resilient to climate change countries are . The choice of the parameters of the formula will transparently express the consensus of the international community about the principles of allocation of "adaptation credits" by country. A tentative simulation is proposed to show the relative share that each group of countries would receive (more than half for LDCs), and the ratio of the level of allocation per capita related to its average for developing countries (high for SIDS, as well as for LDCs). Adaptation credits could be used by countries via accredited financial institutions to which they would submit their adaptation programs or projects.