PIFS – 18 November 2020
Building hope, resilience and self-reliance for a thriving Blue Pacific future: momentum is building towards the launch of a Pacific Resilience Facility, and Samoa has offered to host its staff.
About the author: Dame Meg Taylor is the Secretary General of the Pacific Islands Forum.
Pacific people know resilience, for without it, we would not be here.
We have endured disasters on a recurring basis since the first navigators to this region explored and settled our sea of islands. Now, that endurance is being further tested as climate change exacerbates storms, flooding and other hazards that are harsher, more frequent and less predictable. Climate change impacts and natural disasters have destroyed lives and livelihoods across our Blue Pacific continent and has reset the clock on decades of hard-fought development gains in nation building.
Marginalised people in vulnerable communities have no doubt fared the worst. Women, children, the elderly and the disabled especially continue to be disproportionately affected. In 2015, Cyclone Pam left a trail of destruction in Vanuatu—with economic losses estimated at 64% of its gross domestic product. A generation of development gain, built up over decades of progress, was decimated in a matter of hours. In 2016, Cyclone Winston wreaked havoc in the Fiji Islands, with the resulting economic cost estimated at one third of the country’s gross domestic product. This phenomenon was repeated in Tonga in 2018, when Cyclone Gita caused untold destruction, with losses estimated at 38% of the country’s gross domestic product. The Pacific peoples are no doubt mindful of these acute vulnerabilities, having to live through these, time and again. The extremely high level of risk to Pacific societies is reaffirmed by the World Risk Report of 2019, which ranks six Pacific Island Countries among the twenty highest disaster risk prone countries, out of 180 states assessed worldwide.
The onset of the COVID-19 pandemic has not helped the situation in the Pacific either. To the contrary, the pandemic has laid bare and amplified our existing vulnerabilities as a region – superimposing a two-pronged health and economic crisis on economies in the Pacific, over and above the already existing existential threat, posed by climate change and natural disasters.
Recognising the vulnerabilities of Pacific Island Countries to climate change-induced disasters and associated economic shocks, Forum Leaders saw the need for an innovative financing mechanism to help the region access resources for building resilience and disaster preparedness. The need to invest in disaster risk reduction is strongly supported by global research which shows that every $1 invested in disaster preparedness saves up to $7 in recovery costs. In other words, it is more cost effective and sensible to be proactive and investing in disaster preparedness and climate proofing upfront than to spend resources on responding and rebuilding after disasters have struck.
Pacific Leaders realised that the Sustainable Development Goals (SDGs) would not be achieved if we do not implement effective climate change action and disaster risk reduction measures that directly improve the lives of our people and communities. Most importantly, Forum Leaders understood the importance of undertaking concrete and tangible steps where it matters most, and that is at the community level. Critically, the emphasis was to look at developing a self-sustaining financing mechanism where resources could be delivered in a quick and efficient manner to build resilience at community levels before disasters strike.
This call to action by the Leaders was in effect a deliberate undertaking to find a meaningful solution, to overcome the fact that most disaster risk financing support and products available to Pacific countries, tend to focus on post-disaster relief and recovery rather than focusing on resilience and disaster preparedness. While key global climate change funds such as the Green Climate Fund, the Adaptation Fund and the Global Environment Facility support resilience building and stronger adaptative ability prior to disaster events, the experience has been that the application process and the requirements necessary to access assistance under these facilities are prohibitively cumbersome, to the point that for many of us in the Pacific, the effort would be counterintuitive. Additionally, the scale of funding under these funds is also clearly well beyond the absorptive capacity of many small Pacific administrations and communities.
So, while the establishment of these funds may have been well-intentioned, the Pacific has not benefited in a meaningful way in this regard. The Leaders endorsement of the establishment of a facility, that is in essence, tailor-made to the peculiar circumstances and the needs of the Pacific communities, is an acknowledgment of the predicament.
As alluded to earlier, the work on the facility first began in 2017. The work was Member driven, and shaped by extensive consultations across the region, led by a Technical Working Group of Senior Finance Officials, under the leadership of the Secretary for Finance of the Cook Islands. By way of an update, the hard work by these Senior Officials, supported by the Secretariat has culminated in the design and development of the Pacific Resilience Facility (PRF), a Pacific owned, and Pacific led facility. It is intended to serve as, a unique and forward-looking approach that would allow the region to invest in upfront low-quantum and high impact community-level disaster preparedness projects. As such, it is similarly critical that the region has access to a predictable, and sustainable level of funding to address these risks. The focus of the PRF in this context in effect, represents the niche, or the climate financing gap, that matters most to Pacific communities.
To date, the work on developing the institutional arrangements for the facility has been completed, and the draft instrument is now being considered by Members for endorsement at the end of the year. A marketing prospectus intended to promote the facility at international pledging events has also been endorsed by the Forum Economic Ministers. Both instruments were subjected to stringent peer review both by domestic and international experts. Feed-back was incorporated as recommended. Additionally, the institutional arrangements were reviewed by the Audit and Risk Subcommittee, who likewise provided very useful feed-back on how to improve the arrangements, in order to safe-guard the Secretariat against risks.
The establishment of the PRF was endorsed by the Pacific Islands Forum Leaders in August 2019 in Funafuti, in a meeting chaired by Tuvalu. Pacific Leaders recognized the difference that the PRF could make in improving the quality of life for the people of the Pacific as they struggle to build back their communities in the face of unrelenting disasters and climate change impacts. From its very inception, the PRF has been fully owned, led, and driven by Pacific countries.
Looking ahead, the PRF fills a clear development niche and void. It will be the only self-sustaining Facility of its kind that is led by the region and focused on efforts at the community level – the heartland of our Pacific people. Once initial capitalisation has been achieved, we will have a regional resilience fund that will be able to generate its own resources to deliver small grants to vulnerable communities. A fundamental feature of the PRF is that – no debt will be created. The PRF is intended to help Pacific countries stand on their own feet with dignity, and respect for their sovereignty.
The PRF will empower and leverage national government systems to ensure aid effectiveness and full national ownership. The intent is that minimum resources are diverted to operational and administrative costs ensuring maximum funding is provided to vulnerable communities. Project grants will range from US$50,000 to US$200,000 range. The PRF will be agile and responsive, operating with transparency and accountability as its core operating principles.
In terms of governance arrangements, the region has clearly articulated its preference to be in the driver’s seat with full ownership resting with the region. At the same time, the management arrangements will be such that we will recruit the best and brightest as staff of the PRF, ensuring that we get value for money and deliver results for our Pacific people.
I commend the region and in particular the Ministers of Finance and Economy across the Forum on the work already done by my colleagues across the region to advance this unique and innovative financing mechanism. The next step is for us to continue to work together to capitalise the PRF though the mobilisation of resources from development partners and non-traditional funding sources, including philanthropic organisations. One key element of our strategy is to convene an international pledging conference for the PRF.
Indeed, through the PRF, the region looks to mobilise financing toward a climate resilient development pathway for our Blue Pacific continent. We call on the international community and our development partners to provide their strongest support for this home-grown and game changing resilience financing initiative and invite you to join and support us on this Blue Pacific journey.