Guideline – Assessing Climate Risks and Vulnerabilities in Market Systems

Helvetas has developed a Guideline – Assessing Climate Risks in Market Systems – to assess climate risks in a systemic way. The Guideline seeks to orientate and support practitioners by bringing in a climate risk perspective in market system development projects and identifying the most climate-resilient sub-sectors in a given context.

In its first hands-on applications in Nepal and Madagascar, the Guideline proved to effectively support the shift from reaction to proactively addressing climate variability and supporting changes in market systems. It also allows identifying new opportunities in a changing climate.

The Guideline in a nutshell

The Guideline helps (small-scale) businesses in better understanding climate risks and opportunities in their sub-sector, identifying emerging market opportunities and developing a comprehensive climate risk management approach for the enterprise. The overall objective of the Guideline is to identify the most climate-resilient sub-sectors in a given context and to determine potential impacts and relevant measures in the field of adaptation to climate change and disaster risk management to further increase resilience in the market system.

The Guideline combines two approaches: (i) the adaptation process and (ii) the market system development approach. The joint approach leads to a series of eight steps, structured according to MODULE A and MODULE B. In short, the Guideline is not a new tool, but builds on existing approaches (i.e. risk assessment tools such as the Community-based Risk Screening Tool, Adaptation & Livelihoods – CRiSTAL; the Climate, Environment Disaster Risk Integration Guidance – CEDRIG; and approaches related to market systems development).

8-STEP Approach Towards Climate Risk Resilient Sub-Sectors

© Helvetas
MODULE A launches an analysis of the wider and broader market system that contains a value chain, i.e. the core functions of a market system. This is then followed by a detailed risk assessment of current and potential hazards as well as an analysis of the different functions and their vulnerability to current and potential climate risks. 

With the support of MODULE B, the most appropriate measures for adapting to climate change and managing disaster risks will be identified, resulting in increased climate resilience of the sub-sector in a given context. For the final measures selected, the stakeholders jointly develop an Action Plan (Sustainability Matrix) defining each actor’s role and responsibility in the system (i.e. who will do it and who will pay for it).

In sum, the Guideline is an effective, simple, low-cost instrument for single use and/or comparative purposes. It helps practitioners to approach development issues systematically and to balance economic, social, political and ecological in a sustainable way. Hence it is an effective Policy Dialogue Instrument for development organizations facilitating such processes.

 

Experiences

The Guideline has been applied in various sub-sectors in Madagascar (cocoa and cotton jointly with Lima bean and Artemisia annua) and Nepal (coffee, banana, sweet oranges, walnuts, macadamia, medicinal and aromatic plants, riverbed vegetables and charcoal).
 
For instance, in the case of the coffee sub-sector in Nepal, the Action Plan reflects a good mixture of short-term and longer-term measures which require more incremental and transformative changes such as varietal research or a shift to higher altitude, implying that coffee production below 1,000 metres above sea level may no longer be appropriate in Nepal. Short-term measures such as intercropping, promotion of proper shade trees as well as moisture management were also identified. Based on these proposals different actors have initiated implementation of concrete measures as well as facilitated further discussions to prepare the farmers for these changing climatic conditions and hence to become more climate resilient.

If you have a story to share about using the Guideline in your context, please send it to us and we will upload it to this website with pleasure.

 

Concluding Remark

The numerous applications of the Guideline confirm that a sound understanding of the causes and effects of climate change is required to facilitate long-term viability of agricultural sub-sectors and to identify innovative and efficient adaptation and risk management solutions. In the case of Nepal, where various sub-sectors have been assessed, climate impacts vary from sub-sector to sub-sector within the same region. This confirms once more that there is no one size fits all approach when it comes to adaptation to climate change, and hence sound risk assessment is key to identifying future interventions. It also gives space for identifying good practices and measures that are suitable for scaling up new measures or assessing whether new strategies need to be included.

Last but not least, different actors have different stakes in the market system, but rely on each other’s performance. This requires all the actors to review their role, their possible contributions and their necessary actions towards concentrated efforts to climate change adaptation and risk management.

Further Information

For further information, please contact: 
ecc@helveas.org or nicole.clot@helvetas.org