How Ministries of Finance can assess and manage physical climate risks and adaptation
Authors: Swenja Surminski and Daniela Baeza Breinbauer, with support from Hipolito Talbot-Wright, Nick Godfrey, Anika Heckwolf, Andy King (Flint Global), John Asafu Adjaye (African Centre for Economic Transformation) and Mads Libergren (Ministry of Finance of Denmark)
Ministries of Finance (MoFs) face an escalating need for public expenditure to deal with extreme climate shocks or chronic events, such as droughts and sea level rise, with physical impacts already putting economic development strategies and investments into the green transition at risk. This report reflects on the most pertinent physical risk and adaptation questions for MoFs and explores tools and methods to help those working on the core functions of public finance to understand the scale of the physical risk challenge today and in the future, including what this means for their different areas of responsibility.
This report is a product of the Helsinki Principle 4 (HP4) workstream of the Coalition of Finance Ministers for Climate Action (CFMCA), which is being led by Denmark’s Ministry of Finance with support from the Grantham Research Institute.