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Janto Hess

Financing adaptation in Small Island Developing States: Investigating tourism related adaptation funds

Small Island Developing States (SIDS) are a group of low-lying coastal countries that are particularly susceptible to climate change impacts and share similar development constraints. In most SIDS, tourism is the main economic sector. Given the sector's vulnerability to climate change (e.g. rising sea levels or extreme weather events), high levels of investment in adaptation will be needed to maintain or increase visitor numbers. According to the current debate in international climate negotiations these financial burdens in developing countries should be partly shouldered by the private sector. This study investigates tourism sector specific adaptation funds as a possible measure to involve the tourism industry in adaptation finance in SIDS.

Overall, limited research has been done to investigate how the tourism sector can contribute to adaptation finance in SIDS. One previous explorative investigation suggested that local, national, or regional sector specific adaptation funds are a promising mechanism to involve the tourism industry in adaptation finance. Different stakeholders from the sector highlighted that such funds could provide a certain level of transparency, the tourism industry itself could be part of the managing board, and financial flows could be monitored. The sourcing of such a fund could come from the tourism industry, international climate finance (e.g. GCF), and the local government. The adaptation fund could, for example, finance dual-benefit adaptation measures (beneficial for the industry and the public) such as sea walls, water supply management, or early warning systems.