Finance for National Adaptation Plan Processes

The report examines the integration of finance within National Adaptation Plans (NAPs) across 59 developing countries. It finds that while most NAPs include dedicated finance sections and rely heavily on international public funding, there is a significant gap in detailed costing and the mobilization of private-sector finance. The authors recommend that countries move toward more investment-oriented NAP documents, implement climate-resilient fiscal planning, and adopt tailored financing strategies—particularly for Least Developed Countries (LDCs)—to bridge the adaptation finance gap.

• A majority of reviewed NAPs include dedicated sections on financing, and many refer to separate resource mobilization strategies to bridge funding gaps. Specifically, 50 out of 59 NAPs have a dedicated finance chapter, and 41 out of 59 refer to a separate financing or resource mobilization strategy.
• Costing adaptation remains a challenge, with only 37 of 59 NAPs providing cost estimates. Among these, 26 NAPs provide estimations for specific adaptation measures, 19 by sector, and 6 at the sub-national level.
• While all 59 reviewed countries mention public international finance, domestic resource mobilization is less specified. Only 31 NAPs specify national sources of funding, although 50 of 59 refer to integrating adaptation into national budgeting systems.
• Climate-resilient fiscal planning—where central finance agencies systematically manage fiscal exposure and mobilize funding—is rarely addressed, appearing in only 9 of the 59 NAPs.
• Private-sector finance is an underutilized resource, with only 2% of globally tracked adaptation finance coming from the private sector. Although 50 of 59 NAPs identify the private sector as a potential funding source, 44 of 59 emphasize the need for incentives like public-private partnerships and tax exemptions to attract this investment.
• Grants and loans are the most frequently mentioned financial instruments (30 and 28 NAPs respectively), while insurance is cited in 50 NAPs. Innovative instruments like debt-for-nature or debt-for-climate swaps are mentioned in only six NAPs each.
• Payment for ecosystem services is the most prominent instrument for ecosystem-based adaptation, referenced by 16 NAPs, including those of Ethiopia and Paraguay.
• Common barriers to unlocking finance include low awareness of funding sources, complex access procedures for international funds, and the difficulty of converting adaptation priorities into 'bankable' projects.
• Least Developed Countries (LDCs) face specific constraints, including narrow fiscal bases and high debt, making them heavily dependent on external aid. The report suggests a phased approach for LDCs, starting with institutional capacity building before attempting to attract private investment.

APA

Hernndez, M., Ledwell, C., & Yang, G. J. (2025). Finance for National Adaptation Plan Processes. NAP Global Network. https://napglobalnetwork.org/wp-content/uploads/2025/07/napgn-en-2025-finance-for-nap-processes.pdf

Chicago

Hernndez, Maribel, Christian Ledwell, and Geneva Juanyu Yang. Finance for National Adaptation Plan Processes. NAP Global Network, 2025. https://napglobalnetwork.org/wp-content/uploads/2025/07/napgn-en-2025-finance-for-nap-processes.pdf.

Wikipedia

{{cite report |last1=Hernndez |first1=Maribel |last2=Ledwell |first2=Christian |last3=Yang |first3=Geneva Juanyu |title=Finance for National Adaptation Plan Processes |publisher=NAP Global Network |date=June 2025 |url=https://napglobalnetwork.org/wp-content/uploads/2025/07/napgn-en-2025-finance-for-nap-processes.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{hernndez2025finance, author = {Hernndez, Maribel and Ledwell, Christian and Yang, Geneva Juanyu}, title = {{Finance for National Adaptation Plan Processes}}, institution = {NAP Global Network}, year = {2025}, month = jun, url = {https://napglobalnetwork.org/wp-content/uploads/2025/07/napgn-en-2025-finance-for-nap-processes.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }