BROKEN CONNECTIONS AND SYSTEMIC BARRIERS: OVERCOMING THE CHALLENGE OF THE "MISSING MIDDLE" IN ADAPTATION FINANCE

The document identifies a "missing middle" in climate finance—a systemic gap where mobilized funds fail to reach local and subnational actors due to bureaucratic barriers, capacity constraints, and a preference for international intermediaries. It argues that the direct access modality is a critical tool for overcoming this gap by empowering national and subnational entities. The authors highlight that while the AF has pioneered direct access, the GCF remains dominated by Multilateral Implementing Entities (MIEs), with only 16% of approved funding channeled through Direct Access Entities (DAEs) as of March 2019. The paper recommends shifting toward a principle of subsidiarity, increasing grant-based financing, and holding MIEs accountable for transferring capacity to national institutions.

• The "missing middle" is defined as a systemic gap in the climate finance architecture that prevents funds from reaching their intended local beneficiaries, primarily due to the failure to engage and resource national and subnational actors.
• There is a significant imbalance in the Green Climate Fund (GCF) between international and national access; as of March 2019, 84% of approved support (USD 4.2 billion) flowed through international entities, while only 16% (USD 836.3 million) went to Direct Access Entities (DAEs).
• Direct access is a transformative tool that increases national agency and reduces transaction costs, but African institutions face high barriers to accreditation, including complex bureaucratic processes and a requirement for documentation in English.
• Multilateral Implementing Entities (MIEs) often dominate the finance landscape and may sideline National Designated Authorities (NDAs), sometimes prioritizing their own institutional interests or project fees over the long-term capacity building of national actors.
• The GCF's co-financing requirements disadvantage DAEs, which are typically government bodies rather than financial institutions, by failing to recognize non-financial or in-kind contributions from local communities.
• A false dichotomy exists between 'climate change adaptation' and 'development,' where the requirement for a strict 'climate rationale' and 'incremental cost' calculations can hinder the implementation of projects that address immediate, interwoven vulnerabilities.
• Adaptation finance is chronically underfunded compared to mitigation; public climate finance for adaptation constituted only 20–25% of overall public funding from developed to developing countries according to recent reports.

APA

Omari-Motsumi, K., Barnett, M., & Schalatek, L. (2019). BROKEN CONNECTIONS AND SYSTEMIC BARRIERS: OVERCOMING THE CHALLENGE OF THE "MISSING MIDDLE" IN ADAPTATION FINANCE. World Resources Institute. https://files.wri.org/s3fs-public/uploads/Missing_Middle_Adaptation_Finance_-_Global_Commission_on_Adaptation.pdf

Chicago

Omari-Motsumi, Kulthoum, Mandy Barnett, and Liane Schalatek. BROKEN CONNECTIONS AND SYSTEMIC BARRIERS: OVERCOMING THE CHALLENGE OF THE "MISSING MIDDLE" IN ADAPTATION FINANCE. World Resources Institute, 2019. https://files.wri.org/s3fs-public/uploads/Missing_Middle_Adaptation_Finance_-_Global_Commission_on_Adaptation.pdf.

Wikipedia

{{cite report |last1=Omari-Motsumi |first1=Kulthoum |last2=Barnett |first2=Mandy |last3=Schalatek |first3=Liane |title=BROKEN CONNECTIONS AND SYSTEMIC BARRIERS: OVERCOMING THE CHALLENGE OF THE "MISSING MIDDLE" IN ADAPTATION FINANCE |publisher=World Resources Institute |date=2019 |url=https://files.wri.org/s3fs-public/uploads/Missing_Middle_Adaptation_Finance_-_Global_Commission_on_Adaptation.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{omarimotsumi2019broken, author = {Omari-Motsumi, Kulthoum and Barnett, Mandy and Schalatek, Liane}, title = {{BROKEN CONNECTIONS AND SYSTEMIC BARRIERS: OVERCOMING THE CHALLENGE OF THE "MISSING MIDDLE" IN ADAPTATION FINANCE}}, institution = {World Resources Institute}, year = {2019}, url = {https://files.wri.org/s3fs-public/uploads/Missing_Middle_Adaptation_Finance_-_Global_Commission_on_Adaptation.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }