The climate risk management process 1. Analysis and assessment of climate risks

Climate risk management is based on comprehensive and continuous risk assessments. Identifying risks (risk analysis) and then assessing the scale of their impact lays the foundation for prioritising actions that need to be taken and identifying options that cover as many of the risks as possible.

By drawing on forecasts for the future developments of the climate, the economy or demographic trends, it is possible to make plans today which take into account risks that may have a negative impact on future development.

This involves, for instance, looking at sectors which are particularly threatened by climate change and are of vital importance for livelihoods in many developing countries, such as farming, fisheries and water.

Screenshot of the  AGRICA project website

Screenshot of the AGRICA project website

Screenshot of the  AGRICA project website

Against this background the BMZ has commissioned the Potsdam Institute for Climate Impact Research (External link) (PIK) to conduct comprehensive climate risk analyses for the agricultural sector in selected African partner countries. Thus, under the umbrella of the AGRICA (External link) project titled “Climate risk analyses for adaptation planning in sub-Saharan Africa (External link)”, the PIK has already completed climate risk analyses for Ethiopia, Ghana, Burkina Faso and Niger and a district-level study for northern Ghana.

Video: Impacts of climate change on crop production in Ghana's Upper West Region

Still from the video "Impacts of climate change on crop production in Ghana's Upper West Region"
This film provides a snapshot of climate impacts on the agricultural sector in Ghana’s Upper West Region (UWR). Extreme weather events, such as floods, droughts and heat waves, have occurred more frequently and more heavily as a result of climate change, affecting the livelihoods of the local population and the economic growth of the region. This trend is likely to continue, but effective adaptation strategies can enable local smallholder farmers to better cope with these challenges.

The climate risk analyses set out existing and future climate risks for the partner countries and identify different ways for agriculture to adapt to these risks. In addition, the studies also examine the economic consequences of climate change by carrying out cost-benefit analyses of different ways of adapting to climate change.

The comprehensive information base that is thus compiled enables decision-makers to assess risks better and purposively deploy limited funds for resilience-building measures. The PIK cooperates closely with relevant partner governments in drawing up the climate risk analyses, also involving local actors from the start and drawing on local expertise, in order to build capacities in partner countries and ensure that the climate risk analyses are adapted optimally to local conditions.

The PIK is currently conducting and will conduct further climate risk analyses in partner countries in sub-Saharan Africa. Analyses are in progress for Cameroon, Uganda and Zambia. Future climate risk analyses shall extend the approach to further issues and sectors beside agriculture, including value chains, gender, water, deforestation and climate risk financing.

In addition, the PIK is commissioned by the BMZ to draw up climate risk profiles in African countries that are especially hard hit by climate change based on climate and socio-economic scenarios (already completed for Burkina Faso, Cameroon, Chad, Côte d'Ivoire, Ethiopia, Ghana, Kenya, Mali, Mauritania, Niger, Tanzania, Madagascar, Senegal, Uganda and Zambia).

The climate risk profiles provide a concise overview of additional, specifically selected vulnerable key sectors in the partner countries: farming, water, infrastructure, ecosystems and health. They thus have the potential to mainstream climate aspects in the medium- to long-term climate and development strategies of partner countries and provide a sound basis for making Germany’s development cooperation activities climate smart.

As at: 14/10/2022