In just a few short years, the Adaptation Fund (AF) has built a focused, effective, and transparent climate adaptation financing instrument that directly aids the most vulnerable communities in developing countries. In addition to pioneering direct access, the AF is seeing preliminary results from its project portfolio, allocating US$265 million specifically toward measures that increase ecosystem and human resilience in response to climate change and variability-induced stress, and increase adaptive capacity within relevant development and natural resource sectors. Examples of work in these areas include:

• Developing early warning systems and helping communities adopt climate resilient agriculture and building practices in Colombia.
• Reducing the risk of glacial lake outburst floods to enable 90% of households in the area to respond to early warning signals in Pakistan.
• Rehabilitating coral reefs in Belize.
• Creating water pricing and risk transfer/insurance schemes to help manage water supply and demand cycles in Honduras.
• Establishing financial mechanisms in river watersheds over roughly 43,000 square kilometers in Mongolia.
• Combating coastal erosion to protect the livelihoods of fishermen, fish sellers, female rice farmers, and tourism merchants in Senegal.

In aggregate, the Adaptation Fund is supporting activities on the ground in 44 countries, which will directly benefit 3.1 million people, train close to 13,000 people in climate resilience measures, develop 88 early warning systems, protect 87,000 meters of coastline, and restore/preserve over 10,000 hectares of natural habitat.

Over the course of five years, the AF has seen great demand from developing countries to undertake concrete adaptation activities in an effort to build resilience for their most vulnerable communities. These elements are enshrined in the AF’s strategic priorities, providing funding for adaptation solutions that best suit country needs, ranging from soft to hard infrastructure interventions. With well-established systems and a swift project cycle, the AF is well positioned to disburse funding quickly, but effectively, and with respect for financial rules and procedures. If the AF were to reach its current target of raising US$160 million by the end of 2015, we could double our expected impact within two years. We could do this by increasing the beneficiaries targeted globally, restoring ecosystem services, developing additional early warning systems for households to respond to disaster risks, continuing to diversify livelihoods for vulnerable farmers, doubling investments in coastal protection infrastructure, and increasing access to irrigation water and production schemes.

Moreover, the AF is still the only global fund with experience implementing direct access projects. The AF recently launched a readiness programme that promotes lessons learned and exchange of best practices about the full climate financing cycle, from accreditation to project design, proposal, and implementation. Through this, the Fund has established an engaged network of direct access practitioners, including civil society, that has fostered dialogue and greater collaboration, and contributed to increased coherence and streamlined approaches to climate finance readiness.

The readiness programme has allowed for the funding of grants to foster South-South cooperation whereby accredited national entities provide support to other developing countries seeking accreditation. There is a tremendous demand from countries to implement their own projects – the AF provides a perfect opportunity for countries to pilot this funding modality. The AF provides grant money of up to US$10 million per country with a focus on concrete climate change adaptation projects. It is therefore a logical place for countries with limited experience implementing projects or countries that are accustomed to channelling funds managed by multilaterals (UN agencies, World Bank, etc) to start.

The AF Board is committed to its goal to provide funding to the most vulnerable people to help communities adapt to rapid climate change. It is also committed to continuing to innovate and channel money through direct access, assisting countries in learning by doing and investing in strong organizations that can use the AF as a stepping stone to accessing larger amounts of funding (both grant and non-grant) from the Green Climate Fund (GCF).

The AF Board is proud of how far the AF has come in five years – it is a testimony to the hard work and engagement from many partners across the world in every sector, whether public, private, or civil society. We look forward to continuing that work over the next five years, building on our past experience, expanding to support more countries, and continuing to push the envelope on direct access.

The AF Board expresses its gratitude to contributors who have developed confidence in our processes since the beginning. The strong signal of Warsaw contributors, who helped us reach our US$100 million resource mobilization target for 2012-2013, has assisted vulnerable communities in more than eight additional developing countries. The Board welcomes further support in reaching its new resource mobilization target.