The Chinese Academy of Agricultural Sciences (CAAS) and the International Food Policy Research Institute (IFPRI) jointly hosted the International Conference on Climate Change and Food Security (ICCCFS) November 6-8, 2011 in Beijing, China. This conference provided a forum for leading international scientists and young researchers to present their latest research findings, exchange their research ideas, and share their experiences in the field of climate change and food security. The event included technical sessions, poster sessions, and social events. The conference results and recommendations were presented at the global climate talks in Durban, South Africa during an official side event on December 1.
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Climate Risk Management in China's Agricultural Sector Claire Hsu Intern, International Food Policy Research Institute (IFPRI) Presented at the International Conference on Climate Change and Food Security Organized by the Chinese Academy of Agricultural Sciences (CAAS) and the International Food Policy Research Institute (IFPRI) November 8, 2011 , Beijing, P.R. China
Transcript
Climate Risk Management in China's Agricultural Sector
Claire HsuIntern, International Food Policy Research Institute (IFPRI)
Presented at the International Conference on Climate Change and Food Security Organized by the Chinese Academy of Agricultural Sciences (CAAS) and the
International Food Policy Research Institute (IFPRI) November 8, 2011 , Beijing, P.R. China
Climate Risk Management in China's Agricultural Sector
I. China's Agricultural Development and its ChallengesFood Safety and SecurityTightening Resource ConstraintsExtreme Weather EventsGrowing Rural‐Urban Inequality
II. The Impact of Climate Change on China's AgricultureDirect Impacts of Climate Change on Chinese AgricultureIndirect Impacts of Climate Change on Chinese AgricultureUncertainties of Forecasts
III. Building Agricultural Resilience Through Climate Risk ManagementDeveloping an Agricultural Climate Risk Management FrameworkKey Agricultural Climate Risk Management and Adaptation Measures
IV. Summary and Policy Recommendations
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Presentation Notes
This chapter is on the implications of climate change for China's agricultural sector and its main objectives are to illustrate the risks associated with climate change within the larger sectoral development agenda and to identify key strategies for climate risk management and adaptation. First, we provide an overview of the current sectoral goals, paying particular attention to food-security. Different challenges to sectoral development are listed as well as policies aimed at addressing these obstacles. Second, we hone in on one of these sectoral challenges, climate change, and discuss how increases in weather variability and extreme weather events will pose a severe threat to Chinese agriculture. Third, we introduce the conceptual framework for climate risk management and enumerate key adaptation strategies, challenges to adopting them and methods for prioritizing them. The fifth and final part of this report offers policy recommendations for climate risk management in China and presents methods for designing and implementing climate risk management protocols.
China's Agricultural Development and its Challenges
Figure 1: Strengthening China’s food security (in terms of proportion and number of people living below $1.25 a day)
Source: Fan (2010)
Figure 2: China’s agricultural production growth rates
Source: Huang and Rozelle (2009)
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Presentation Notes
China's main priorities regarding sustainable agricultural development include food security, rural employment, natural resource conservation and environmental protection, all of which play a role in reducing vulnerability. Chief among these goals are food security and food self-sufficiency as keeping grain affordable for China’s large urban population is a matter of national security and stability. Food self-sufficiency is a long-standing priority in China and it is agricultural policy to achieve at least 95 percent food self-sufficiency so as to assure the material basis of food security. China now feeds nearly a fifth of the world’s population using less than seven percent of the world’s arable land and has been amazingly successful at strengthening food security, through reducing vulnerability, and improving food self-sufficiency (see box 1).
China's Agricultural Development and its Challenges: Food Safety and Security
Greater attention paid to supply chain management in addition to enhancing productivity
Many innovations have enabled high‐quality food production and better‐linked production to consumers
Deploying food safety policies in concert with existing self‐sufficiency policy regime
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Presentation Notes
Reflecting consumers’ increasing anxiety about food safety and quality control issues, the government has begun to emphasize supply chain management in addition to enhancing productivity. In the last two decades, many innovations have enabled high-quality food production and better-linked production to consumers. Despite its increasing emphasis on food safety, the Chinese government continues to aim for grain self sufficiency for strategic reasons and especially in light of the challenges posed by climate change.
China's Agricultural Development and its Challenges: Tightening Resource Constraints
Rapid industrialization and urbanization have spurred demand for land for industrial and residential use» The acreage of arable land decreased from 1.95 billion mu in 1996 to 1.826
billion mu by the end of 2007, a decrease of 123 million mu over ten years, with a 12.3 million mu average annual decrease.
» The per capita acreage of arable land decreased from 1.59 mu to 1.39 mu over the same period.
In 2006, China’s per capita water resources were only 24% of the world level and agricultural access to these limited resources is increasingly threatened by:» Combined changes in temperature and precipitation» Industrialization and urbanization» Decreasing water table levels
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Presentation Notes
The major constraint to continued expansion of agricultural production in China is the increasing scarcity of land and water resources, which heighten pressure to increase productivity per unit of land. Rapid industrialization and urbanization have spurred demand for land for industrial and residential use, which has also resulted in widespread land acquisition from farmers. As a result, the acreage of arable land decreased from 1.95 billion mu in 1996 to 1.826 billion mu by the end of 2007, a decrease of 123 million mu over ten years, with a 12.3 million mu average annual decrease. The per capita acreage of arable land decreased from 1.59 mu to 1.39 mu over the same period. In response, the Chinese government recently announced a new food self-sufficiency plan, which seeks to keep arable land area stable and productive through 2025. Water scarcity is also worsening, and is of particular concern in northern China (Xie et al. 2009). In 2006, China’s per capita water resources were only 24 percent of the world level and agricultural access to these resources is increasingly threatened in a number of ways. Combined changes in temperature and precipitation have already heightened water scarcity (World Bank 2011), and climate models predict continued temperature increases (which speeds evaporation) and decreases in growing season rainfall in Northern China (Eijjasz and Zhang 2010). Furthermore, the rapidly increasing demand for water associated with non-farm sectors and trends, such as industrialization and urbanization, will further intensify water scarcity. At the same time, water table levels in China's north plain have continued to decrease over the past several decades, and as a result, the water supply for China's agricultural sector will continue to become even scarcer, further imperiling China's food self-sufficiency.
China's Agricultural Development and its Challenges: Extreme Weather Events
Figure 1: Agricultural areas under disasters in China 1978‐2009 (in kilo hectares)
Source: China National Bureau of Statistics (2010)
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Presentation Notes
China is one of the most disaster-prone countries in the world, suffering serious losses due to droughts, floods dry-hot winds, typhoons, hail, freezing temperatures and early frost (Nie 2011). Agro-meteorological disasters affect 50 million hectares, 400 million people, and result in 2000 billion yuan (1-3 percent of GDP) in damages annually in China (CSNARCC 2011), with agriculture as the sector most vulnerable to climate change and most affected by natural disasters (Tu et al. 2011; Wang et al. 2008). Furthermore, China’s vulnerability to climatic hazards is high not only because its expansive territory frequently exposes it to a variety of disasters but also because of its transitional economy, in which production and employment in sectors such as agriculture remain very important, such that millions of livelihoods are exposed to climate-related risks (Li, Lin, and Li 2007; CNARCC 2007; Tu et al. 2011; Wang et al. 2008; Xiong et al. 2009). In 2007, the agricultural labor force constituted 40.08 percent of the overall labor force, and the agricultural population accounted for 55.6 percent of China's total population (Tu et al. 2011). Beyond immediately disruptive impacts on production, climate shocks are also associated with loss of productive assets, impaired health, and destroyed infrastructure (Vermeulen et al. 2010). Climate change will be primarily experienced as shifts in the frequency and magnitude of extreme events (Vermeulen et al. 2010). Although China's agricultural production has historically been challenged by extreme events, China's climate has been experiencing these shifts for several decades now and extreme meteorological events have begun to occur more frequently (see Chapter 1, "The Physical Impacts of Climate Change on China"). Most studies predict that climate change will continue to intensify in China and that the occurrence of extreme weather events and natural disasters associated with climate change could continue to increase (World Bank 2011). At the same time, due to insufficient investment in agriculture in China, the sector's ability to resist meteorological disasters and climate change risk is inadequate (CNARCC 2007). In fact, adapting to extreme weather events is considered to be at the core of agricultural climate change adaptation in China.
China's Agricultural Development and its Challenges: Growing Rural‐Urban Inequality
The rural‐urban income ratio has increased from 1.9 in 1985 to 3.4 in 2009.
China's rural areas remain key in terms of population and employment. Permanent rural residents account for over half of the total population, while people employed in rural areas account for 2/3 of total employment.
The food security concerns of poverty stricken populations are especially acute and as China’s rural poverty rate is 8.3 percent, many in these rural areas are most at risk of food insecurity.
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Presentation Notes
Rising income inequality also poses a difficult policy challenge (MOA 2010). Despite rapid overall economic growth, there has been increasing income inequality among the population, in particular between rural and urban residents and between coastal and inland regions. The rural-urban income ratio has increased from 1.9 in 1985 to 3.4 in 2009. Despite this, China's rural areas remain key in terms of population and employment. Permanent rural residents account for over half of the total population, while people employed in rural areas account for 2/3 of total employment. Unfortunately, the food security concerns of poverty stricken populations are especially acute and as China’s rural poverty rate is 8.3 percent, many in these rural areas are most at risk of food insecurity (Rural Survey Department of the National Bureau of Statistics 2011). Moreover, as more than half of China's poverty-stricken population is concentrated in a number of poor counties and close to two-thirds of these poor counties are concentrated in the western region (Nie et al. 2010), failing to bridge the urban-rural income gap will keep comfort and stability out of farmers' reach, food security at risk and China’s social harmony in jeopardy. The regionally variegated affects of climate change on agriculture will further complicate efforts at shrinking this income gap and minimizing exposure to food insecurity. In 2005, the Communist Party of China (CPC) initiated the New Socialist Countryside (NSC) program in order to accelerate agricultural and rural development, stimulate the growth of farmer incomes, and address the swelling disparity between urban and rural incomes. In addition to maintaining China's strong economic growth, the new generation of leadership aims to close the widening income gap between those in the urban and rural areas and improve rural environmental protection and rural social security generally (Guo et al. 2005).
The Impact of Climate Change on China's Agriculture: Direct Impacts of Climate Change
on Chinese Agriculture
Direct Impacts of Climate Change on Chinese Agriculture» Climate Change Impacts on Crop Yields. » Climate Change Impacts on Cropping Patterns. » Climate Change Impacts on Livestock.
Indirect Impacts of Climate Change on Chinese Agriculture» Impacts of Climate Change on Agricultural Production.» Impacts of Climate Change on Crop Prices and Trade. » Food Security. » Regional Implications.
Sources of Uncertainty» Climate Models and Scenarios. » Uncertain CO2 Fertilization Effects. » Other Sources of Uncertainty.
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Presentation Notes
The hazards associated with climate change are manifested in both shifts (longer term changes in average annual temperature and/or precipitation) and shocks (increased weather variability and extreme weather events) and there are many dimensions to agriculture’s resulting vulnerability (Nelson et al. forthcoming). For example, higher temperatures may reduce yields of desirable crops and stimulate weed and pest proliferation as well (CNARCC 2007; Nelson et al. forthcoming) whereas increased variation in precipitation patterns heightens the probability of short-run crop failures and long-run production declines (Nelson et al. forthcoming). Ultimately, economic studies show that climate change will affect agricultural yield and cropping patterns (direct impacts), and also agricultural production, trade and food self-sufficiency (indirect impacts) (World Bank 2011; Wang, Huang, and Rozelle 2010; Chen, Wang, and Li 2009; Nelson et al. forthcoming). As the implications of extreme weather events for agriculture in China have received relatively little research attention (Shi and Chen 2009), it is on these impacts that we focus in our work. But as our piece serves as a synthesis of much of the work that has already been presented at these proceedings, I will not linger on this part of the chapter and will focus more on the other elements for the purposes of this presentation.
Building Agricultural Resilience Through Climate Risk Management
Sources: Rural Survey Department of the National Bureau of Statistics (2011) and Balzer and Hess (2010)
Building Agricultural Resilience Through Climate Risk Management
Risk: "the combination of the probability of an event and its negative consequences" (UNISDR 2009)
Figure 2: Sources of hazard, exposure and vulnerability
Sources: Rural Survey Department of the National Bureau of Statistics (2011) and Balzer and Hess (2010)
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Presentation Notes
It is clear that developing targeted adaptation measures and enhancing the capacity to adapt will play an important role in minimizing the adverse impacts of climate change and promoting sustainable development and agricultural production in China (NDRC 2007; Wang, Huang, and Rozelle 2010; Chen et al. 2009; Shi and Chen 2009; Vermeulen et al. 2010; ECA 2009). Furthermore, as most climate change impacts are expected to materialize through increased climate variability and intensified extreme weather events such as heavy rainfall, droughts, high sea levels, and possibly cyclones, with direct implications for disaster risk (Mitchell and van Aalst 2008), the links between climate change and disaster risk management (DRM) are readily apparent. Climate Risk Management (CRM) weds the concepts of climate adaptation and disaster risk management and refers to a process that aims to manage society’s vulnerability to climate related risks. CRM integrates a range of activities from preparedness and disaster mitigation to broader adaptive activities related to livelihoods, natural resources management, and considers ongoing as well as future changes in risks and uncertainties (UNDP, n.d.). Risk is defined by the United Nations International Strategy for Disaster Reduction (UNISDR) as "the combination of the probability of an event and its negative consequences" (UNISDR 2009). These two dimensions of risk events, frequency and severity, can be used to construct “risk layers” in order to manage risk effectively and this will be explained below. Additionally, risk is defined as the product of hazard, exposure and vulnerability or Risk = Hazard x Exposure x Vulnerability (see figure 2 below). Agricultural risk is therefore determined by the sector's exposure (or the value of agricultural assets), the vulnerability of the sector's assets to hazards, and the frequency and intensity of those hazards.
Building Agricultural Resilience Through Climate Risk Management
Developing an Agricultural Climate Risk Management Framework
Source: Adapted from Jha et al. (2011)
Building Agricultural Resilience Through Climate Risk Management
Building Agricultural Resilience Through Climate Risk Management: Hazard Assessment
Hazard analysis involves the estimation of the geographic impact of a risk event in terms of its severity, and frequency, and probability of future occurrence.
Hazard assessment requires scientific understanding of relevant natural phenomena, interpretation of historical records of the occurrence of extreme events, and interaction with projected climate scenarios, and it provides the basis for the identification of hazard zones, which can be presented on maps at various scales.
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Presentation Notes
The process of risk analysis begins with hazard analysis, which involves the estimation of the geographic impact of a risk event in terms of its severity (such as a drought's duration and intensity or a flood's depth and extent), frequency, and probability of future occurrence (World Bank et al. n.d.). Hazard assessment requires scientific understanding of relevant natural phenomena, interpretation of historical records of the occurrence of extreme events, and interaction with projected climate scenarios, and it provides the basis for the identification of hazard zones, which can be presented on maps at various scales (Kreimer et al. 1999). Such hazard maps can be used to depict the expected peak intensity of an event (as is done in earthquake zone maps) and the frequency of occurrence in a specific region (as is done in floodplain maps).
Building Agricultural Resilience Through Climate Risk Management
Building Agricultural Resilience Through Climate Risk Management: Hazard Assessment
t
Source: United Nations 2007
Building Agricultural Resilience Through Climate Risk Management
Building Agricultural Resilience Through Climate Risk Management: Exposure Assessment
Exposure is defined as "the total value of elements at risk" and is quantified using "the number of human lives and the value of the properties or assets that can potentially be affected by hazards.”
Exposure assessment is used to define the spatial distribution of the asset(s)‐at‐risk and to categorize them according to the entailed potential damage according to the relevant levels of hazards.
Comprehensive agricultural exposure analysis should include residential (population and households) and infrastructural (roads and railways) exposures in addition to agricultural (crop area and its production) exposures
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Presentation Notes
Exposure is defined as "the total value of elements at risk" and is quantified using "the number of human lives and the value of the properties or assets that can potentially be affected by hazards" (WMO, n.d.). Exposure assessment is used to define the spatial distribution of the asset(s)-at-risk and to categorize them according to the entailed potential damage of the relevant levels of hazards (World Bank et al. n.d.). Comprehensive agricultural exposure analysis should include residential (population and households) and infrastructural (roads and railways) exposures in addition to agricultural (crop area and its production) exposures (World Bank et al. n.d.), and requires the availability of an extensive national-level database of rural assets, the quantification of a number of assets located in hazard prone areas, and the development of asset profiles and an analysis of their proneness to various natural hazards (ADPC et al. n.d.).
Building Agricultural Resilience Through Climate Risk Management
Building Agricultural Resilience Through Climate Risk Management: Vulnerability Assessment
The vulnerability of a system refers to "the characteristics and circumstances of a community, system or asset that make it susceptible to the damaging effects of a hazard.”
There are many dimensions of vulnerability, due to various physical, social, economic, and environmental factors, such as improper design and construction of buildings, insufficient protection of assets, insufficient public information and awareness, limited official recognition of risks and preparedness measures, and poor environmental management.
Vulnerability varies significantly within a community and over time and the goal of vulnerability assessment is to quantify the vulnerability of assets subjected to hazards
Presenter
Presentation Notes
The vulnerability of a system refers to "the characteristics and circumstances of a community, system or asset that make it susceptible to the damaging effects of a hazard" (UNISDR 2009). There are many dimensions of vulnerability, due to various physical, social, economic, and environmental factors, such as improper design and construction of buildings, insufficient protection of assets, insufficient public information and awareness, limited official recognition of risks and preparedness measures, and poor environmental management. Vulnerability varies significantly within a community and over time and the goal of vulnerability assessment is to quantify this dynamic feature of assets subjected to hazards (World Bank et al. n.d.). As there are many aspects to vulnerability, so also are there many modalities for vulnerability assessment. Several types of vulnerability assessment are especially relevant to agricultural risk assessment and these are discussed below. A biological vulnerability assessment considers the impact of a hazard event on crop production. In the case of droughts, biological vulnerability is determined by modeling the potential losses in crop yields caused by droughts at different phenological stages (World Bank et al. n.d.). In the case of floods, biological vulnerability can be estimated by relating crop area and production with seasonal maximum flows at various gauge sites to predict crop production losses. A physical vulnerability assessment is used to determine the expected performance of structures, infrastructure, and institutions under the load exerted by extreme natural events (Kreimer et al. 1999). There are a number of well-known causes of physical vulnerability, such as unreinforced masonry (which is known to perform poorly in particular types of earthquakes) and poorly secured roofs (which are known to suffer damage in hurricanes). Comprehensive performance differentiation is possible for a range of structure and infrastructure classes. An adaptive capacity assessment determines a system’s ability to manage hazards and typically makes use of vulnerability indices. Although these indices might not explicitly include determinants of adaptive capacity, their indicators often shed light on other factors, processes and structures that promote or constrain adaptive capacity. Research on vulnerability and adaptive capacity has revealed that some dimensions of adaptive capacity are generic (such as education, income, gender, age and health), while others are specific to particular climate change impacts (these may relate to institutions, knowledge and technology) (Adger et al. 2007; Mirza 2003; CSNARCC 2011). Furthermore, the huge social and human cost of extreme weather events is poorly (if at all) accounted for in developing countries, and is not fully captured in the macroeconomic parameters (Mirza 2003). Ultimately, a comprehensive understanding of vulnerability requires the integration of disparate measures of vulnerability
Building Agricultural Resilience Through Climate Risk Management
Building Agricultural Resilience Through Climate Risk Management: Estimate the Damages and Losses
The probability estimation for specific loss scenarios involves the consideration of established probabilities of natural event occurrence and expected structural performance.
Damage to the crop sub‐sector consists of damage to soil, irrigation infrastructure (mainly in the public sector), irrigation network, and agriculture buildings and machinery. Crop loss consists of the potential production loss from seasonal crops (one season) as well as from perennial fruit (over the multi‐year period required to initially bear fruit) and is estimated using farm gate prices.
Damage to the livestock sub‐sector consists of animal deaths that are due to climate hazards. Loss refers to the potential production loss from animals over the multi‐year period required for young animals to start producing milk or meat.
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Presentation Notes
When hazard, exposure and vulnerability analysis are combined, it is possible to develop estimates of potential losses. The probability estimation for specific loss scenarios involves the consideration of established probabilities of natural event occurrence and expected structural performance. Disaster loss assessment is a valuable tool for public decision-makers as governments are able to better plan for development, evaluate options for mitigation or risk-reduction investments and plan for response needs before a disaster occurs (Kreimer et al. 1999). Damage and Loss in the Crop Sub-sector. Damage to the crop sub-sector consists of damage to soil, irrigation infrastructure (mainly in the public sector), irrigation network, and agriculture buildings and machinery. Damage can be estimated by using quantities of the damaged assets (such as agricultural area, irrigation equipment, agricultural machinery, and buildings) and the corresponding farm gate prices for tradeables (such as equipment) or replacement cost for the non-tradeables (such as irrigation infrastructure). Crop loss consists of the potential production loss from seasonal crops (one season) as well as from perennial fruit (over the multi-year period required to initially bear fruit) and is estimated using farm gate prices (Government of Yemen et al. 2009). Damage and Loss in the Livestock Sub-sector. Damage to the livestock sub-sector consists of animal deaths that are due to climate hazards. Livestock damage is estimated by using the number of animal deaths and the market price at the farm level. Loss refers to the potential production loss from animals over the multi-year period required for young animals to start producing milk or meat (Government of Yemen et al. 2009).
Building Agricultural Resilience Through Climate Risk Management
Building Agricultural Resilience Through Climate Risk Management: Find the Best Adaptation Options
Sources: Adapted from Ramasamy (2011), Goodland (n.d.), and Luxbacher and Goodland (n.d.)
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Presentation Notes
The identification and appraisal of options to manage risk should consider options at the policy level, which may relate to activities such as capacity building or establishing institutional structures, and include the support of adaptation activities at the local level. Selecting appropriate risk management measures requires the categorization of disaster risks and responses along the two dimensions of risk delineated by the UNISDR: the probability of a disaster's occurrence and the severity of its negative consequences (see figure 5) (Goodland, n.d.; Luxbacher and Goodland, n.d.; Ramasamy, n.d.). Although there is a spectrum of risk types, they are generally organized into three distinct levels or layers. The first layer which includes high probability disasters associated with low losses can be responded to with autonomous risk reduction and retention actions which prevent such events from occurring, or reduce the severity of losses incurred at the local level. The second layer which includes low probability disasters which are associated with high losses can be responded to with risk retention and reduction plus risk transfer actions which transfer risk to a willing third party, at a cost (Goodland, n.d.). Such financial transfer mechanisms trigger compensation or reduce the losses in the case of a risk generated loss, such as insurance, re-insurance, and financial hedging tools. The third layer includes very low probability disasters which are associated with catastrophic losses which can be responded to with risk retention and reduction, risk transfer, plus risk coping actions which enable coping with the losses caused by the risk event, such as government assistance to farmers, and debt re-structuring.
Building Agricultural Resilience Through Climate Risk Management
Building Agricultural Resilience Through Climate Risk Management: Implement the Adaptation Plan
Action‐oriented coordination.
Enhance awareness of adaptation.
Improve inter‐departmental coordination of adaptation policy and action.
Coordinate planned adaptation and autonomous adaptation.
Mainstream adaptation and institutionalize adaptation funding.
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Presentation Notes
Despite noteworthy government efforts on climate adaptation in China, climate risk management so far has primarily dealt with conceptualizing the issue rather than with the actual implementation of adaptive measures. Farmers’ autonomous actions have historically played a central role in the country’s climate change adaptation and it is particularly critical to integrate farmers’ autonomous and community based adaptations (CBAs) into national climate adaptation policy frameworks and to engage them in the formulation of national policy and action in order to move beyond concept to action. An extension of this is the creation of an enabling socio-political environment that provides agricultural producers with sufficient climate adaptation information, which, in turn, encourages local communities to innovate locally-appropriate strategies. More resources should also be devoted to initiatives that promote the design and implementation of local adaptations. Integrating adaptation into the country’s technology extension system could further enhance local adaptation capacity (Nelson et al. forthcoming). Another strategy for bridging the gap between policy formation and implementation is to mainstream adaptation into the larger policy and development framework across all levels of government. Meaningful mainstreaming will require the creation of a horizontal fund specifically designated for the development of China’s adaptive capacity (Nelson et al. forthcoming). Such a fund would also address China's adaptation funding shortage. Establishing such a fund, which could be managed by the National Leading Group on Climate Change, should be prioritized. Government bureaus could apply to this special fund for projects that have a demonstrated focus on adaptation. Furthermore, the fund should support the development of timely and effective region-specific action plans for climate adaptation as the impacts of climate change vary throughout China’s numerous regions. The creation of such a fund may require that sub-national coordinating institutions be strengthened or established to facilitate this funding at the local level. Addressing knowledge gaps and developing analytical tools for costing, prioritizing, and sequencing specific adaptation measures, and analyzing their institutional and social aspects will also be critical in optimizing the impact of adaptation plan funding. Finally, as this recommendation is less amenable to financial support by international donors, donors could instead provide technical support and introduce best practices for developing the fund. Enhance awareness of adaptation. The Chinese government has established a National Leading Group on Climate Change, which is chaired by Premier Wen Jiabao and is responsible for planning national climate responses in collaboration with the National Development Reform Commission (NDRC), which was mandated by the Twelfth Five-Year Plan to provide an updated national adaptation strategy by the end of 2011. Despite these efforts, the central government has generally prioritized emission mitigation in its response to climate change and has historically paid less attention to systematic adaptation strategies. Even though provincial governments are required by the central government to formulate climate change response plans, which would do much to advance China's adaptive capacity, only a few provinces have taken the initiative to actually go about drafting these, several of which have benefitted from the support of UNDP in this effort. This relaxed attitude toward climate adaptation policy reflects both the central and provincial government's lack of awareness of the importance of climate adaptation (Shi and Chen 2009). Improve inter-departmental coordination of adaptation policy and action. Coordination of climate adaptation policy across government departments and bureaus seems particularly frustrated in China due to the absence of an overarching and systematic adaptation strategy. Government bureaus are presently undertaking climate adaptation actions separately and autonomously as part of their respective initiatives. For example, the new climate change scenarios based on Representative Concentration Pathways developed by the National Climate Center of China Meteorological Administration (CMA) have not been down-scaled to the regional level due to coordination failures between governmental bureaus. As a result, no down-scaled regional dataset has been created and these new RCP-based scenarios have not been integrated into climate change impact assessments (Shi and Chen 2009). Coordinate planned adaptation and autonomous adaptation. Farmers’ autonomous adaptation measures are not well coordinated with governmental planned adaptation due to insufficient understanding of farmers’ autonomous adaptation. For example, climate adaptation measures have yet to be formally mainstreamed into the agricultural extension service systems. Although this poses no problem for the adoption of many of the autonomous adaptation behaviors mainly based on farmers' own experiences (which are rarely implemented under the guidance of extension service staff), some farmers’ adaptive measures, such as switching crop varieties or changing sowing dates, adjusting the cropping system, and adopting mulching film, do need support from the government and their adoption would increase if they were included in the larger extension system (Shi and Chen 2009). Lack of coordination also impedes the funding of adaptation initiatives. A study by Zhang et al. (2008) finds that government structures and budgets function within vertical “silos” and that they are not well coordinated with each other (Chen and Ramsey-Elliot 2009). There is also no clear strategy for subsector prioritization (ADB 2009). Considerable regional and provincial variation also complicates attempts at formulating a national agricultural expenditure policy. Also, the mandates and responsibilities of different government agencies are vague, which prevents the establishment of a comprehensive and inclusive agricultural expenditure system capable of streamlining the decision-making, and monitoring and supervision processes. Despite the clear urgency of scaling up CRM, China simply lacks the capacity to implement and to enforce CRM measures. Additionally, although each department has and implements industrial CRM standards, these are far from uniform and would be difficult to align and uniformly manage. Mainstream adaptation and institutionalize adaptation funding. China's investment in climate adaptation has heretofore focused on climate change impact assessment research while international agencies, including the World Bank, CIDA, DFID, and UNDP, have provided the most support for climate adaptation demonstration projects (Shi and Chen 2009). This distinction is probably related to China's official negotiation stance, which maintains that developed countries should provide adaptation funds as compensation for climate change adaptation in developing nations. In order to mainstream climate adaptation into a development-planning framework, the central and local governments must also provide financial support for climate change adaptation. As a result, China’s capacity to manage catastrophic climate risks is also weak (CNARCC 2007; Wang and Zheng 2010). In fact, although extreme weather events have become more frequent, China’s investment in water infrastructure has decreased, and as a result the gap between climatic stress and coping capacity has actually widened. The current form of catastrophe management is focused on physical subsidy and societal donation (Wang and Zheng 2010), which typically falls short of the support required. In response to the Yushu earthquake of 2010, government aid only accounted for 2 percent of the direct economic loss, significantly less than what is needed to effectively compensate disaster loss. Similarly, when the southwest experienced severe drought the same year, direct economic loss totaled 24 billion yuan, however, the aid provided by the central government only amounted to 185 million yuan. With this in mind, it is important to note that investments in developing countries such as China are generally more focused on recovery from a disaster than on the creation of adaptive capacity (Mirza 2003; ECA 2009). As increased capacity to manage extreme weather events can reduce the magnitude of economic, social and human damage and related recovery costs, vulnerability to extreme weather events, disaster management and adaptation must be integrated into long-term sustainable development planning in developing countries such as China (Mirza 2003). Formalizing financial support for adaptation is clearly a high priority for China (ECA 2009) and should be pursued intelligently. Meaningful mainstreaming will require the creation of a horizontal fund specifically designated for the development of China’s adaptive capacity (Nelson et al., forthcoming). Such a fund would also address China's adaptation funding shortage (See box 3 for a discussion on estimates of China’s agricultural adaptation investment requirement). Establishing such a fund, which could be managed by the National Leading Group on Climate Change, should be prioritized. Government bureaus could apply to this special fund for projects that have a demonstrated focus on adaptation. Furthermore, the fund should support the development of timely and effective region-specific action plans for climate adaptation as the impacts of climate change vary throughout China’s numerous regions. The creation of such a fund may require that sub-national coordinating institutions be strengthened or established to facilitate this funding at the local level. Addressing knowledge gaps and developing analytical tools for costing, prioritizing, and sequencing specific adaptation measures, and analyzing their institutional and social aspects will also be critical in optimizing the impact of adaptation plan funding. Finally, as this recommendation is less amenable to financial support by international donors, donors could instead provide technical support and introduce best practices for developing the fund.
