In Episode 2 of Climate Solutions, we move to Tajikistan in Central Asia to focus on a project launched in 2016 by CIF and the European Bank for Reconstruction and Development (EBRD). Called the Tajikistan Climate Resilience Financing Facility - or CLIMADAPT - this project is a good example of how a focus on improving gender equality can benefit an entire country and accelerate the fight against climate change.
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3 questions for Mafalda Duarte, Head of the CIF
What is the problem you were trying to solve?
Tajikistan is a country with a population of over 9.5 million people. It is landlocked, with limited natural resources, and one of the most climate vulnerable countries in that part of the world. So Tajikistan depends heavily on rainfall and snowmelt from the country's mountains, both for water but also for electricity because of its large hydro power plants. Climate change means that the projected changes in precipitation and snowmelt runoff from these mountains are expected to have an impact on water and electricity, soil erosion and land degradation.
This is a country with a population living mostly in rural areas and very reliant on agriculture, which employs more than half of the population. What is more, in Tajikistan women account for 69% of the total employment in agriculture, because of limited opportunities in other sectors.
How did we solve it?
We supported a climate resilience financing facility, called CLIMADAPT, which improved access to finance by offering lower-than-market rates. This provided the incentive for investing in technological solutions for climate resilience that were not previously available. For example, tubes for irrigation purposes, specific types of irrigation purchasing equipment, and water saving systems.
Importantly, the facility put gender equality at the core of what they were trying to achieve. The local financial institutions were flexible in adapting their collateral requirements for accessing these loans and accepting the use of jewellery and other commercial assets as collateral by women.
We also built capacity and increased access to these technological climate solutions. So the end of this project, we established a comprehensive list of pre-approved technologies and suppliers. Through workshops, and other activities, we introduced these technologies to these entrepreneurs, farmers and particularly businesswomen.
The results were very interesting on three levels. We saw more climate resilience through improved reliability of energy and water supplies and reduced soil erosion. We saw very good economic impacts such as reduced energy costs, reduced water expenses and increased income.
But there is another very important dimension to this project around gender equality and women’s empowerment. We saw increased access to information and business opportunities for women. 92% of women said they now spent less time on household tasks. They also reported improved health and wellbeing. Last but not least, 60% of women now had more weight in financial decisions on family assets and household equipment. Why is this so important? Here we are talking about an impact on social norms. The moment we start impacting and influencing social norms, we can really start to see behavioural change.
What lessons can we learn to apply to other projects?
There are many lessons which can be replicated widely around financing and technology. But the key point I want to focus on is that this shows why projects should have a focus on women and gender equality. There are studies, including a famous one by McKinsey Global Institute, that suggest that advancing gender equality could potentially add $12 to $28 trillion dollars to global GDP by 2025.
Why is this so important? Because in the case of Tajikistan, women are more vulnerable than men to the effects of climate change. They represent the core of employment in the agricultural sector, which is itself highly vulnerable to climate change. Also, the UN found that 80% of people displaced by climate change globally are women.
There is a real opportunity here. In many parts of developing countries, women are consistently perceived as being more creditworthy. So by lending to women, these local financial institutions are building quality portfolios for themselves. Women are associated with lower portfolio risk and with higher loyalty so from a business point of view, it is a win win. This is a lesson for every climate project: women must be front of mind when designing the project, and empowered to lead its implementation.