From Risks to Solutions
Having calculated the risks and positioned them on a map, it is then possible to develop a portfolio of local projects and assess adaptive benefits for each area. In any city, the pipeline of projects must be tailored to the needs, systems, and existing strengths of the area. Although most urban regions around the world tend to share some basic high-level objectives, the actions they'll take to meet those objectives varies by locale. In Lagos, the BCG team identified three core domains for action, each with its own proposed projects:
- Increase infrastructure resilience. A wide variety of initiatives could be launched to make critical infrastructure more flood resistant in Lagos. One example is coastal embankments to protect communities and businesses from sea level rise and flooding. Drainage systems should also be rebuilt to withstand severe flooding and erosion, and critical transportation systems could be made flood proof. Other projects include developing alternative water supplies and planting belts of mangrove trees, which help to reduce flooding and coastal erosion.
- Ensure more resilient communities and protect vulnerable groups. These projects have direct social impact. Social assets such as schools and health centers could be retrofitted to ensure continued access to essential services during climate-related events. This could involve more water-repellent materials or moving or elevating older buildings. Other projects include relocating people to safer ground if they so choose; increasing water access and quality with new sewage treatment plants and other means; and establishing infectious disease surveillance systems.
- Anticipate risks and improve crisis response. Emergency response measures are generally led by local governments to support communities in cases of climate-related events. These programs include maintaining and deploying emergency funds, establishing clear post-disaster procedures, and training first responders. This domain could also include awareness programs to educate residents on household and waste management as well as health measures to take during a crisis.
Although these three actions are specific to Lagos, any vulnerable city should likewise consider investing in a portfolio of projects designed for their own local needs. These should proactively address a range of possible climate scenarios, while being cautious to avoid overreaching or unintentionally maladaptive moves.
Vulnerable cities should consider investing in a portfolio of projects designed for their own local needs.
Mobilizing Funding and Support
The different types of projects that constitute an A&R portfolio need financing strategies tailored to their specificities. The type of funders likely to invest in a particular project depends on the project’s goals and context.
For example, funding sources such as governments in partnership with bilateral agencies, development finance institutions, or public climate funds tend to focus on projects with positive social impact or those that target public infrastructures. Grants and concessional funding can support projects where no immediate financial return is usually expected. This might include the rehabilitation of drainage systems and sea walls.
Private sector funding is just as critical. A fact-based and quantified approach to A&R will identify many opportunities for corporations and investors to participate. They can fund projects identified as bankable, that generate returns, and that protect those investors' assets, operations, and supply chains in the region.
There is also an opportunity to develop innovative public-private partnerships. These can fund projects like water treatment plants, which benefit both corporations and local communities. They can also unlock profitability. For example, the use of carbon credits to offset greenhouse gas emissions can make some A&R projects, like mangrove restoration, relevant to private investors.
The overall project pipeline should target a mix of capital sources: grants, low-cost public funding, domestic capital, climate-focused funds, and commercial investment. Implementation support is key to ensure resilience and progress. The government leading the A&R effort, therefore, must have a clear governance system, favorable policy and legislation, and the resources to deliver and monitor results.
Coastal cities are among the most severely affected by climate change. They will do well to follow Lagos’ example. As they proceed, government and business leaders need guidance in advanced data analytics and granular decision making. They also need enabling structures, such as robust A&R planning and funding support, that allow them to focus on the most critical challenges and viable solutions.
Lagos is one example of an approach many cities around the world need to take. Processes like these take time and must therefore be initiated now.
The urgency of A&R action is now becoming clear to all. It was a key message at the November 2022 COP27 in Egypt, where the UN Climate Change High-Level Champions advocated for concrete actions around the Sharm el-Sheikh Adaptation Outcomes for Human Settlements. For more detail, this BCG report describes climate risk and the adaptations that will be needed for resilience. Lagos is one example of an approach many cities around the world need to take. Processes like these take time and must therefore be initiated now.
It may be too late to prevent the climate change crisis from coming. But there is time to respond and adapt. With comprehensive A&R systems in place, cities like Lagos may well find themselves leading the way.