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Developing Improved Climate Products for Effective Climate Risk Management

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Title: Developing Improved Climate Products for Effective Climate Risk Management


1
Developing Improved Climate Products for
Effective Climate Risk Management C. F.
Ropelewski International Research Institute for
Climate and Society The Earth Institute, Columbia
University 31st Climate Diagnostics and
Prediction Workshop 23-27 October 2006 Boulder, CO
2
Development of new climate products for Effective
Climate Risk Management Involve the Users from
the start Considerations Be aware of the
other factors effecting the system. Understand
the limiting factors (Internal and
External) Encourage flexibility in decision
making and understand how much flexibility
resides in the system. Be aware that there may
be alternatives to those offered in the use of
climate information.
3
Institutions and Policies Research
  • Methodologies for mapping institutions and
  • policy process
  • Methodologies to analyze policy responses and
  • development outcomes
  • Methodologies to analyze institutional utility
  • of climate information

4
Example 1 - Health
Epidemic Preparedness and Response (EPR) An
example of how climate information can influence
decisions in a real-world setting.
5
(No Transcript)
6
Why EPR Planning Outbreak Detection and
Response Without Preparedness
Delayed Response
Late Detection
First Cases
CASES
Opportunity for control
DAY
7
Why EPR Planning Outbreak Detection and
Response Without Preparedness
Rapid Response
Early Detection
Potential Cases Prevented
CASES
DAY
8
Case Study Public Health, Botswana Dec-Feb
RAINFALL and Jan-May MALARIA incidence
(Thomson et al, 2006 Nature)
9
Environmental monitoring
Example in Botswana
ENV monitoring enables opportunities to mobilize
more localized response gtgt
10
Seasonal Forecasting
..
SCF offers opportunities for planning and
preparedness .
NMCP strengthen vector control measures and
prepare emergency containers with mobile
treatment centers
11
Example 2 Agriculture Using climate
information to inform decisions in agriculture.
12
Case Study Agricultural production, SE S.America
Adjusting crop management practices to ENSO phases
Maize Changing sowing date and hybrid type La
Niña years shorter season hybrid, late sowing
date
13
Gross Margins for Rainfed Maize
(1960 2001)
CERES Model
14
Gross Margins for Rainfed vs Irrigated Maize
(1960 2001)
CERES Model
Rainfed
Irrigated
15
Example 3 Reservoir Management Using
climate information to inform decisions in Water
Resources.
16
Case Study Angat Reservoir, Philippines Assume
that the current priority in water allocation is
honored 1st Manila water supply 2nd
Irrigation 3rd Hydropower
Oct-Feb performance of the reservoir
17
Index insurance
  • Insurance is a key tool to allow use of
    information in decisionmaking
  • Problems with traditional crop insurance
  • Moral hazard
  • Adverse selection
  • The index innovation
  • Insure weather index (such as seasonal rainfall),
    not crop
  • Only partial protection (basis risk), should not
    overuse
  • Cheap, easy to implement, good incentives
  • Minimum possible price (easy to determine)
  • aver insurance payout admin risk finance
    costs
  • This price must lt value to client for market to
    exist

18
Case Study Index Insurance, Southern Africa
  • In Malawi, smallholder farmers report they
    cannot currently obtain inputs necessary to
    address climate variability
  • New contracts provide for a package of loans,
    groundnut and maize inputs
  • Working toward packages including price
    incentives, risk protection to take advantage of
    forecasts
  • Partners include Malawi farmers and financing
    associations (NASFAM, OIBM MRFC, Malawi Insurance
    Association), the World Bank CRMG, Malawi Met
    Service, CUCRED

19
Summary of current activities in Africa
  • Ethiopia
  • Drought famine relief (client national
    government, pilot 2006)
  • Crop loss micro-insurance (client farmers,
    pilot 2006)
  • Morocco
  • Crop loss micro-insurance, climate change
    problems
  • South Africa Relatively developed financial
    markets
  • Apple grower cooperatives and freeze coverage
  • Malawi
  • Drought relief (client national government,
    pilot 2006)
  • Farm level crop loss, bundled contracts (900
    farmers, transacted 2005)
  • Scoping Tanzania, Uganda, Kenya, more on the way
  • India BASIX, thousands of farmer transactions
    completed World Bank CRMG, Re-insurers, WFP
    highly involved

20
SUMMARY Climate Risk Management provides More
resilient systems for management of seasonal
climate variability. and A mechanism for
building management systems to cope with climate
variability on longer time scales Tailoring
climate information to risk management problems
is key methodological issue Early and effective
engagement with stakeholders is essential For
most effective and timely implementation,
institutional mapping is key
21
Summary (continued) Be aware of the other
factors effecting the system. Understand the
limiting factors (Internal and External) Encourag
e flexibility in decision making and
understand how much flexibility resides in the
system. Be aware that there may be alternatives
to those offered in the use of climate
information. Involve the Users from the start
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