Regional Context
SICA region countries are among the most exposed to climate phenomena in the world. Their societies, ecosystems, and production systems – especially rural areas – are particularly vulnerable to the adverse effects of climate change in part because of their geography: Central American countries are located on a narrow isthmus between two continents, between the Pacific and Atlantic oceans, and have long coastlines and much land at or close to sea level. Climate change and variability will continue to magnify socioeconomic vulnerabilities in the region and will increasingly influence rural living conditions and the economic development of production activities; because of this, it is ever more urgent to develop structural change in a way that improves the existing relationship between inclusion, sustainability, and productivity. From the perspective of public policy responses to climate change, this framework will provide the necessary actions for comprehensive risk management, sustainable and inclusive adaptation to climate change, and the transition to sustainable, low-emission economies.
The agricultural sector is one of the economic drivers of the Central American and Dominican economies, making up about 6% of total GDP in 2015 (not including Belize). With agroindustry, the sector makes up between 11 and 13% of national GDP in Costa Rica, Panama, and the Dominican Republic and between 21 and 23% in the other four countries. The sector contributes 40% of total exports, employs a considerable portion of the economically active population, and is an important source of income for rural households. It produces basic foods important for the nutritional security of wide sectors of the population, including corn, beans, and rice. The sector is also highly heterogenous socioeconomically, culturally, in terms of production systems and dynamism, and exerts pressure on the environment via deforestation, water consumption, soil degradation, and pollution.
In such a complex context it is advisable to promote inclusive and sustainable adaptation strategies for the sector and for food and nutritional security that combine actions to reduce poverty and vulnerability to climate change and to transition to more sustainable and low-carbon economies; to this end, the Sustainable Agricultural Strategy Adapted to the Climate (in Spanish, la Estrategia Agricultura Sostenible Adaptada al Clima) is the underlying reference in SICA. The agricultural sector is highly vulnerable to climate change, but also is the second largest emitter of greenhouse gases and could become the largest emitter in the coming decades. The sector also is home to a significant part of the population living in poverty, who produce basic foods important to the regional diet; because of this, poverty is a component of fragility that deserves immediate attention. Thus a strategic vision is required to maximize co-benefits and minimize costs to value chains and at the farm level. In this sense, the strengths of adaptation, of integrating adaptation into agricultural mitigation plans, and of mitigation programs based on adaptation that the region is implementing are very important.
The Strategy for Sustainable Agricultural Climate Adaptation (in Spanish, EASAC: la Estrategia de agricultura sostenible adaptada al clima) was approved by the Ministers of the Central American Agricultural Council (in Spanish, CAC: Consejo Agropecuario Centroamericano) in 2017 as a key instrument to promote a more competitive, inclusive and sustainable economy adapted to the effects of climate change and climate vulnerability, which increases productivity via conservation and the sustainable and efficient use of water, of biodiversity, of soil, and of forests in order to guarantee food and nutritional security. The initiative, promoted by ECLAC in coordination with the CAC Executive Secretary and its consulting committees to build capacity for sustainable agriculture and food and nutritional security adapted to climate change, responds to the request of CAC Ministers for cooperation to implement the EASAC.
Precursors
Environment and/or Finance Ministers and SIECA, as part of SICA member countries, have developed the Economics of Climate Change Initiative in Central America and the Dominican Republic (in Spanish, ECC CARD: la Economía de Cambio Climático en Centroamérica y la República Dominicana) together with the ECLAC Subregional Headquarters in Mexico. As part of the Initiative, scenarios of the potential impacts of climate change were developed at the macroeconomic level and on a few key sectors, in addition to dialogues on public policy options and the development of sectorial lines of action, giving priority to sustainable and inclusive adaptation. The initiative opened areas of work with national and regional authorities on agriculture and health, generated a series of co-publications that contributed to the existing evidence on vulnerability in the region at the international level and informed the design of public policies, and supported capacity building and sensitization on climate change risks and response options.
Program Goal
Strengthen national and regional technical capacity in SICA countries to implement public policies at the national level and EASAC at the regional level that promote an agricultural sector that is sustainable, inclusive, and adapted to climate change and that benefits small, rural producers and low-income consumers.
ECLAC, together with relevant partners (see below), will work on three principle components: a) impacts of climate change on the agricultural sector and on nutritional security and response options; b) agricultural insurance from a comprehensive risk management perspective; and c) a program to develop information for public policies.
Goals by Component
a. Facilitate analysis and technical discussion spaces to contribute to public policy development at the regional and national levels and to develop implementation instruments.
b. Strengthen public information systems related to the agricultural sector, rural development, food and nutritional security, and technical capacity to generate analysis, contribute to public policy design and implementation, and share information with rural producers.
c. Develop and/or strengthen insurance mechanisms for the agricultural sector with a focus on comprehensive risk management, comprehensive service packages, and sustainable adaptation to climate change, prioritizing micro and small rural producers.
There will also be a governing component with the following goal:
d. Implement technical co-management processes and capacity building with key partners at the regional and national level, coordinating with other relevant initiatives.
Achievements by Component
Component A: Impacts of climate change on the agricultural sector and on food and nutritional security and response options
Themes covered included: potential impacts on basic grains and coffee; challenges to food and nutritional security in SICA countries; and methodological proposals to analyze the impact of climate change on food and nutritional security. Each theme was discussed with GTCCGIR to compile data, research methodology, discuss and revise results and develop lines of action in seminars with other specialized institutions and the food and nutritional community of practice. Four formal co-publications support this work (see Annex 2). ECLAC facilitated the participation of CAC Ministers in UN events on food and nutritional security and climate change in COP22 and 23 and the roundtable for Ministers of Agriculture in COP 22 organized by IICA.
Two collaborations at the national level: a response proposal, with INDOCAFE, CNCCMDL, Ministers of Agriculture and Environment, INDRHI and ONAMET, estimated the potential impacts of climate change on coffee in the Dominican Republic. Currently ECLAC is collaborating on the design of the NAMA Café “plus”, integrating adaptation and supply chain management strengthening. ECLAC collaborated on the Costa Rica MAG initiative to generate a proposal that covered extensionist renewal based on knowledge building, institutional articulation, and response to climate change with a proposal endorsed by the Minister and published. Currently, ECLAC is collaborating with the implementation.
Component B: Agricultural insurance from a comprehensive risk management perspective
The elaboration of criteria to evaluate advances in agricultural insurance, including information systems and their use, normativity evaluation, offer and demand conditions, and identification of next steps in each country; evaluation of advances and lessons learned about agricultural insurance in developing countries, including the CELAC initiative and other countries in Latin America. The four community of practice meetings open to all institutions and current initiatives in SICA have supported new initiatives and collaborations, with recommendations for next steps. Two regional co-publications and four national co-publications showcase the work done. Currently, a third regional co-publication is in progress with CAC and its consulting organs about agricultural insurance and conditions for the adaptation of insurance parameters.
National collaborations: Advice for the creation of public agricultural insurance institutions in Guatemala and El Salvador and the inclusion of agricultural producers and feasibility of climate index-based insurance in Costa Rica and Panama. In 2018 ISA, ETESA, MIDA, FAO and ECLAC worked on a pilot SPI and ASI based insurance product; ECLAC accompanied El Salvador’s BFA on their initiative to establish agricultural insurance; and ECLAC provided advice to Costa Rica’s INS on defining a roadmap for indexed insurance with the IRI and reinsurers.
Component C: A public policy information development program
Diagnoses of the current situation of information and improvement plans were developed at the national level with the technical assistance of Ministries of Agriculture, National Statistics Offices, Central Banks, and Offices of Food and Nutritional Security in SICA countries. Priorities included strengthening employees’ analysis skills: food balance sheets, time series, policy analysis, geographical information systems, and the management and administration of databases. CENTROESTAD, SIECA, and SECMCA participated in regional actions. One co-publication was completed.
ECLAC coordinated with FAO Rome to gather basic agricultural data, specifically related to production by volume, surface area, and yield, livestock production, public expenditure on agriculture, and annual prices received by producers for crops. As part of this initiative, ECLAC has assumed the monitoring of national Ministries of Agriculture and Statistical Institutes, and supported FAO Rome in the coordinated compilation process to the benefit of relevant institutions.
Expected Results by Component
Component A: Impacts of climate change on the agricultural sector and on food and nutritional security and response options
a. Public policies designed with the best available analysis and technical discussions between national and regional groups and practically designed instruments for their implementation.
Component B: Agricultural insurance from a comprehensive risk management perspective
b. Strengthened information systems and instruments of analysis and use of modern information technology, according to the improvement plans prepared at the national and regional levels.
Component C: A public policy information development program
c. National and regional insurance mechanisms designed for the agricultural sector with a focus on comprehensive risk management and prioritizing micro and small producers.
Result of development: A project that responds to national priorities and that supports technical capacities, south-south cooperation, and regional integration.
Partners
Central American Agricultural Council Executive Secretary (in Spanish, CAC: Secretaría Ejecutiva del Consejo Agropecuario Centroamericano)
Technical Group on Climate Change and Comprehensive Risk Management (in Spanish, GTCCGIR: Grupo técnico de Cambio Climático y Gestión Integral de Riesgos)
Regional Technical Committee (in Spanish, CTR: Comité técnico regional)
