After the successful launch in Thailand in May 2023, the “Enhancing Risk Assessments (ERA) for Improved Country Risk Financing Strategies” project now officially commenced in its second project country Egypt with the kick-off workshop that took place on June 13-14, 2023 in Cairo.
The ERA project is commissioned by the Deutsche Gesellschaft für International Zusammenarbeit (GIZ) GmbH and implemented in Egypt and Thailand by GIZ’s Risk Finance & Insurance team together with United Nations University – Institute for Environment and Human Security (UNU-EHS) / Munich Climate Insurance Initiative (MCII) for a period of two years from January 2023 – December 2024. The overall goal of the ERA project is to improve risk assessments to inform effective adaptation and risk financing strategies and ultimately enable better protection against losses and damages. Therefore, the ERA project will implement the “Economics of Climate Adaptation” (ECA) framework using the underlying open-source risk assessment tool CLIMADA. Moreover, the project will link the General Equilibrium Model from GIZ’s project “Climate-Resilient Economic Development” (CRED) to CLIMADA (enabling the impact analysis of climate hazards on macroeconomic indicators such as GDP and employment in specific sectors), integrate non-economic impact analysis, and further develop a simple graphical user interface (GUI) for CLIMADA.
The successful kick-off workshop for the project in Egypt was hosted by Egypt’s Financial Regulatory Authority (FRA) in partnership with GIZ’s project “Promotion of Access to Financial Services for Small and Medium Enterprises (PAFSME)”. The workshop was attended by 50 representatives from various sectors, including the government, private sector, academia, and international organizations. The workshop aimed at introducing the project to relevant stakeholders in the country and jointly scoping the risk assessment, meaning identifying hazards, sectors, and economic/non-economic assets that are important for the country and should be analyzed in the project. During the workshop, the participants agreed that the project should focus on estimating the impacts of heatwaves and sudden heavy precipitation in 2050 considering the climate scenarios of SSP RCP 4.5 & SSP RCP 8.5. The impacts should be analyzed on economic assets such as water sources, crops, livestock, hotels, and power plants. The representatives also agreed to evaluate the effects of these hazards on non-economic assets such as mobility, water access, access to education and health, and identified various sectors for which they would be keen to find out the impact on different macroeconomic indicators. Particularly remarkable during the workshop was the interest by academia in the risk modelling tool CLIMADA – which ideally will lead to further fruitful collaborations to complement the ERA project.
The following steps for the ERA project in Egypt involve collecting and verifying the data and assumptions for the risk assessment. Furthermore, in later phases, the project will work with the relevant stakeholders to identify suitable adaptation measures for the cost-benefit analysis and undertake multiple training sessions for which participants have already expressed great interest. Fruitful partnerships and continuous efforts under the ERA project will significantly improve Egypt’s capacity for risk assessments and risk management and enhance the country’s resilience to climate change.