As climate change accelerates, developing countries face heightened risks of extreme weather events, sea level increases and other natural disasters. This chapter delves into the imperative of making infrastructure climate resilient in the context of developing countries. Presenting perspectives from Africa, Asia and Latin America, and focusing on competitiveness-related infrastructure, the chapter clarifies the specific needs and challenges of these economies. From energy infrastructure to transportation and digital networks, this chapter underscores the need to improve planning and implementation capacities, as well as to update international partnerships to foster climate-resilient infrastructure for sustainable development.
Infrastructure for a Climate-Resilient Future
5. Making infrastructure climate resilient in developing countries
Abstract
Key policy insights
Developing countries are among the most vulnerable to the adverse impacts of climate change.
Developing countries differ deeply in terms of infrastructure gaps, developmental aspirations and vulnerability to climate change and natural disasters.
Some developing countries are particularly vulnerable and exposed to growing climate-related risks, notably Least Developed Countries and Small Island Developing States.
For developing countries, the imperative of climate-resilient infrastructure goes hand in hand with the need to close infrastructure gaps to sustain their industrialisation aspirations. This requires updating planning processes to ensure policy coherence and the integration of climate-resilience considerations across the spectrum of government policies – from infrastructure and innovation to trade, industry and investment policies.
Addressing social equity and inclusion is also paramount when planning climate-resilient infrastructure in developing countries. In these countries, even more than in advanced economies, vulnerable and marginalised communities often bear the brunt of climate impacts. They are disproportionately affected by inadequate infrastructure, hampering their economic inclusion prospects and perpetuating poverty cycles.
Making infrastructure climate resilient in developing countries calls for a “mindset shift” in domestic and international policies. Domestically, it requires identifying the hidden opportunities for local innovation arising from changing infrastructure design to address the specific needs of given locations, to participating actively in international forums to help develop emerging standards. Internationally, it requires defining new partnerships where developing countries are both emerging markets for investment and key partners to co-develop climate-resilient solutions for sustainable development.
Three areas stand out as critical for renewed forms of partnership between advanced and developing countries. These can ensure infrastructure is planned, built and operated in a forward-looking way in developing countries:
knowledge sharing and technical assistance in private and public sector capabilities, including on co‑operation and co‑ordination mechanisms; and updating of legal frameworks and development of prevention capacities, especially through enhanced tools and institutional capacities for risk and impact assessment
partnerships for research and development, deployment of technologies and tailored business solutions for climate-resilient infrastructure
increased investment and financing, and enhanced mobilisation of multilateral development banks and development finance institutions that also go beyond direct financing into areas such as project preparation support, screening and due diligence, financing and signalling, and de-risking of private sector investment.
5.1. Introduction
As the impacts of climate change intensify, the need for climate-resilient infrastructure has emerged as a critical priority (see Chapter 1). The escalating frequency and severity of climate-related events, such as extreme storms, floods, droughts and heatwaves, are placing unprecedented strain on infrastructure systems, including in transportation, energy, water and telecommunications. These infrastructures and their effective functioning are key for sustainable development. Making them climate resilient is therefore a shared priority for countries at all levels of economic development.
The imperative for climate-resilient infrastructure in developing countries is underscored by the disproportionate impact of climate change on these nations. These countries contribute the least to global greenhouse gas (GHG) emissions in per capita terms. Yet they often bear the brunt of climate-related disasters due to their geographical location, limited adaptive capacity and socio-economic vulnerabilities. Developing countries face unique challenges in adapting to the growing challenges posed by the climate crisis due to limited resources and inadequate infrastructure. In addition, the lack of resilient infrastructure hampers efforts to achieve the Sustainable Development Goals, perpetuating cycles of poverty and inequality.
Addressing these challenges necessitates a multifaceted approach that integrates climate resilience into infrastructure planning, design and implementation processes. Developing countries, in particular, must take proactive steps to update their national and local policies, business practices and social awareness.
Governments in developing countries must prioritise climate-resilient infrastructure in national and local development policies and strategies, integrating climate risk assessments, adaptation measures and community engagement into decision-making processes. Additionally, they need substantial support from the international community to enhance capacities to plan, finance, build and operate climate-resilient infrastructure. Investments, international partnerships, including financial assistance, technology transfer and capacity building, are indispensable.
This chapter focuses on the challenges, needs and aspirations of developing countries when it comes to climate-resilient infrastructure. In line with OECD good practices, it recognises the pressing need for strategic planning, project preparation, risk assessment and resilient construction practices, as well as maintenance and operational excellence. It identifies key areas for strengthened international co‑operation and partnerships to ensure that developing countries build climate-resilient infrastructure that can sustain economic development and industrialisation. The chapter recognises that developing countries are not monolithic; each has distinct needs. Some, including Least Developed Countries (LDCs) and Small Island Developing States (SIDS), are particularly at risk and in need of international support.
This chapter has three sections. First, it briefly discusses the growing impact of climate change and natural disasters in developing countries. Second, it focuses on specific challenges of developing countries to make infrastructure resilient in the face of climate change and natural disasters. Third, it examines local, national and international policy responses.
5.2. Climate change is taking a high toll on developing countries
Climate change is having increasingly severe impacts globally, and it disproportionately affects developing countries. More extreme weather events, such as hurricanes, floods and droughts, are taking place. Regardless of the different ways to measure economic impact, the toll of these events on developing countries is profound (see also Chapter 1). Globally, the number of reported natural disasters more than doubled during 2000-19 compared with the previous decade, with developing nations bearing a disproportionate burden (UNDRR, 2020[1]). The economic loss attributed to geophysical-, climate- and weather-related disasters is estimated to have averaged globally USD 170 billion per year over the past decade (UNDRR, 2022[2]).
Although developing countries contribute the least to global warming in per capita terms, they are the most vulnerable to climate change. Climate change is exacerbating the frequency and severity of natural disasters in developing countries. This amplifies existing vulnerabilities and increases the risk of disaster-related impacts.
Rising temperatures, changing precipitation patterns and rising sea levels contribute to more intense and frequent extreme weather events, such as storms, floods and droughts. Such events disproportionately affect developing countries. About 3.3-3.6 billion people live in regions with considerable development constraints and high vulnerability to climate change risks (IPCC, 2023[3]).
Climate resilience and resilience to natural disasters are closely connected in the case of developing countries due to several factors that exacerbate these countries’ vulnerabilities:
Geographical vulnerability: Many developing countries are located in regions prone to climate-related hazards. Coastal areas, for example, are susceptible to hurricanes and typhoons. Other areas are also prone to floods, droughts, hurricanes and heatwaves. All these events are exacerbated by climate change. Among developing countries, SIDS and LDCs are those most severely affected by climate change and natural disasters. Between 2000 and 2020, SIDS and LDCs had an average of 23 and 7 natural disasters per 1 000 square kilometres, respectively (Figure 5.1, panel A). This translates to between 10 and 30 times more disasters than experienced in OECD countries. Additionally, countries that are both SIDS and LDCs, such as Haiti and Solomon Islands, are even more affected as they tend to be geographically situated in disaster-prone regions (Figure 5.1, panel B). Other measures of vulnerability yield similar results. When it comes to floods, for instance, Bangladesh and Viet Nam have the highest shares of their population exposed to flooding – 58% and 46%, respectively (Figure 5.2) and (Box 5.1).
Economic vulnerability: Economic losses caused by climate change tend to be higher in high-income countries in absolute values. However, losses in lower-income countries are greater relative to their gross domestic product (GDP), with SIDS and LDCs the most affected within the developing world. Estimates show that high- and upper- middle-income countries lose between 0.1% and 0.3% of their annual national GDP due to climate change and natural disasters. However, low and lower middle-income countries lose on average between 0.8% and 1% of their national GDP to disasters per year (UNDRR, 2022[2]). SIDS represent two-thirds of the countries that suffer the highest relative negative impact of climate change on GDP. They are estimated to lose between 1-9% of their GDP per year due to climate change and natural disasters (OECD, 2023[8]).
Dependency on climate-sensitive sectors: Most developing countries rely heavily on climate-sensitive sectors such as agriculture, fisheries, forestry and tourism for livelihoods and economic development. Natural disasters, exacerbated by climate change, can devastate these sectors, leading to food insecurity, loss of income and economic instability. Consequently, the impacts of climate change pose significant threats to the livelihoods, well-being and economic development prospects of populations in developing countries. For instance, Hurricane Irma in 2017, the strongest hurricane recorded in the Caribbean to date, affected more than 1.2 million people in the region. It resulted in substantial economic losses, including the collapse of 80% of agricultural production in Haiti and neighbouring countries and territories (OECD, 2023[9]; 2023[10]). Some countries are advancing in increasing their planning and prevention capacities in the face of such disasters. Saint Lucia, for example, is a Caribbean island highly exposed to climate change and strongly dependent on tourism. It has improved its national policy for infrastructure resilience to climate change by setting up a National Integrated Planning and Programme Unit to elaborate the infrastructure agenda. The Unit oversees a comprehensive national infrastructure assessment that considers economic, environmental and social needs, as well as the potential impact of new infrastructure plans on the Paris Agreement targets (OECD, 2023[11]).
Limited access to climate information and early warning systems, and poor infrastructure: Most developing countries lack access to timely and accurate climate information and early warning systems (EWS), hindering their ability to prepare for and respond to natural disasters. They also have inadequate infrastructure and limited institutional capacity to address risks up-front and react to disasters. The high population density of the areas most affected by natural disasters induced by climate change further impedes effective disaster risk management and climate resilience efforts. This is particularly relevant in Africa where infrastructure is twice as vulnerable on average as it is in Latin America and in Asia, and five times as vulnerable as it is in Europe. This magnifies the social and economic impact of natural disasters in these areas (Figure 5.3).
Building resilience to climate change is crucial to ensure sustainable development pathways for developing countries. The pursuit of industrialisation and economic growth in these countries is driving growing demands and plans for infrastructure development, especially to support trade and production. Therefore, these new infrastructure investments must be planned, built and operated in a forward-looking and climate-resilient way. In addition, as these economies strive to achieve development, pursue growth and improve living standards, they tend to rely on energy-intensive industries that contribute to GHG emissions. This, in turn, aggravates their exposure to climate change. Therefore, investing in mitigation and adaptation measures to enhance resilience is critical both for climate risk management and sustainable industrialisation.
Box 5.1. Bangladesh needs to reduce its climate change vulnerability to sustain economic progress
Bangladesh, the biggest graduating LDC, is one of the countries most affected by natural disasters (Figure 5.4). Over 50% of Bangladesh’s land is less than 6 metres above sea level, and approximately 80% of its population is exposed to risks from extreme weather.
The high and increasing climate vulnerability of Bangladesh is exacerbated by rapid urbanisation, high population density and gaps in infrastructure, which compound with industrial and technological hazards. This leads to substantial economic losses in sectors like agriculture, logistics and manufacturing. Floods, driven by storms and heavy rainfall, frequently disrupt energy supplies, even with flood protection structures in place at thermal power plants. At the same time, they affect domestic agricultural production, while disrupting transport and logistics. The vulnerability to natural disasters increases business uncertainty and trade unpredictability, increasing the costs of investing and doing business in Bangladesh.
Easing vulnerability to climate change and natural disasters in Bangladesh is a human and an economic imperative that requires urgent attention to sustain future progress. To minimise the impact of climate change and consequent natural disasters on industrial development, Bangladesh needs to increase its prevention, reaction and re-building capacities. International partnerships are key in this respect. Bangladesh benefits from support from the International Monetary Fund under the Resilience and Sustainability Facility, Extended Fund Facility and Extended Credit Facility. These programmes address both immediate challenges, such as current account imbalances and reserve losses, and long-term structural concerns, including targeted domestic reforms to tackle climate vulnerability.
5.3. Developing countries need to close infrastructure gaps through the lens of climate resilience
Developing countries face significant infrastructure gaps in a range of sectors – from transport to energy, water and digital infrastructure. The gaps hinder their development prospects, international competitiveness and domestic industrialisation efforts. Closing these gaps is essential to unlock their economic potential, foster social inclusion and achieve sustainable development.
This chapter focuses on building climate resilience in competitiveness-related infrastructure (e.g. transport and digital networks, energy systems). Climate resilience plays a pivotal role in development strategies and in shaping the economic attractiveness and potential of a given location in national, regional and international markets. In addition, developing countries face growing pressures to build infrastructure assets to meet their industrialisation and job-rich development strategies. This calls for increased attention to ensure this new infrastructure is built in a forward-looking way. It must be able to withstand and minimise the impacts and risks associated with climate change and the growing frequency and impact of extreme weather events and natural disasters (Box 5.2).
Box 5.2. What is meant by competitiveness-related infrastructure?
Competitiveness-related infrastructure refers to assets, facilities and systems that have a direct effect on the economic performance and competitive capabilities of a given location. It includes transportation networks (roads, ports, airports, railways), energy facilities (power plants, grids), telecommunication networks and data centres.
Source: OECD (2024[6]), Compendium of Good Practices on Quality Infrastructure 2024: Building Resilience to Natural Disasters.
5.3.1. Significant gaps persist in competitiveness-related infrastructure in developing countries
Developing countries lag in terms of quality, coverage and access to digital infrastructure. In these countries, people and businesses suffer from lower speeds and relatively more unstable connections. For instance, Internet speed (fixed broadband) in Africa is nine times slower than in North America, which has the highest average speed of any region (Figure 5.5). Disparities are also profound between developing countries. Within Africa, Egypt has the fastest Internet; as of December 2023, its speed is 13 times faster than in Niger, which has the slowest Internet in the continent. It would take, for instance, 11 minutes to download a 5 gigabyte file in Egypt, versus 2.5 hours in Niger, and only 2 minutes in Chile, the country in the OECD with the fastest Internet (OECD, 2023[14]).
Developing countries continue to lag both in density and quality of transport infrastructure. Their needs for up-to-date and climate-resilient transport infrastructure are increasing. Population growth, urbanisation and the growth of logistics-intensive industries, including e-commerce, are increasing the need for inclusive, efficient and modernised transport infrastructure and logistics.
Adequate transport infrastructure, such as roads, ports and railways, improves connectivity within and between regions, facilitating the movement of goods, services and people. For example, the Mombasa-Nairobi Standard Gauge Railway in Kenya has enhanced connectivity between the port city of Mombasa and the capital of Nairobi, reducing transportation costs and facilitating trade. The expansion of port facilities in Viet Nam and Bangladesh has increased their capacity to handle international trade, supporting export-oriented industries and economic development.
Since developing countries are highly exposed to climate risks, they need to build climate resilience into their infrastructure. Despite some progress towards this goal, major gaps persist. For example, only 22% of rail lines were electrified in Africa (based on six countries: Morocco, South Africa, Democratic Republic of Congo, Algeria, Zimbabwe and Tunisia). By contrast, 65% and 56% of rail lines are electrified in Asia and Europe, respectively. In Latin America and the Caribbean, data are only available for Chile (39%) and Argentina (2%) (International Union of Railways, 2023[17]).
Moreover, infrastructure is increasingly needed in new areas to satisfy emerging demand. Mega-regional trade agreements have been signed, including the African Continental Free Trade Area (AfCFTA), the Regional Comprehensive Economic Partnership and the Comprehensive and Progressive Trans-Pacific Partnership. These agreements will shift the geography of supply chains. These changes, coupled by emerging geopolitical concerns such as the ongoing quest for critical minerals, are driving the growing need for infrastructure in new locations.
Developing countries also suffer from major energy infrastructure gaps. For instance, 36% of people on average in LDCs did not have access to electricity in 2021. Even when electricity is accessible, it is unreliable and unstable. For instance, power outages are much more common in developing countries, which has a major impact on industrial competitiveness. On average, firms in OECD member countries experience less than one power outage in a typical month. By contrast, the numbers of such outages are 7.1 in LDCs, 5 in SIDS and 3.5 in other developing countries. Developing renewable energy infrastructure can open significant opportunities for climate resilience, industrialisation and green growth in developing countries (Box 5.3).
Box 5.3. AfCFTA could be a game changer for innovative, renewable and climate-resilient energy infrastructure in Africa
Africa has some of the highest potential in renewables, which it could leverage to complement its energy resources. This could, in turn, become a springboard to develop industrial and innovation activities around renewables. In solar, for instance, Africa holds an estimated 60% of the world’s best resources but only 1% of installed photovoltaic capacity (IEA, 2022[18]). AfCFTA could be a game changer in this respect, provided it is matched with industrial strategies, large fiscal mobilisation and cross-border co-operation on standards.
AfCFTA increases the market for energy. So far, countries in Africa have been mostly trading electricity bilaterally. The five African Power Pools have varying levels of integration and have been hampered by a lack of infrastructure, along with regulatory mismatches and gaps (Odetayo and Walsh, 2021[19]). Other regional initiatives, such as the launch of the African Single Electricity Market in 2021, are also expected to build on the momentum of AfCFTA to create an operational continental electricity market.
AfCFTA has no special provisions for green goods. However, its Investment Protocol refers to fostering investment aligned with sustainable development, including mitigating and adapting to climate change.. Such provisions would complement the improved trade and better investment climate in the continent expected from the agreement. Ultimately, AfCFTA could help link industrialisation and the greening of the energy matrix. In this way, it could prove to be a lever for renewables.
African countries will need to take three key actions to take advantage of opportunities from AfCFTA:
Mobilise investments and link industrial strategies to the green transition. Large initiatives are needed that go beyond pilot and microgrid projects to stimulate demand and generate, in turn, the energy needed for green industrialisation on the continent. IEA (2022[18]) estimates that annual energy investments in Africa will need to double from their current levels to nearly USD 192 billion annually to meet the continent’s energy goals.
Advance on quality systems and certification for renewables. For example, certification for green hydrogen is at an early stage and mostly led by large consumer markets. Ensuring that African countries have a voice in the definition of such standards is critical. To that end, they must update their metrology and conformity assessment infrastructures to meet these standards.
Consider including green industrialisation to the AfCFTA agreement protocols in negotiations, such as those related to services (Asafu-Adjaye et al., 2021[20]).
Source: OECD (2023[14]), Production Transformation Policy Review of Egypt: Spotlight on the AfCFTA and Industrialisation, https://doi.org/10.1787/3ac95e0c-en.
Competitiveness-related infrastructure, including transportation networks, energy systems and water supply, are highly vulnerable to climate-related hazards, such as flooding, sea level rise and extreme weather events. The susceptibility of infrastructure assets to climate-related risks poses significant challenges to sustainable industrialisation and development. Their disruption compounds the challenges faced by developing nations, limiting their capacity to sustain economic competitiveness and growth. These challenges are compounded by the major human and social costs caused by the damage of infrastructure assets. By investing in climate resilience, these nations can mitigate the adverse impacts of climate change and promote sustainable industrialisation.
5.3.2. Addressing infrastructure gaps and ensuring climate resilience in infrastructure are twinned goals for developing countries
Tackling the two objectives simultaneously will allow developing countries to accelerate progress towards sustainable development and improve their competitiveness and capacity to capture value from the global marketplace. Existing infrastructure needs to be improved to ensure climate resilience. Meanwhile, new infrastructure needs to be built in a forward-looking way considering its climate resilience, as well as its capacity to mitigate climate change. Integrating climate resilience considerations into infrastructure planning, design, construction and operation in developing countries, as well as in advanced nations, is essential to ensure the longevity and effectiveness of infrastructure investments (see Chapter 2).
Moreover, resilient infrastructure can enhance the adaptive capacity of communities, facilitate economic resilience and reduce the socio-economic costs of climate-related disasters. In so doing, it can help reduce the persistent inequalities in developing countries. Enhancing the climate resilience of infrastructure will also reduce dependency on costly post-disaster recovery and reconstruction efforts, freeing up resources for long-term development priorities. This last consideration is of particular importance for developing countries that struggle to access finance and mobilise resources.
Integrating climate resilience into infrastructure development strategies in developing countries is a key component of sustainable development and forward-looking industrialisation strategies. It contributes to achieving critical objectives, including the following:
Supporting economic stability, by reducing the risk of infrastructure damage and disruptions from extreme weather events. This stability is crucial for attracting long-term investment and fostering sustained economic growth. Investors are more likely to commit resources to countries with resilient infrastructure that can withstand climate shocks, ensuring the continuity of operations and returns on investment.
Safeguarding critical assets and services, such as transportation networks, energy systems, water supply and telecommunications. For example, reinforcing coastal infrastructure, such as seawalls and flood barriers, protects ports and transportation routes from rising sea levels and storm surges, ensuring the uninterrupted flow of goods and services.
Minimising life-cycle costs by reducing the need for frequent repairs and emergency maintenance due to climate-related damages. By investing up-front in resilient design and construction techniques, developing countries can avoid costly retrofitting and reconstruction.
Reducing the risk premium. Insurance companies and risk assessors increasingly consider the resilience of infrastructure assets when underwriting policies and assessing risk exposure. By investing in climate-resilient infrastructure, developing countries can reduce insurance premiums and financial liabilities associated with climate-related risks.
Fostering innovation and technological development. Prioritising resilience to climate change in infrastructure drives the development of new materials, design approaches and construction techniques that enhance resilience. This fosters a culture of innovation and entrepreneurship, creating opportunities for the growth of local industries and adoption of cutting-edge technologies in infrastructure development. Climate-resilient infrastructure also preserves ecosystems as wetlands, forests and natural waterways by integrating Nature-based Solutions into infrastructure design, including green roofs, permeable pavements and natural drainage systems. In this way, it fosters bioeconomy development and generation of sustainable economic value from natural assets (see Chapter 4).
Increasing integration and partnerships with global markets. Adhering to international standards, regulations and agreements to address climate change and promote sustainable development enhances credibility and reputation on the global stage. This, in turn, supports access to international financing, partnerships and co‑operation.
5.4. Updated national policies and international partnerships will be key to ensure progress
The infrastructure gaps outlined in the previous section are not new. Developing countries have long suffered from historical underinvestment and poor infrastructure development. However, it is becoming more urgent for them to close these gaps or risk falling further behind. Developing countries are increasingly exposed and vulnerable to climate change and natural disasters. Their aspirations for industrialisation compel them to boost infrastructure investment and ensure climate resilience. Indeed, advanced countries are prioritising modernisation and upgrading of infrastructure. By prioritising climate resilience, they are preparing for the green and digital economy. Yet their actions risk perpetuating gaps between advanced and developing countries. To avoid falling further behind, developing countries need to mobilise adequate investments.
Investments in infrastructure in developing countries also support the global economy. Major infrastructure gaps in developing countries directly influence global economic performance through their impact on supply chain security, resilience and stability. This means infrastructure upgrading in developing countries also benefits advanced economies.
Box 5.4. Guiding policy actions to make infrastructure resilient to natural disasters: A three-pillar framework
The Compendium of Good Practices on Quality Infrastructure 2024: Building Resilience to Natural Disasters presents actionable principles to ensure infrastructure resilience to natural disasters. It draws from global good practices and in-depth analyses of infrastructure projects in Colombia, Ghana, India, Indonesia, Japan, Mozambique and the United States. It presents a three-pillar framework to guide policy actions and foster implementation of the G20 Principles for Quality Infrastructure Investment (G20, 2019[21]). Three distinctive and interconnected areas state the importance of developing national and local government capacities:
Preventing: This area is linked to actions, tools and physical characteristics of the infrastructure that enable damage prevention and/or minimisation. This includes cost-benefit analysis, disaster risk assessments from the early stage, disaster risk management, early warning systems, social safety nets and strategic preventive maintenance, as well as structural measures and new designs such as construction of levees for flooding.
Reacting: This area is linked to the actions taken and tools used in response to a natural disaster to restore operational capacity and mitigate service provision disruption. It provides short-term countermeasures such as alternative infrastructure options and services. This also includes regulatory and economic instruments that help implement disaster risk management in a timely manner. Access to emergency finance, for example, can support swift recovery of social and economic functions and services. This could minimise the severity and duration of disruption.
Re-building: This area is linked to actions, tools and plans, including changes in the physical characteristics of the infrastructure. These shape how the disrupted infrastructure is rebuilt in effective, efficient and forward-looking ways, considering shifts of economic, environmental and social demands over time. Re-building encompasses deployment of advanced, efficient and low-emission technologies, and changes to infrastructure design and access. It also involves protecting and restoring ecosystems, and engaging stakeholders. This allows for transformative economic growth and strengthens competitiveness, while ensuring environmental sustainability and inclusivity. Including climate resilience criteria in re-building actions is essential to reduce climate vulnerability.
Developing countries need to strengthen their capacities to ensure infrastructure is resilient in the face of climate and natural disasters. National and local governments need to reinforce capacities in three main areas: prevention, reaction and re-building. They need to update the regulatory framework, identify appropriate financing mechanisms and funding sources; define effective measurement and monitoring systems; and identify appropriate consultation mechanisms for stakeholders to guide actions in each of the three phases (Box 5.4).
5.4.1. The regulatory framework for infrastructure projects should take into account climate resilience
This section discusses the relevance of international good practices and presents concrete cases based on the experience of developing countries. It focuses on four areas where significant improvements are needed in developing countries: the regulatory framework; the role of development banks; innovation and technological capabilities; and government co‑ordination and implementation capacities.
The regulatory framework plays a crucial role in ensuring climate-resilient infrastructure in developing countries. To that end, it provides the necessary policies, standards and guidelines to ensure infrastructure investments are aligned with climate adaptation and mitigation goals.
It is essential that developing countries participate in the definition of global climate resilience standards for infrastructure. These are norms, codes and guidelines that govern the design, construction and operation of infrastructure projects. They define the minimum requirements for infrastructure resilience, including considerations such as climate risk assessments, adaptive design strategies, durability and maintenance.
Box 5.5. India has adopted a life-cycle approach to infrastructure that increased resilience to natural disasters in its highway projects
India has implemented measures to ensure its highway projects are resilient to natural disasters at all stages of the process – from planning and design through construction, operation, maintenance and end-of-life.
In the planning phase, a risk assessment encompasses the lifespan of assets. India studies an area’s topology, geography and hydrology to avoid higher-risk areas or else ensure that mitigation systems can match the risks effectively. Additionally, it uses disaster exposure mapping (e.g. earthquakes) to determine areas requiring specific levels of investment to mitigate different types of disaster.
During the construction phase, India opts for tailored structural features such as flexible pavements, reinforced embankments, retaining walls and proper drainage systems. The country has also incentivised use of high-quality and tested materials, such as high-strength concrete, to ensure the durability and resilience of its highway projects.
India mandates regular preventive maintenance and inspections to uphold the integrity of infrastructure assets. It established disaster management plans, outlining response measures and evacuation routes in advance to expedite emergency response. Additionally, India has implemented an automatic traffic management system to help emergency responders act more quickly during natural disasters.
Source: OECD (2024[6]), Compendium of Good Practices on Quality Infrastructure 2024: Building Resilience to Natural Disasters.
The regulatory framework mandates the inclusion of climate risk assessments in the planning and design of infrastructure projects. This involves evaluating the potential climate-related hazards, vulnerabilities and impacts that infrastructure assets may face over their life cycle. Climate risk assessments inform decision-making processes, helping identify suitable adaptation measures and design strategies to enhance the resilience of infrastructure projects against climate change impacts.
The regulatory framework can incentivise climate-resilient infrastructure investments through various mechanisms, such as tax incentives, subsidies, grants and preferential financing terms. Through financial incentives for climate resilience, governments encourage developers, investors and infrastructure operators to prioritise resilient design, construction and maintenance practices. Incentivising climate resilience helps overcome market barriers and fosters a conducive environment for sustainable infrastructure development.
The regulatory framework should also ensure and enforce compliance with climate resilience standards and requirements through monitoring, inspection and enforcement mechanisms. Regulatory authorities oversee implementation of climate resilience measures in infrastructure projects, ensuring that developers and operators adhere to prescribed standards and guidelines. Non-compliance may result in penalties, fines or project delays, incentivising stakeholders to prioritise climate resilience in infrastructure development. It is important to clarify responsibilities in terms of who conducts the risk assessment and who follows up with necessary actions. Failure to do this could undermine the value of the risk assessment.
Increasing government anticipation and adaptation capacities is key to ensure resilience in the face of climate and natural disasters. The regulatory framework must be adapted as needed, while ensuring stability and security of economic operations.
Box 5.6. Monitoring and measuring disasters impact is key for better prevention, reaction and re-building: The experience of Mozambique
In Mozambique, the national road network faces significant exposure to natural hazards, particularly flooding and cyclones. With 40% of the country situated less than 200 metres above sea level and a coastline stretching over 3 000 kilometres, Mozambique is vulnerable to the impacts of intense rainfall and frequent cyclones. Historically, reliance on outdated data for preventive measures, such as building embankments, has proven insufficient in mitigating the risks exacerbated by climate change. This has led to more vulnerability.
To address these challenges, Mozambique has identified risks and hazards in collaboration with the National Meteorological Institute and the development of hazard maps. By using new data and spatial forecasting techniques, the country has pinpointed areas most at risk and prepared direct response actions accordingly. Additionally, new design standards were implemented in 2019 through reforms of the legal framework. These introduced measures such as changing slopes, cutting trees and constructing embankments to enhance road resilience and reduce vulnerability to natural disasters.
Source: OECD (2024[6]), Compendium of Good Practices on Quality Infrastructure 2024: Building Resilience to Natural Disasters.
5.4.2. Development banks should step up to close infrastructure gaps and ensure climate resilience
Development banks – multilateral development banks (MDBs), development finance institutions (DFIs) and national development banks – are key partners to close infrastructure gaps in developing countries and addressing climate resilience. By leveraging their resources and expertise, development banks can complement other sources of financing, including from the private sector. In so doing, they help countries build climate-resilient infrastructure, foster sustainable development and improve the resilience of communities to future climate risks (see Chapter 3).
To fully perform their role as an enhancer of climate-resilient infrastructure in developing countries, development banks would benefit from more capital. In developing countries, the role of international and national development banks for climate-resilient infrastructure comprises the following five areas:
Financial support: Development banks provide financing for climate-resilient infrastructure projects in developing countries through a variety of instruments, including loans, grants and guarantees. They often offer concessional terms and flexible financing options to support projects that incorporate climate resilience measures, such as climate risk assessments, adaptation strategies and resilience-enhancing technologies. Additionally, development banks can leverage their financial resources to attract co-financing from other sources, including the private sector and international climate finance mechanisms.
Technical assistance and capacity building: Development banks offer technical assistance and capacity building support to enhance the readiness and implementation of climate-resilient infrastructure projects. They also actively structure and prepare infrastructure projects, which includes providing technical expertise in climate risk assessments, engineering design, project management, and monitoring and evaluation. Development banks also facilitate knowledge exchange and sharing of best practices among countries facing similar climate challenges. This helps build local capacity and expertise in climate-resilient infrastructure development.
Policy and regulatory support: Development banks play a crucial role in shaping policy and regulatory frameworks that promote climate-resilient infrastructure development. They work closely with governments to strengthen regulatory standards, codes and guidelines related to climate resilience in infrastructure planning, design and construction. Development banks also advocate for policy reforms that incentivise investment in climate-resilient infrastructure and integrate climate risk considerations into national development strategies and sectoral plans.
Project screening and due diligence: Development banks conduct rigorous screening and due diligence processes to ensure that infrastructure projects under consideration are climate resilient and environmentally sustainable. This includes assessing climate risks and vulnerabilities, evaluating the resilience of proposed infrastructure designs and technologies, and considering long-term climate impacts and adaptation strategies. Development banks also incorporate climate resilience criteria into project appraisal and approval processes, guiding investment decisions towards projects that enhance resilience and reduce vulnerability to climate change.
Knowledge sharing and innovation: Development banks facilitate knowledge sharing and innovation in climate-resilient infrastructure by supporting research, pilot projects and knowledge exchange platforms. They invest in research and development of innovative technologies and approaches that enhance climate resilience in infrastructure, such as green infrastructure, Nature-based Solutions and resilient urban planning. Development banks also promote learning and capacity building through workshops, seminars and conferences, fostering a culture of innovation and continuous improvement in climate-resilient infrastructure development.
5.4.3. Innovation and technology are pivotal to strengthen disasters’ prevention and reaction capacities
Innovation, and traditional and digital technologies can be important allies in strengthening prevention and reaction capacities of developing countries.
Developing countries have limited capacities in the use of EWS and Multi-Hazard Early Warning System (MHEWS). MHEWS, which address multiple hazards simultaneously, are key to increase countries’ prevention capacities. Only 11 LDCs have a MHEWS in place, and EWS covers only 46 of 100 people. In terms of regions, South America has the lowest share of countries reporting having a MHEWS (25%), followed by Africa (30%) (Figure 5.8).
Innovative technologies can further maximise investments in EWS infrastructure. For instance, AI help develop EWS for extreme weather events, enabling communities to prepare for them and respond effectively. In particular, they can help identify and assess vulnerabilities in communities and infrastructure, provide real-time information on weather patterns, and improve the accuracy and precision of climate models, allowing for more effective policy responses (Jain et al., 2023[22]).
Despite the persistent gaps in this area, some progress has been made. For example, Mozambique has an EWS that enables the country to track potential hazards, issue timely alerts and act to minimise the impacts on people's lives and property. This system integrates new technology, infrastructure and community action to ensure effective communication and response.
Two key institutions ensure the effective functioning of the national EWS. The National Meteorology Institute (INAM) uses satellite imagery, radar data and observations from a network of monitoring stations to produce meteorological warnings. For its part, the Institute of Social Communication disseminates alerts through its network of 70 community radios. Additionally, trained community brigades are mobilised to warn at-risk communities, guiding them to safety before extreme weather events occur (OECD, 2024[6]).
Box 5.7. Re-building effectively through technology and international partnerships: The case of Ghana
In response to the pressing need for a power substation adjacent to Accra’s thriving commercial hub, Ghana faced a dual challenge of land scarcity and heightened flood risk in available areas. To overcome this hurdle, a bulk supply point was built in a flood-prone area in the central business district. As a result, the area is able both to react to an emergency and to increase preparedness. Through international co‑operation, technology adoption and capacity building, the project increased energy supply and strengthened the resilience of energy infrastructure to flooding.
Ghana has received substantial support for climate resilience from the Japan International Cooperation Agency (JICA). JICA provided a JPY 4.2 billion grant [about EUR 38.5 million] to build and retrofit the substation. In collaboration with the Ghanaian government, Mitsubishi took charge of construction and retrofitting, leveraging innovative technology and methods to minimise disruptions to commercial activities. These efforts included use of underground drills and installation of crucial flood and disaster mitigation technologies such as automated pumps and fire-resistant walls. These measures helped both to build the station and to mitigate the impact of subsequent floods, ensuring uninterrupted power supply to the commercial hub.
Technology transfer was integral to success, alongside well-planned operation and maintenance strategies executed by a team of well-trained and skilled staff. Thorough understanding of flood risks and meticulous project planning were pivotal to ensure effective mitigation strategies. The construction of the facility was carried out by a joint venture: Mitsubishi Corporation (a Japanese trading house), Hitachi Plant Construction (a Japanese plant construction company) and Yurtec (a Japanese electricity facility and engineering company). Leveraging their superior technology, diverse experience and project management capabilities, these companies played a pivotal role in the successful execution of the project. Collaboration among private providers and the construction company involved also contributed to success.
The project was implemented with significant support from the Ghanaian government through various agencies, including the Ghanaian government through various agencies including the Ministry of Energy, the Ministry of Finance, the Energy Commission, the Electricity Company of Ghana, Ghana Railway, Ghana Water. With their collaboration, the project was able to commence construction of the substation. Cutting-edge technology was also employed for advanced monitoring, real-time data analytics, and predictive capabilities, ensuring efficient operation and maintenance. In addition, it integrated advanced technologies to enable operations with minimal disruption during maintenance.
The project's impact assessment revealed remarkable successes, with a 95% reduction in the rate of power shortages compared to 2013. Despite facing two major floods in 2020 and 2022, the substation remained resilient, experiencing no disruptions to its operations. This resilience underscores the efficacy of the implemented flood mitigation strategies, including use of automated pumps and other technological innovations. Japan's significant support, coupled with Ghana's collaborative efforts, exemplifies the benefits of international co‑operation and the strategic integration of cutting-edge technology in bolstering infrastructure resilience against natural disasters.
Source: OECD (2024[6]), Compendium of Good Practices on Quality Infrastructure 2024: Building Resilience to Natural Disasters.
Developing countries need to shift from a “technology transfer” to a “co-creation” mindset. In this way, they can foster innovative local and international partnerships to co-develop climate-resilient solutions. Developing countries lag in innovation and technological capabilities in most areas, including climate resilience. The top 20 countries for patent applications for climate change adaptation technologies accounted for 92% of the total.
Despite the notable rise in the share of these patents held in the People’s Republic of China [hereafter “China”] and India, OECD countries lead in total number. Since the 2000s, the share of these patents in China rose from 1% to 17%. For its part, India accounts for 2% of the world total. Meanwhile, OECD countries accounted for 75% of the world total in 2019-21 [authors’ elaboration with data from OECD (2022[24])]. Partnerships between developed and developing countries in this field is essential. It allows developing countries to increase their adaptation capacities and also enhances the global capacity to respond to climate change.
5.4.4. Improving governance and institutional capabilities will be essential to support climate-resilient infrastructure
Developing countries need to improve their governance and institutional capabilities to plan, build and manage infrastructure effectively, and to ensure they proceed in a climate-resilient way.
Inclusive processes to engage stakeholders can be key for ensuring infrastructure is planned, built and operated in a climate-resilient way. This involves creating mechanisms for public consultation, community involvement and stakeholder collaboration. Together, they ensure that infrastructure projects address the needs, concerns and priorities of local communities and vulnerable groups (see Chapter 2).
Enhancing governance and institutional capacities of national and local governments is essential as they play an important role in implementing innovative policies to make infrastructure climate resilient. Equipping people in the public and private sectors with adequate technical skills is crucial. For example, in Ghana, the Ministry of Roads and Highways has prioritised capacity building for staff, equipping them with the skills to carry out their responsibilities effectively. Newly recruited technical staff within the agencies undergo mandatory in-house training; this training ensures that all staff, regardless of academic background, are well prepared for their roles. Additionally, development partners such as the Japanese Development Cooperation Agency and the African Development Bank play significant roles in supporting Ghana's training programmes, as well as providing concessionary facilities for road projects.
It is important to pay attention to capacity building and community empowerment at the local level (OECD, 2024[6]). Local authorities are close to the ground, and able to understand the reality of growing climate change in their communities. From this vantage point, and by prioritising a system approach in policy reforms, they are key players in mitigating the impact of climate change on infrastructure. However, local communities in developing countries, especially in LCDs, face a severe shortage of fiscal and technical capacities. Targeted actions are needed to empower them and leverage their capacities to ensure climate-resilient infrastructure (SNG-WOFI, OECD-UCLG, 2022[25]) (Chapter 6).
Enabling cross-border collaboration at the national and local level is also essential. Geological interconnections cross national frontiers. This requires the creation of mechanisms for joint data collection and use, and for joint planning. In this way, neighbouring countries can factor the cross-border impact of climate change and natural disasters into national responses. In the context of Mozambique's interconnected hydrographic basins, for example, cross-border issues must be considered when developing infrastructure resilience to natural disasters. The interconnected nature of hydrographic basins means that activities upstream can have significant downstream impacts, including the potential for increased flood risks and changes in water flow patterns. Therefore, effective co‑ordination and collaboration with neighbouring countries are essential to address shared challenges and mitigate the transboundary impacts of natural disasters (OECD, 2024[6]).
Box 5.8. Knowledge management and impact assessment in the aftermath of disasters increases future prevention capacities: The experience of Indonesia
Addressing Indonesia's vulnerability to natural disasters requires a multifaceted approach. It should encompass robust disaster preparedness, early warning systems, infrastructure resilience and community engagement. Enhancing the resilience infrastructure is imperative to support Indonesia’s development efforts. Strengthening building codes, implementing land-use planning measures and investing in resilient infrastructure are critical steps towards mitigating the impacts of disasters. Furthermore, enhancing public awareness and community resilience through education and capacity-building initiatives helps foster a culture of preparedness and response at the grassroots level.
In Indonesia, the Jakarta metropolitan area deserves special attention. As Indonesia's capital and one of the most populous urban centres in Southeast Asia, the area faces unique challenges and vulnerabilities related to natural disasters. Situated on the northwest coast of Java Island, Jakarta is particularly susceptible to a combination of geological, hydro-meteorological and environmental hazards.
The Jakarta Mass Rapid Transit (MRT) project aimed to mitigate traffic congestion in the metropolitan area, while addressing disaster risks such as heavy rainfall, floods, land subsidence, sea level rise and earthquakes. Underground facilities were redesigned, including rain screens, flood panels and mount-up entrance that prevented flooding water from flowing into underground stations. These actions helped reduce impacts of weather-related events. In addition, the local government released reports on flood prevention and organised awareness-raising events to alert and prepare the population.
The Disaster Prevention Policy aimed to ensure safe evacuation of passengers during emergencies, focusing on MRT Jakarta. A crucial success factor was the emphasis on building knowledge, skills and capacities throughout planning and construction. These activities prioritised resilience to natural disasters.
MRT Jakarta actively engaged in capturing, disseminating and reusing knowledge gained from firsthand experiences to enhance its practices. The project organised retrospective events to discuss the initial phase, compiling valuable lessons learnt at its Internal Knowledge, Information, Education Center. Additionally, MRT Jakarta published a series of books covering construction, and operation and maintenance aspects, providing valuable insights for future projects.
Furthermore, MRT Jakarta played a significant role in a study on flood management by the Community of Metros Benchmarking Group (COMET). This initiative resulted in a comprehensive benchmarking report among all COMET members, allowing metros to compare flood management practices and learn from each other. By actively participating in knowledge-sharing platforms like COMET, MRT Jakarta contributed to the collective learning and improvement of flood management practices in metro systems.
Source: OECD (2024[6]), Compendium of Good Practices on Quality Infrastructure 2024: Building Resilience to Natural Disasters.
Developing countries will need to invest in closing their infrastructure gaps in a way that is environmentally sustainable, minimises risks from climate change and turns infrastructure into an accelerator of economic and social transformation. This will demand a transformative agenda that links infrastructure development to national aspirations for industrialisation and innovation. It will also require international partnerships for resource mobilisation, innovation and collaboration.
5.5. Conclusions
The urgency for global and national action on climate-resilient infrastructure in developing countries cannot be overstated. The consequences of inaction are dire, with the most vulnerable countries and communities bearing the greatest burden. For developing countries, the imperative of infrastructure resilient to climate and natural disasters goes hand in hand with the need to close infrastructure gaps to sustain countries’ aspirations of industrialisation.
Five policy issues are of paramount importance:
There is a pressing need to build capacities for comprehensive risk assessments to inform infrastructure planning and decision-making processes in developing countries. These assessments should incorporate climate projections, vulnerability assessments and socio-economic factors to identify areas of high risk and prioritise adaptation interventions. Additionally, integrating climate resilience into infrastructure design and construction standards is essential to ensure that new infrastructure investments are resilient to future climate impacts.
Enhancing institutional capacity and governance frameworks is crucial for effective climate- resilient infrastructure development. This includes strengthening regulatory frameworks, improving co‑ordination among government agencies, fostering multi-stakeholder partnerships, supporting subnational governments and enhancing community engagement in decisions. Building institutional capacity is essential to ensure effective implementation and maintenance of climate-resilient infrastructure projects. Capacity building in improving and updating the regulatory framework is also important in developing countries to ensure that rules and standards incentivise resilience across the whole project life cycle, integrate climate risk assessments, enforce compliance and facilitate stakeholder engagement.
Financing mechanisms must be mobilised to support climate-resilient infrastructure in developing countries. This includes both public and private sector investment, as well as leveraging international climate finance mechanisms such as the Green Climate Fund and the Adaptation Fund. Innovative financing mechanisms, such as climate bonds and public-private partnerships, can also play a key role in mobilising resources for climate-resilient infrastructure projects, including at the subnational level (see Chapter 6). Governments, national development banks, as well as MDBs and DFIs, are key players in this field. They are crucial for financing, technical assistance and capacity building, de-risking investments and attracting private investments (see Chapter 3). To meet the growing infrastructure needs in developing countries and to ensure that infrastructure is resilient against climate and natural disasters, it will be important to increase the capitalisation of MDBs and DFIs so they can meet the growing demand.
Technology transfer, co-development of innovative solutions and capacity building are critical for enhancing the technical expertise and knowledge needed to implement climate-resilient infrastructure projects. This includes transferring climate-resilient technologies, building local capacity for project design and implementation, and fostering knowledge exchange among countries facing similar climate challenges. Investing in research and development of climate- resilient technologies tailored to the specific needs of developing countries is also essential.
Addressing social equity and inclusion considerations is also paramount in climate-resilient infrastructure in developing countries. Vulnerable and marginalised communities often bear the brunt of climate impacts, which affect them disproportionately because of inadequate infrastructure. This also hampers their economic inclusion prospects, therefore perpetuating poverty cycles. Climate-resilient infrastructure projects must be designed and implemented in a way that promotes social equity, ensures access to essential services for all and empowers local communities to actively participate in decision-making processes.
Developing countries can build the necessary competitiveness-related infrastructure that is resilient to the impacts of climate change, fosters sustainable development and improves the resilience of communities to future climate risks. To that end, they must prioritise risk assessments, enhance institutional capacity, mobilise financing, promote technology transfer and capacity building, and consider social equity.
Governments in developing countries need to take a proactive stance towards climate-resilient infrastructure and prioritise it as part of their industrialisation and competitiveness efforts. The private sector and the international community should step up and support them with adequate means. Now is the time for shared and decisive action to build a world more resilient to climate and natural disasters, leaving no one behind.
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