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Farmers will undertake many adaptation actions to meet changing climate conditions and will often do so without any government intervention. However, when such actions provide both private and public benefits, the public sector may play a role in how these are developed. This report aims to establish a framework to help identify specific actions that governments could take in this respect and that could avoid sending signals leading to non-adaptation or maladaptation. This report begins with a review of national adaptation strategies for the agricultural sector in OECD countries and highlights different approaches undertaken by governments. It then identifies the main criteria under which governments may take action to increase the resilience of the agricultural sector and its adaptive capacity to climate change. Finally, it discusses strategies to monitor and evaluate adaptation policies.

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An important source of political opposition to measures aimed at reducing emissions of greenhouse gases (GHGs) arises from concerns over their negative effects on the competitiveness of domestic firms, especially those that are energy-intensive and exposed to competition from foreign producers. Politicians and industry representatives alike fear that imports from countries without similar regulations can gain cost-of-production advantages over domestic goods. With many of the major economies of the world contemplating unilateral action to restrict their carbon emissions (while continuing to pursue co-ordinated multilateral action), the parallel concern of carbon leakage — whereby domestic reductions in emissions are partially or wholly counterbalanced by increased emissions elsewhere in the world — has also arisen. Various adjustments have been proposed, both in the academic literature and in draft climate legislation, including levying a border tax or requiring importers to surrender a quantity of carbon permits. Collectively, these kinds of adjustments are often referred to as border carbon adjustments, or BCAs. This note reviews the existing literature on BCAs and alternatives to BCAs and discusses what various researchers have concluded about the efficacy of BCAs from both a trade and an environmental perspective.

Environment --- Trade

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This paper investigates how climate change can affect agricultural production and proposes some adaptation measures that could be undertaken to mitigate the negative effects of climate change while enhancing the positive ones. The paper stresses the importance of planned adaptation measures and highlights possible strategies for reducing risk and improving resilience. To quantify the possible effects of climate change and the effects of adaptation measures this study uses the International Model for Policy Analysis of Agricultural Commodities and Trade (IMPACT). The analysis first explores the potential effects of climate change on yields and prices. It then goes on to analyse the potential impacts of two distinctive sets of adaptation strategies on yields, prices, and food security, namely: i) research and development (to develop new crop varieties that are better suited to changed climate conditions) and ii) changes in irrigation technology. Last, the analysis in this paper estimates the public and private investment needs in research and development (R&D) for developing new crop varieties, and further develops estimates of the cost of improving irrigation technologies in OECD countries.

Agriculture and Food --- Environment

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This paper investigates how climate change can affect agricultural production and proposes some adaptation measures that could be undertaken to mitigate the negative effects of climate change while enhancing the positive ones. The paper stresses the importance of planned adaptation measures and highlights possible strategies for reducing risk and improving resilience. To quantify the possible effects of climate change and the effects of adaptation measures this study uses the International Model for Policy Analysis of Agricultural Commodities and Trade (IMPACT). The analysis first explores the potential effects of climate change on yields and prices. It then goes on to analyse the potential impacts of two distinctive sets of adaptation strategies on yields, prices, and food security, namely: i) research and development (to develop new crop varieties that are better suited to changed climate conditions) and ii) changes in irrigation technology. Last, the analysis in this paper estimates the public and private investment needs in research and development (R&D) for developing new crop varieties, and further develops estimates of the cost of improving irrigation technologies in OECD countries.

Agriculture and Food --- Environment

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This paper examines the impact of the harsh 2012 winter on livestock herding households in Kyrgyzstan and identifies policy options to increase household resilience to such shocks. While existing studies mostly focus on rainfall shocks in tropical or dry climate areas, this analysis examines the exceptionally harsh winter that hit Kyrgyzstan in 2012, which resulted in the death of 25 000 animals. Using a unique household panel survey, merged with observed temperature data, the analysis finds that, on average, the negative effects of the winter shock on household welfare are significant and persistent over time, leading to a 5 percent and a 8 percent decrease in households’ food consumption expenditure in the short- (2011–2013) and medium-run (2011–2016), respectively. When disaggregating by income quantiles, the evidence shows that negative impact is concentrated in the upper quantiles of the welfare distribution. Several policy options are identified as effective in mitigating the negative welfare impacts of the weather shock. First, supporting households to restock their herds following weather shocks is found to significantly improve medium-term welfare by 10 percent relative to those that did not restock. Restocking efforts can be addressed in a holistic manner that takes into account immediate household needs, while simultaneously building long-term resilience in the livestock sector. This may include mitigating animal losses through the development of local forage markets that increase the availability of winter forage, combined with efforts to improve the genetic pool of livestock species through breeding programmes that select for resiliency traits. Second, results show that households living in regions with higher access to public veterinary services had significantly better welfare outcomes following the winter shock. Improvements of veterinary services and strengthening community-based organizations focusing on livestock and pasture development may help herding households to cope with weather shocks.