Monday, January 20, 2014

Budgeting for climate essential in Zimbabwe

Jeffery Gogo in via the Herald (Zimbabwe): Zimbabwe last year invested US$326 million in capital assets across the public sector, accounting for just 9 percent of Government's total expenditures. Capital expenditures by the private sector will be much bigger, but figures are not immediately available. However, Government's capital investments in recent years have fallen far below its own long-term target of 14,6 percent of cumulative expenditures, as indicated under the Public Sector Investment Programme (PSIP), an infrastructure development initiative.

The international best practice of capex as a percentage of total expenditures is 30. These financial investments face greater risk from extreme climate and weather events such as tropical cyclones, which have increased in frequency during the last 15 years, causing manifold damage to property and public infrastructure.

Climate change and variability usually impacts directly on capital investments, leading to deep and widespread losses, degradation or destruction of key infrastructure, disruption of supply chains and can lead to serious changes in the availability of important natural resources, according to new research by the American Meteorological Society's Policy Programme.

"Even small changes in weather can impact operations in critical economic sectors," said the Society. "As a result, maximising returns on financial investments depends on accurately understanding and effectively accounting for these risks."...

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