What Conditions are Needed in order to Make Laws and Policies to Have an

As explained in the previous section (7.3.9), improving the business environment and people’s understanding of climate change could enhance climate finance activities.

Greater inter-agency coordination at different levels should be prioritised as the analysis provided in 7.3.9 implied that in order to improve access to climate finance in the country, there would be a need to improve the investability of the renewable energy sector and also the investability of a spectrum of infrastructure and other sectors such as roads, communication systems and vocational training.

M19 and M25 highlighted that inter-departmental coordination was a major problem for both renewable energy and climate change issues as officers from different departments preferred to concentrate on specific tasks within their departmental mandates. Among some of the justifications to develop a climate change policy in Malawi was the need to overcome the disintegrated and overlapping sectoral mandates that did not clearly define roles and responsibilities of stakeholders; and the need to eliminate the piecemeal introduction of new institutional and management frameworks for climate change which had resulted in conflicts of institutional mandates, responsibilities and confusion in coordination and leadership in climate change issues in the country (GoM, 2012c). It therefore has to be seen if the climate change policy that will be developed in Malawi will address the twin challenges identified above by simultaneously addressing

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socio-economic and environmental climate change issues, and business and investment issues that can attract climate finance.

Malawi developed the National Environment and Climate Change Communication Strategy (GoM, 2012d) in 2012 in order to provide insight into issues, concerns and opportunities to improve communication on environmental and climate change issues.

The Strategy was launched in response to the realisation that despite the immensity of climate change impacts and various response measures being taken, few people in the country appreciated the causes, impacts and consequences of environmental degradation and climate change and how that linked to national development. As stated in Chapter 7.2.9, most Malawians associated climate change with variations in rainfall patterns.⁵⁹ In order to reach out to different stakeholders, the communication strategy suggested the use of different channels to engage various stakeholders (e.g. print media, electronic media, help-lines and interactive programmes, social marketing, and advertising, etc.). However, M17, M18 and M22 highlighted that producing materials and reaching out to most rural communities was problematic due to funding shortfalls and poor infrastructure (roads) in rural areas. Climate change awareness and management was therefore still being constrained since the National Environment and Climate Change Communication Strategy just highlighted issues constraining climate change awareness and how they could be minimised but did not put an action plan and budget to realise the objectives. Arguably, improved awareness of climate change is important in many dimensions as it can improve the engagement of people in environmental activities and also influence behaviour changes. As explained Chapter 3.3.5 (Malawi’s Intended Nationally Determined Contributions (INDCs)), Malawi is experiencing rampant deforestation and this reduces the sequestration potential of the country, and promotes soil erosion and flooding. Improved knowledge and awareness of climate change causes, mitigation actions, adaptation strategies and how deforestation increases climate change vulnerability might therefore empower communities to enhance their conservation of trees and forests, and businesses to consider funding and sponsoring

59 In actual fact, as elaborated by M11, at national level, the data collected suggests that temperatures in Malawi have risen by 0.8% since 1960 whilst the rainfall amount has not changed (but the country is experiencing delayed onsets of rainfall and prolonged dry spells within seasons are higher).

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ventures that can promote the use of alternative energy sources/renewable energy and afforestation/reforestation initiatives.

7.3.11 Is There a Need for Other Supporting Frameworks and Institutions to Improve Access to Climate Finance in Malawi? / Is There a Need for Other Supporting Frameworks and Institutions to Improve the Implementation of Energy Related Climate Finance Projects?

M10, M13 and M26 considered Climate finance (CDM) transactions costs to be high and that there was little expertise on climate finance in the country (i.e. consultants to develop projects and/or to audit and evaluate projects) which further increased project costs. Access to climate finance and implementation of energy climate finance projects could therefore greatly benefit from the introduction of supporting frameworks and new institutions to reduce cost and technical barriers related to climate finance projects. As explained in Chapter 7.3.9, some of the countries that had progressed in the climate finance arena had supporting institutions in addition to the DNA. Climate Finance activities in Malawi also only kicked-off later after 2012 following technical input and assistance from UNEP Risoe (i.e. the ACP-CD4CDM Project) hence highlighting how external assistance and expertise was crucial to develop the capacity of stakeholders and institutions in Malawi on climate finance issues.

Malawi experienced a growth in the manufacturing and sale of energy efficient cookstoves. This could be attributed to a combination of growing interest in climate finance initiatives (i.e. for PoAs and VCMs) and general business activities not related to climate finance but people’s realisation that energy efficient cookstoves reduce spending on money for firewood and charcoal. M3 considered this as a positive development but cautioned that the development of unregulated projects utilising VCMs and the increased deployment of energy efficient cookstoves for VCM projects could lead to exploitation of the carbon crediting and financing system if the activities of the project implementers were not monitored or evaluated by some public or private authority. M3 therefore suggested that Malawi needs an overseer/regulator of the voluntary carbon market/sector activities that would also organise capacity building activities to enhance

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different stakeholders and be a one stop point of contact for potential carbon buyers and/or project implementers.

On the other hand, the proliferation of the energy efficient cookstoves at the different stages in the supply chain could lead to quality control issues. With so many players in the energy efficient cookstoves sector (some attached to carbon projects and others not), there was scope for sub-standard products to enter the market and these could ruin the market and confidence of buyers should the products not achieve the anticipated savings in energy consumption and cost reductions. M26 and M25 highlighted how some of their products were imported and cost more than other products. M12 highlighted how their products were locally made but comparatively more expensive and durable than other efficient cookstoves on the market hence sometimes had sales problems as buyers tended to prioritise the cost price of acquiring the efficient cookstoves rather than durability and overall performance. Reference can also be made to Chapter 7.3.8 and M23 who highlighted that cheaper and lower quality CFLs on the market were a threat to their project and people’s perceptions of the technology/CFLs hence the inclusion of subsidised good quality CFLs in retail outlets to enable consumers not to revert back to using incandescent light bulbs.