Micro-business participation in collective flood adaptation: lessons from scenario-based analysis in Ho Chi Minh City, Vietnam

Abstract

Although research on the impacts of climate change on small- and medium-sized enterprises (SMEs) and their adaptation to climate change risks has recently received more attention, the focus on micro-businesses and household businesses is still very limited. Micro-businesses and household businesses are adversely affected by compound flooding events – a situation that will become more acute in the future – but there is little attention in the scientific literature to their adaptation options and actual implementation. Against this background, the paper analyzes the following research questions. How are micro-businesses already responding to flooding? Are micro-businesses willing to collectively invest in future proactive adaptation efforts in their neighborhoods? What are the key drivers of and barriers to adaptation? Based on scenario-based field experiments in Ho Chi Minh City, our results show that micro-businesses could play a much larger role in collective adaptation. Often overlooked in adaptation research, their willingness to engage in collective action under severe constraints is surprising. The conceptual framework presented in this paper helps us to understand the key drivers of and barriers to micro-business willingness to participate in collective adaptation activities. The most important key barriers for micro-businesses are limited financial capacity and lack of support from local authorities. However, micro-businesses are willing to contribute depending on the concrete adaptation measure and financing options. If no financial contribution is expected, almost 70 % are willing to participate in awareness-raising campaigns. And although their financial capacity is very limited, 39 % of micro-businesses would contribute financially if the costs were shared with other businesses in their neighborhood and with local authorities. In this context, micro-businesses should be much more involved in adaptation plans and measures. Through their local embeddedness, they can be important multipliers in strengthening adaptive capacity at the local level.