Pledges Made to Green Climate Fund Grow Ahead of Lima Talks
A multilateral fund geared towards helping developing countries tackle the negative impacts of climate change and transition to low-carbon growth models has received a flurry of financial pledges in the final weeks ahead of the annual UN climate talks.
A total of US$9.3 billion was put forward last Thursday by 21 countries at a special funding conference convened in Berlin, Germany. The occasion unveiled US$1.8 billion in additional contributions following earlier major funding announcements from the US and Japan. (See Bridges Weekly, 20 November 2014)
A further US$265m was pledged late on Thursday after the conference by Canada, bringing the fund closer to the targeted US$10 billion some climate officials have said will be critical to helping ensure success in talks on a global climate deal.
Resources pledged to the fund will be also be used to unlock finance from the private sector geared towards climate action.
“The Green Climate Fund is the epicentre that determines the direction of both public and private investment over the next decades,” said Christiana Figueres, Executive Secretary of the UN Framework Convention on Climate Change (UNFCCC).
The fund’s board will start reviewing funding proposals put forward by countries in the second half of 2015, according to officials familiar with the process.
Meanwhile, donor countries will have to come through on their pledges, which could be tricky for countries such as the US that need to get the climate aid passed through domestic legislatures. The fund currently has around US$13 million in its coffers.
The next UNFCCC Conference of the Parties will kick off next week in Lima, Peru, where delegates are hoping to pin down some key draft decisions around the new climate deal. Parties have given themselves until next year’s meet in Paris, France to secure a post-2020 climate regime capable of slashing global emissions.
Questions of climate financing have in the past proved a tricky issue to navigate in UNFCCC talks and have at times even threatened to derail them altogether.
A number of poor countries have warned that they will not be able to cope with the expected costs of mitigating and adapting to climate change. UN climate reports over the last year have also highlighted that those most affected by far-ranging climate consequences will be the world’s most vulnerable populations. (See BioRes, 4 November 2014)
“The result of today’s capitalisation of the Green Climate Fund is foremost an unmistaken sign of trust building,” said Hela Cheikhrouhou, Executive Director of the newly capitalised fund.
A number of environmental groups welcomed Thursday’s pledges although some cautioned that more ambition might be needed moving forward.
Set up at the 2010 climate talks in Cancún, Mexico the Green Climate Fund was partly designed to help developed countries fulfil a pledge to raise US$100 billion a year by 2020.
Following decisions on its institutional structure, the fund is notable for the balanced representation on its board and that pledges have also been made by some so-called developing nations. This includes a US$100 million pledge from South Korea, where the fund is based.
Adaptation, 2015 finance?
Thursday’s pledges represented the largest single resource mobilisation for climate adaptation. In a notable shift from past norms, countries have decided that 50 percent of the fund’s cash will be dedicated to adaptation.
Adaptation finance is set to be on the agenda in Lima, with some allegedly hoping for deliverables related to loss and damage compensation, as well as precision on how to finance countries’ national adaptation programme of action (NAPAs).
Some UN officials have said that adaptation more generally has now gained political parity with mitigation and this will feed into negotiations around the draft 2015 text.
“This could be a signature outcome from the Lima conference,” according to a source familiar with the process.
Delegates in Lima will consider a non-paper of parties’ views on elements of the 2015 deal. However, while finance and adaptation both feature in the document, it is far from settled how these issues will be treated.
Decisions will need to be hammered out in the next year around the shape of existing UNFCCC mechanisms in the new climate agreement including, for example, whether the Green Climate Fund would be the main finance track or not.
A high-level ministerial dialogue on climate finance will take place on 9 December in Lima that could see further discussion around these issues.
ICTSD reporting; “Canada pledges $265m to Green Climate Fund,” RTCC, 21 November 2014; “Why is the Green Climate Fund’s pledging meeting important?” RTCC, 18 November 2014.