Bridges Weekly Trade News Digest • Volume 14 • Number 30 • 8th September 2010

Geneva Meeting Pushes Climate Finance to Top of Cancun Agenda

Discuss this articleShare your views with other visitors, and read what they have to say

Last week, ministers and other top officials made progress on establishing the details of how hundreds of billions of dollars in climate aid will be raised and distributed.

The informal meeting in Geneva, co-hosted by Switzerland and Mexico, aimed to clarify the status of the billions of dollars pledged by developed countries last December at the Copenhagen climate summit to support climate mitigation and adaptation in developing countries. The funding issue now appears poised to play a prominent role in the upcoming UN Framework Convention on Climate Change (UNFCCC) Conference of the Parties (COP) in Cancun, Mexico this December.

Under the Copenhagen Accord, developed countries pledged US$30 billion in so-called “fast-start” climate funding to help developing countries finance the initial moves toward greenhouse gas reduction for the period 2010-2012. A larger goal of US$100 billion in annual long-term financing was also targeted for 2020. The Copenhagen Accord, though non-binding because it was unable to gain unanimous support from all signatories of the Climate Convention, is considered an indicative pledge by the 138 countries that have subscribed to its content.

Notably, ministers from a number of key countries in the climate change discussions - including Australia, China, South Africa, and the UK - were not present at the Geneva meeting.

US says funding issue is one element of climate “package”

Climate talks in the months since Copenhagen have produced little meaningful progress, and economic issues continue to highlight the ongoing divide between developed and developing country positions. Christiana Figueres, the UN’s climate chief, said the funding issue was the “golden key” to convincing poor nations that developed countries are serious about addressing climate change.

Jairam Ramesh, India’s environment minister also underscored that funding needed to be addressed in order to allow UNFCCC talks to move forward.

“I doubt whether the Copenhagen logjam is broken,” he said after the Geneva meeting, referring to the final hours of last year’s climate conference when parties were unable to reach consensus. “The single most important trigger for success at Cancun is the funding.”

Patricia Espinosa, Mexico’s foreign minister, assured those attending the meeting that there was still time to agree on the details of a new climate fund - sometimes referred to as the Green Fund proposal - before the December COP. However, Espinosa’s optimism was tempered by the insistence of the United States that related issues - including curbs on greenhouse gasses and monitoring of national pledges - be agreed upon before any fast-start funding flows.

“It has to be part of a package,” US climate envoy Todd Stern told reporters Friday.

Details of the fund

The possible details of the fund were discussed by breakout groups over the 2-3 September gathering. Considerable discussion was given to the role of the private sector in the fund. Countries generally agreed that private sector funding should complement public commitments to the fund. But while some developed countries stressed the potential of the private sector for generating new funds, developing countries continued to emphasise, as they have throughout the negotiations, that public financing be the main source.

Regarding management of the fund, the World Bank continues to be the developed countries’ institutions of choice, as they consider it one of the few institutions with the requisite fiduciary standards, safeguards and experience. However, developing countries do not favour the Bank, where they say decision-making is not equitably distributed and a significant percentage of pledged financing would remain with developed country consultants and bidders. Instead, they say they would prefer to see the fund managed by the UNFCCC itself or though some other independent body, a model successfully tested by the Montreal Protocol, an twenty-year old environmental agreement established to address depletion of the ozone layer.

Discussion also delved into the source of public funding with a call from developing countries for greater transparency to ensure cash for the fund is not composed of “recycled” funds transferred from existing development projects. The Copenhagen Accord calls on developed countries to provide “new and additional resources” for the fund, but some countries - notably the UK - have said that fast-start funding would not be additional to official development assistance (see Bridges Trade BioRes, 30 April 2010).

The Netherlands has launched a website - backed by the UN - that aims to track whether developed countries are honouring their fast-start funding pledges. The site currently lists only six “Contributing Countries:” Denmark, France, Germany, the Netherlands, Norway, and the UK.

The next round of UNFCCC talks will take place in Tianjin China from 4-9 October, and the Cancun COP will kick off on 28 November. Earlier expectations that parties could reach a comprehensive deal by Mexico are increasingly dubious as many issues are still unripe for agreement.

Additional information

The Dutch government’s website for tracking fast-start financing can be accessed here.

ICTSD Reporting, “Nations rethink Copenhagen commitment on climate funding,” THE FINANCIAL EXPRESS, 7 September 2010; “Summary of the Geneva Dialogue on Climate Finance: 2-3 September 2010,” GENEVA DIALOGUE ON CLIMATE FINANCE BULLETIN, 5 September 2010; “Greater clarity on climate finance at 46-nation forum,” AFP, 5 September 2010; “Progress seen on ‘Green Fund’ for climate deal,” EURACTIV, 6 September 2010.

One response to “Geneva Meeting Pushes Climate Finance to Top of Cancun Agenda”

peter leach 9th September 2010 at 14:38
Paradoxically the more money you spend on climate control, the more energy you will burn! Straight line will cut the circle of a downward spiral!

Rgds
Anonymous at