HONG KONG, Mike Ives, New York Times, 13 September 2018— When industrialized nations pledged in 2009 to mobilize $100 billion a year by 2020 to help the poorest countries deal with climate change, it won over some sceptics in the developing world who had argued that rich nations should pay up for contributing so much to the problem. But so far only $3.5 billion is committed out of $10.3 billion pledged to the UN Green Climate Fund (GCF).
At the Bangkok meeting of the United Nations Framework Convention on Climate Change last week, the prelude to December’s meeting in Poland, where countries will try to set rules for carrying out the 2015 Paris climate accord, the some delegates described the GCF as a symbol of a broken promise. “The fund of hope is becoming a fund of hopelessness,” said Meena Raman, of the Third World Network.
Green Climate Fund runs into difficulties
The Bangkok meeting did not specifically address financing to mitigate climate change, but came two months after disagreements among the GCF’s board members prevented the fund from approving new projects.
Some observers say the fund’s funding shortfall and bureaucratic malaise have dimmed expectations for the talks in Poland, which were already bound to be difficult. “The lack of real money coming through is really undermining trust in the negotiations” around how to put the Paris accord in place, said Brandon Wu, the director of policy and campaigns at ActionAid USA. “That’s a big part of the logjam.”
The GCF was designed to help developing countries prepare for climate disasters and develop low-fossil-fuel economies. It was part of a larger plan, designed in 2009, to put together $100 billion a year for poor economies through a combination of government contributions and private investments.
Many academics see contributions to the fund by wealthy countries as a moral imperative, arguing that the developing world is most vulnerable to the effects of climate change but least responsible for causing them.
“Certainly, the richer countries should bear more of the burden in the G.C.F. because they have more means and more at stake,” said Thitinan Pongsudhirak, a political scientist at Chulalongkorn University in Bangkok. “Richer countries also have benefited from wealth accumulated over decades when climate issues were not at the forefront.”
The Obama administration delivered $1 billion of a $3 billion pledge to the program. But last year, Mr. Trump, while announcing plans to exit the Paris accord, said the United States would no longer pay into the Green Climate Fund as it could eventually cost the United States “billions and billions and billions” of dollars.
Ms. Raman said that while she still hoped to see other developed nations “step up” by contributing more to the fund, they had not yet made their exact commitments clear. “While we’re very horrified by the stance taken by the United States, all the developed countries are united around the US in not making any progress on finance.”
World leaders vowed in Paris to avoid a warming of 2 degrees Celsius over preindustrial levels (3.6 degrees Fahrenheit), a threshold that they deemed unacceptably risky. Yet there are widely varying estimates of how much money is being spent on fighting climate change in poor economies. One reason for the discrepancy is that there is no consensus over which contributions should be counted in the tally.
And critics of the Green Climate Fund have questioned why much of the money it is distributing has been channelled through large development banks, or private-sector enterprises led by global investment firms. They argue that more climate aid should go directly to governments in the developing world, or the communities at risk.
“We want money, but we’re hard-pressed to give our full blessing to the projects coming on board,” said Lidy Nacpil, the coordinator of the Asian Peoples’ Movement on Debt and Development, a regional alliance of non-profits and community groups.
But even critics of the fund worry about the shortfall, saying it poses risks for people in poor regions where governments are either unable or unwilling to spend more on climate mitigation and adaptation.
The initial, Obama-era goal of securing $100 billion in climate finance and investment per year by 2020 “was the amount needed by the countries to implement their ambitions,” said Neha Rai, an expert on climate finance at the International Institute for Environment and Development, a think tank in Britain. “But at the same time, irrespective of the amount, it gives a policy signal that climate-relevant investments are important.”
Southeast Asia is a case in point.
People who live in the Asia-Pacific region are “particularly vulnerable” to the effects of a changing climate, the Asian Development Bank said last year in a report, which projected Southeast Asia to be “most affected by heat extremes” in the wider area by the end of the century.
Of 74 approved Green Climate Fund projects worth $3.5 billion, three are in Southeast Asia and they have a combined value of nearly $156 million, according to data provided by the program. Nineteen others in the program’s pipeline directly target the region and are worth $904 million.
Ms. Nacpil said climate finance was important in South east Asia partly because so many cities are in coastal areas that are vulnerable to sea-level rise and must adapt. And because the number of coal-fired power plants in the region is expected to increase, she added, governments should be encouraged to bend national policies toward investments in renewable energy.
“The Green Climate Fund has revitalized hope for countries like Vietnam that they can meet their Paris agreement targets — embracing the green energy revolution, but also helping their citizens to adapt to climate change,” Ms. Kirsch-Wood, a climate specialist with the United Nations Development Programme, said.
But $30 million goes only so far in a country of 93 million people with an economy worth more than $200 billion and a long, exposed coastline. And in a 2015 climate plan submitted to the United Nations Framework Convention, Vietnam said that state investments could provide only 30 percent of what it needs to adapt.
“Many developing countries have made clear that they will not be able to reach their Paris agreement targets without international climate finance,” said Oyun Sanjaasuren, the Green Climate Fund’s director of external affairs.
“For its part, G.C.F.’s pipeline of climate projects in developing countries shows that demand for climate finance already exceeds supply,” she said.