From Cancun: Getting a Climate Green FundDecember 8, 2010 By Alex Stark16th Conference of the Parties of the UN Framework Convention on Climate Change (UNFCCC), known as COP-16, in Cancun, Mexico. No one expects a binding emissions reduction agreement, but a successful outcome on a set of decisions here – the so-called “balanced package” – will help build trust among countries and make progress towards a final emissions agreement next year.
One of the most important parts of the package is agreement on the creation of a green climate fund – an international fund designed to help developing countries adapt to and mitigate the effects of climate change.
If the negotiations are as successful, as expected, the fund will be part of a package that also includes the architecture for an adaptation body, technology transfer, REDD-plus, and progress towards a binding international mitigation agreement that negotiators hope to conclude at COP-17 in Durban, South Africa.
An event Monday morning co-hosted by Oxfam and the Global Campaign for Climate Action, featured a variety of developed and developing country perspectives about what a new fund for mitigation and adaptation programs should look like.
The event was galvanized by a letter, currently being circulated here at the talks, signed by 215 civil society organizations and calling for “the establishment of a fair global climate fund at COP-16 that will meet the needs and interests and protect the rights of the most vulnerable communities and people around the world.” In opening comments and a question-and-answer session, panelists articulated some of the most contentious points that negotiators are currently discussing, some of the reasons why a green fund is so important, and the implications for global equity, sustainable development, and international security.
A main point under discussion right now is how the fund will be governed. The United States and other developed countries argue that the fund should work under the supervision of the UNFCCC but international financial institutions, like the World Bank, should also assist in creating the fund.
Judith McGregor, the UK ambassador to Mexico, argued in her opening statement that for the United Kingdom, “climate finance… is a clear, clear priority” at the COP, but that the World Bank would lend the fund legitimacy and make donors more confident in the fund’s ability to deliver. Tim Gore from Oxfam expressed the opinion held by many civil society organizations and delegates from developing countries, that the fund must “act under the authority of the UNFCCC… independent from institutions such as the World Bank,” because a new climate fund should have an equitable governance structure that includes the voices of developing countries, civil society members, indigenous peoples, women, and other stakeholders – not a majority share by the developed countries like at the World Bank.
Another stumbling block is how climate finance will be divided between adaptation and mitigation programs. Gore argued that adaptation and mitigation finance must be balanced 50-50, whereas currently “there is a huge adaptation gap… less than 10 percent of current climate finance is going to adaptation.” Evans Njewa, the lead finance negotiator representing the group of Least Developed Countries (LDCs), noted in his statement that “adaptation is the priority for the LDCs [in Cancun].”
The source of these funds is also a contentious issue that divides developed and developing countries. Under the Copenhagen Accord, most of the COP country parties agreed that developed countries would mobilize $30 billion in fast start finance by 2012 and $100 billion per year by 2020 in climate finance from public, private, and other “innovative sources,” such as a carbon tax or cap-and-trade systems. Developed countries like the United States are mobilizing public funds for climate finance but argue that the majority of the $100 billion figure should be provided by private investments and that loans provided by development institutions as well as grants should also count.
Climate finance for adaptation will help make poor, rural communities in particular more resilient to the effects of climate change, including drought, floods and tropical storms, and therefore help the international community to achieve several related development milestones such as the Millennium Development Goals, according to Alzinda Abrea, finance minister of Mozambique.
Cate Owen of the Women’s Environment and Development Organization (WEDO) explained that investing in climate adaptation now “makes good sense” because “investing now in responding to climate change will lessen the long-term costs” to developed country donors.
The message that climate adaptation measures are becoming essential to sustainable development was perhaps delivered most forcefully by Florina Lopez, an indigenous person from Panama, who described the impacts that her people are already suffering as a result of climate change. Since her community survives by fishing, hunting and growing crops, severe flooding is disrupting indigenous ways of life and floods bring assaults on community health, like diarrhea, skin disease, and malnutrition. Community activities that contribute to development such as education and healthcare are also paralyzed by these impacts. Adaptation funding will be essential for her community to survive and to avoid disruptive displacement.
Still, perhaps the most compelling political reason for American taxpayers to invest in climate change adaptation in the developing world is the national security implications of the effects of climate change. A report issued this week by the Center for American Progress and the Alliance for Climate Protection explains why the United States must have a global climate investment strategy, despite adverse economic and political conditions domestically. Adaptation funding will “reduce risks of climate-related national security threats, including from severe floods or droughts in Pakistan and the Middle East” and strengthen our relationships with developing country recipients, including strategically important partners like India, Indonesia, and Brazil, write the authors. Finally, by managing displacement, migration, and violent conflict driven by the effects of climate change, such as water scarcity, climate change adaptation can help bolster international security and stability.
The establishment of a climate green fund here in Cancun is essential for an equitable and balanced international climate deal. A fund is first and foremost the moral imperative of developed countries, known as the Annex-I parties under the UNFCCC, who are historically responsible for greenhouse gas emissions. However, developed countries need not rely on the moral argument to convince policymakers and taxpayers that climate adaptation for the poorest and most vulnerable countries and people is a good investment.
Within the UN process itself, a robust, well-run, equitable green fund would help rebuild the trust lost between developed and developing countries at Copenhagen last year. In Gore’s words, Oxfam is “cautiously optimistic that we can get an agreement here in Cancun that rebuilds trust between rich and poor countries.”
Alex Stark is a program assistant at the Friends Committee on National Legislation, working on the Peaceful Prevention of Deadly Conflict Program. She is attending the Cancun negotiations as part of the Adopt a Negotiator team.
Sources: Alliance for Climate Protection, British Foreign and Commonwealth Office, Center for American Progress, Global Campaign for Climate, Mozambique Ministry of Planning and Finance, Oxfam, UN Framework Convention on Climate Change, Women’s Environment and Development Organization.
Photo Credit: “Will you back a climate fund?,” courtesy of flickr user Oxfam International.