HomeLocal NewsSetback for $100 billion climate change fund

Setback for $100 billion climate change fund

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A planned climate fund that would channel $100 billion a year to poor countries hit a brickwall yesterday when a handful of nations baulked at adopting a draft submitted at UN talks during the climate negotiations.

South African Foreign Affairs minister and COP17 president Maite Nkoana-Mashabane, who chaired the session, said a final decision would be put off, pending closed-door consultations during a three-day high-level segment with ministers next week.

In a tense session at the UN Framework Convention on Climate Change (UNFCCC) meeting, the vast majority of countries pleaded for swift adoption of the fund, which aims at helping poorer countries fight global warming and its impacts.

Forged in principle at the 2009 Copenhagen Summit, the Green Climate Fund is to be ramped up gradually to the $100 billion annual mark by 2020.

But an unlikely alliance of Saudi Arabia, leftwing states in Latin America and the United States said the proposed architecture of the fund was faulty.

“If it is designed properly, the Green Climate Fund could become a major global institution in climate finance,” said US negotiator Jonathan Pershing, a member of the committee that hammered out the draft.

“If not it would inevitably become less meaningful.”
Pershing said the current proposal was “rushed” and contained “errors and inconsistencies”.

Venezuela — representing the so-called ALBA group of Latin American countries — objected to the World Bank taking a key role in managing the fund, favouring instead a new organ under the UNFCCC.

Saudi Arabia, meanwhile, objected to the use of private finance, saying the money should come from public sources.

Most delegates, however, called for making the fund operational in Durban, and feared any attempts to improve it would end in a stalemate.

“We risk opening a Pandora’s Box,” said Burhan Gafoor, Singapore’s chief climate negotiator. “If we try to reopen it, there is no guarantee that we will have a Green Climate Fund in Durban.
The European Union, Japan and Australia all favoured pushing through the current draft to adoption, leaving modifications for later.

Also unclear is how the fund would be financed.
Many ideas have been tabled for filling its coffers, a tax on aviation and shipping fuels, a global financial transaction fee, auctioning of carbon emissions allowances — but none so far have gained much traction.

Another source of tension is where the money will go; developing nations want more money for adapting to climate change rather than keeping emissions down.

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