BlogBy Alex Lenferna
The 18th Annual Circus of Global Climate Politics, COP 18, is almost upon us, and it is set to be filled with more than its usual dose of fossil-fuelled developed countries, some more than others, trying to squirm-out-of, ignore, distort or dilute the principles which were supposed to bring them together under the UNFCCC - those of equity and common but differentiated responsibility (CBDR) among others.
As the COP clock somewhat ominously counts down the days until the usual horde of negotiators, fossil-fuel industry representatives, activists, journalists and others descend upon oil- and gas-rich Qatar, it is worth surveying the on-going battle for the "heart and soul" of climate finance, for after all, climate negotiations are unfortunately yet to refute the time old saying that money makes the world go round.
As we prepare to leave the Fast Start Finance period of $30 billion in additional climate finance from 2010-2012 behind (despite the fact that the promises behind it have arguably not been met) we are entering a new rather undefined era of climate finance. The agreed goal ahead of us is $100 billion per year by 2020 - a number which seems to have been picked because it is round, sexy-sounding and in the distant future, thus allowing for inaction in the present, rather than because it matches the needs of countries predicted to be affected by climate change.
For instance, $100-$400 billion is the estimated range of climate adaptation needs for developing countries alone, a number which does not even include mitigation considerations - adaptation and mitigation costs have been estimated to be jointly as high as $1.5 trillion per year.
The inadequacy of the 2020 goal aside, there remains a large gap between where we are now, how we get to that goal, and what we do in-between as commitments in that period are yet to be written in UNFCCC stone. In response the Climate Action Network and Christian Aid, among others, are calling for a doubling of the fast start financing levels as well as a commitment to the capitalisation of the Green Climate Fund. News from the Green Climate Fund (GCF), however, is a rather mixed bag.
On one hand, the GCF has found its home in South Korea, and will shortly be granted its own legal personality, thus ensuring its independence from the likes of the World Bank - an advancement which should put many minds at ease. On many other fronts the news is more disconcerting. Firstly, the fund has not yet pulled together the money it needs simply for administration (which weighs in at a far from negligible $7 Million until the end of 2013). This is a worrying sign, given the GCF's much more ambitious financial mobilization goals.
Secondly, far from being a model of transparency and accountability, thus far the Green Climate Fund Board has operated in a much more closed manner than other UN predecessor funds such as the Adaptation Fund. Although these might be teething issues, the proceedings of the meetings are not being readily published, and observer participation is being neglected. As some civil society observers report, in the absence of a decision on disclosure, instead of an assumption of openness the co-chairs of the GCF Board are operating on an assumption of exclusion and confidentiality.
Compounding the above worries is the battle around the privatization of the GCF and the role of the private sector. Within this space there exist two major competing visions of the GCF. The first vision favoured by most developing countries sees the GCF as housed firmly under the COP, ensuring that it draws mostly on public funds from developed countries, thus fulfilling the principles of equity and CBDR by ensuring the transfer of funds from historic emitters in the developed world to those least responsible who are set to be affected by climate change.
The competing vision is favoured, for soon to be obvious reasons, by developed countries such as the US and UK. It aims for a GCF more divorced from the UNFCCC and its principles and sees public finance as playing a limited role in order to leverage more private financing. Part of what the privatisation of the fund allows for is for developed countries to weasel their way out of responsibilities under the principles of equity and CBDR by allowing private finance to fill the void of their unfulfilled promises.
While it would be foolish to bar the private sector from involvement in climate finance, as Kathy Sierra (formerly of the World Bank) points out, this should not interfere with the responsibilities that developed countries have to developing countries under the UNFCCC, responsibilities, which are arguably why the GCF was set up to allow for the fulfilment of in the first place. Private sector financing can be leveraged through other channels, but the GCF was arguably intended for another purpose, to fulfil international climate justice. Concerns for which are seemingly being overridden by other interests, which is a far from an unusual occurrence within the COPs.
Indeed, this particular battle is reflective of a larger negotiated struggle to divorce the global climate regime from the principles of equity and CBDR that underpin the ideals of climate justice enshrined in the UNFCCC framework, as is reflected by the battle led by India for the inclusion of 'equity' in the Durban Platform, and the numerous attempts, most notably, by the US, to break down the firewall between developing and developed countries with regards to mitigation obligations, as defined by CBDR.
In response, as the Times of India reports, an unusual coalition called the 'Like Minded Developing Countries on Climate Change' is emerging, consisting of China, India, Saudi Arabia, Sudan, Egypt, Thailand, Malaysia, Argentina and about three dozen other developing countries. Their stated aim is to fight for equity and CBDR's central role in climate negotiations.
As the above indicates, the Green Climate Fund will be one of many places where their work will be cut out for them, and hopefully others will help fight to preserve a more noble and equitable development of the GCF.
The potentially worrying involvement of the private sector in the GCF does not end there, however. Many from developed countries are pushing for direct and indirect access to the GCF for private sector companies.
According to Janet Redman of the Institute for Policy Studies, if such a proposal goes ahead "Shell and Exxon could get access to [the fund to] build a massive wind farm in Mexico that powers Walmart". This is a worrying trend for developing countries who may have wanted to use the fund to bolster national attempts to respond to climate change.
Whether that problem will be acquiesced by the 'no objections' principle set to be enshrined in the GCF, which allows countries to halt projects if they are seen to be contrary to their national interests, depends on how such a principle is defined going into the future, an important point of concern. What is considerably more worrying is revealed if we consider what the struggle for the nature of the GCF could mean for adaptation funding.
In line with the privatization of the fund some are calling for the fund to be structured and operated similarly to the Climate Investment Funds (CIF) under the World Bank. This has potentially dismal results for the supposed balance of the GCF between adaptation and mitigation interests, for if we look to the CIF we can see that from 2006-2011 only 2.4% of its funds went to medium or small sized companies, only some of which operate in the adaptation sphere. The majority of the remainder went to large scale mitigation projects, which, although important, does not do much to promote climate resilient development and thus fulfil the adaptation side of the equation.
Perhaps in order to protest the GCF following in the CIF's large-scale mitigation footsteps one might appeal to the governing instrument of the GCF which states that the GCF should be balanced between needs for mitigation and adaptation. However, just what would qualify as a 'balance' is difficult to tell, as the term is ambiguous - an ambiguity which will most likely be hotly contested, as most ambiguities are within UN spaces.
If past climate finance is anything to go by the balance is certainly not an equal one, with just 15% of overall climate financing going to adaptation in the past according to ClimateFundsUpdate.org. In relation to this backdrop would balance entail continuing this ratio, or would it mean a 50-50 share, or alternatively would balance entail redressing the past unequal ratio between adaptation and mitigation funding? How do we define balance?
If the private sector is allowed to take the helm of the GCF, out from under the wing of the COP, as some are proposing, I fear that the definition of balance will not be defined through appeal to moral principles and the weighing of the interests of both future and current generations, but rather through the interests of private companies who dictate the agenda according to what serves their interests.
And adaptation, for a number of reasons, just is not sexy or very profitable for private interests. Indeed, if we look to a report by the Climate Policy Initiative we see that just 5% of private climate finance goes to adaptation. Furthermore, if the GCF becomes a mitigation-heavy fund, we are in danger of it merely becoming a vehicle through which much of the developed world farms out their responsibility to mitigate greenhouse gas emissions to the developing world, while not addressing the current and potential damages and harm caused by the emissions that they have emitted and for the large part continue to emit.
Of course it is clear, as the UNEP Emissions Gap Report illustrates, that as things stand we are failing rather dismally on the mitigation side, such that our current pledges, even if they are fulfilled, will set us on a track of 2.5 - 5 degrees warming by 2100. Thus mitigation is of course important and against this backdrop we have responsibilities to future (and current) generations to develop mitigation.
But against these obligations, we must not forget the obligations to those being affected by climate harms now and in the near future.
According to the Global Humanitarian Forum, headed up by former UN Secretary General Kofi Annan, climate change is responsible for 300,000 deaths a year and affects 300 million people annually. By 2030, the annual death toll related to climate change is expected to rise to 500,000 and the economic cost to rocket to $600 billion. For those most vulnerable to the effects of climate change (and sadly most often least responsible for causing the harms) adaptation is a priority whether our international political regime recognises it or not.
In sum, the battle for the heart and soul of the Green Climate Fund will most likely be a contested one as the competing visions outlined above play out against each other. As things stand, Omar El-Arini from Egypt has been one of the sole GCF board figures fighting for what I have outlined as the more noble vision for the future of the Green Climate Fund. Let us hope, however, that more join him on the frontlines of that battle, for we can be sure that the support for the competing arguably less noble vision is substantial.
For too long we have allowed corporate power and the interests of a global elite to dictate the direction of climate negotiations and to set the very boundaries of what is possible for us to achieve in response to the burning issues of climate change. It will be a sad day indeed if we allow them to dictate the future of climate finance and, in doing so, overlook both the responsibilities of those historically responsible for climate change, as well as the real and violent impacts that climate change is having and is set to have upon the most vulnerable people across the globe.
Let us hope that this year the air-conditioned halls of yet another COP will not allow us to forget about those for whom climate change is not a matter of mere political negotiation, financial figures and profits, but for whom the effects of climate change shape their ability to enjoy basic human rights, to survive and to lead a decent human life.
1. Many thanks to the Heinrich Boll Foundation for organizing a visiting tour to Washington DC around the players, procedures and politics around climate finance for adaptation action. Many of the insights from this article come from that tour.
2. From a meeting with Janet Redman organized by the Heinrich Boell Foundation in Washington DC.
The author is a South African Fulbright Scholar pursuing his PhD at the University of Kansas based in the Philosophy Department looking at issues of social and environmental justice. He is also a research associate at the IGERT C-CHANGE Inter-Disciplinary Climate Change Research Unit (http://web.ku.edu/~crgc/IGERT/).