First ever Green Climate Fund board meeting under way in Geneva

Co-chairs elected from developing and developed countries on day one

 
By Indrajit Bose
Last Updated: Saturday 04 July 2015

Developing countries in the past have been suspicious of the World Bank as a trustee of GCF, fearing a potential conflict of interest in cases where it implements GCF projects (Photo courtesy Friends of the Earth International)

The first meeting of the Green Climate Fund (GCF) board started in Geneva on August 23. The fund, established in December 2011 at the Durban meet on climate change, is meant to be the funding route for the US $100 billion that developed countries have pledged to give poor nations each year by 2020 to address climate mitigation and adaptation measures. Even though GCF has no money in its coffers to offer to developing countries, the meeting is crucial because it has fundamental organisational matters on its agenda that are likely to initiate work to develop the operational basis for the fund.  

As the first order of business in Geneva, the GCF board was to elect two co-chairs, one from a developed country and the other from a developing country. The board has elected Zaheer Fakir, who heads South Africa's international relations wing of the department of environmental affairs, and Ewwn McDonald, deputy director-general of the Australian Agency for International Development, as its co-chairs for a year. Apart from the election of co-chairs, the board will need to develop other organisation procedures such as detailed work plan with timelines.

Shortly after the Durban Conference of Parties (CoP), an interim secretariat was set up for GCF in Bonn, which comprised a small team of assigned staff from the Global Environment Facility (GEF, an international agency that funds projects to improve global environment) and UNFCCC, to convene the first board meeting in April. But the meeting was postponed three times as regional groups of countries could not agree upon nations that would represent them on the board. The idea was to have 24 members and 24 alternatives, equally from developing and developed countries.

According to a recent report by Liane Schalatek, associate director of Heinrich Boll Stiftung of North America, some issues will have to be tackled quickly before the forthcoming CoP in Doha later this year. “The board will need to address the fund’s relationship with the CoP as soon as possible and propose arrangements for decision by the CoP in Doha,” says Schalatek in her report, Regaining Momentum: Priority tasks for the Green Climate Fund at its First Board Meeting. Issues related to country programming and financial instruments, project cycle and allocation cannot be discussed comprehensively in one or two board meetings and these will have to come post-Doha in 2013, she adds.

Who will host GCF?

One of the key issues for the board this year will be selection of the host country of the GCF. Germany, Mexico, Namibia, Poland, Republic of Korea and Switzerland have submitted applications to host it. According to Schalatek’s analysis, it won’t hurt the applications of Germany, Switzerland and South Korea that all the three countries in Durban had announced a financial contribution to the start-up costs of the Fund. A choice for Mexico on the other hand would acknowledge the country’s historic proposal at CoP 13 in Bali for a Green Fund, the first blueprint and precursor to the GCF. However, situating the GCF in Namibia could stress the commitment of the board that the fund agency is to benefit developing countries, giving special consideration to the internationally unmet urgent adaptation needs of the poorer countries, says Schalatek.

Earlier this year, the GCF Interim Secretariat estimated that US $6.7 million would be needed to finance start-up operations of the GCF until July 2013. Of this, US $1.13 million was to go to the World Bank for its services—legal, financial and programme management—during the period as Interim Trustee of the Fund. Developing countries in the past have been suspicious of the World Bank as a trustee, fearing a potential conflict of interest in cases where it implements GCF projects. World Bank will be subject to review three years after the fund has been operationalised, and by 2015, the GCF board will have to select and appoint a permanent trustee. The meeting in Geneva, therefore, will also discuss and formally approve the arrangements with the World Bank as the Interim Trustee for the Green Climate Fund Trust Fund, says Schalatek.

There will be more clarity on some of these issues when the meeting in Geneva concludes later this week on August 25. It is clear though that any further delay in the board’s organisational matters would slow the process towards the fund’s launch, thereby leaving in limbo the need for urgent funding for developing countries to tackle climate change.


 

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