Finance agency goes ahead with decision in spite of demand from developing nations to keep private investments out
In a move much opposed by developing countries, the Green Climate Fund (GCF) board has decided it will use market mechanisms to raise money. This has the mandate of the Conference of Parties to the UN Framework Convention on Climate Change, senior officials of body told media on Tuesday at the ongoing climate change negotiations (COP 19) in Warsaw.
Hela Cheikhrouhou, executive director of GCF secretariat, said the Copenhagen Agreement of 2009 and Cancun Accord of 2010 emphasise the use of market mechanism to capitalise this fund. “We do not want the private sector to pay into the fund. We plan to leverage private investment with public funds,” the official said.
Developing countries have demanded that GCF should only be capitalised with public money from developed countries and that private investments should be kept out of it. India along with G77 and China have argued that private investment requires creation of a uniform financial environment in each country, something which is not possible.
A senior negotiator from India said that harmonising the environment in each of the 190 countries to bring in climate-related investment is simply not possible. It is just a diversion created to avoid discussing public money, he said.
Triggers for funds
Manfred Konukiewitz, co-chair of GCF, said that the roadmap of collection of funds will be ready by the fall of next year. “We have decided in meetings in October to focus our work on to build what we call eight triggers,” Konukiewitz said. These eight triggers will help to make contributors comfortable while making these donations he said. These triggers will also decide who will have access to these funds, he said.
Konukiewitz also said that there is no truth in the fact that GCF is an “empty shell” with no money in it. “I completely disagree,” he added.
GCF is a multilateral fund that was agreed to by countries participating in the climate talks in Cancun, Mexico in 2010. It has 24 board members, with equal representation from developing and developed countries.
Enhancing direct access to the Green Climate Fund
Pro-poor climate finance: is there a role for private finance in the Green Climate Fund?
Delhi vision statement: the green climate fund
We are a voice to you; you have been a support to us. Together we build journalism that is independent, credible and fearless. You can further help us by making a donation. This will mean a lot for our ability to bring you news, perspectives and analysis from the ground so that we can make change together.
.png)
Comments are moderated and will be published only after the site moderator’s approval. Please use a genuine email ID and provide your name. Selected comments may also be used in the ‘Letters’ section of the Down To Earth print edition.