By John Parnell
A meeting of climate finance donors in Washington DC last week has been written off as a “technical dog and pony” show by observers.
RTCC understands the State Department hosted event provided few answers on how rich nations will meet their climate finance obligations, a critical issue that will dominate the UN climate negotiations that open in Bonn on April 29.
An official summary instead focused heavily on discussions on leveraging private finance, and confirmed that talks between major donor countries would continue later in the year.
“From what we’ve heard from those inside the room, the climate finance mobilizer’s meeting convened by the US State department appeared to be more of a technical dog and pony show about how US agencies and organizations are engaging the private sector,” Janet Redman, from the DC based think tank the Institute for Policy Studies told RTCC.
“Any discussion of innovative sources of new public finance, like a financial transaction tax, was sidelined – in spite of demonstrators outside calling for a Financial Transaction Tax and the Norwegian Minister of International Development, Heikki Holmås, joining the rally calling for new public money.”
Protests outside the US meeting called for a ‘Robin Hood Tax’ on financial transactions (Source: Flickr/Friends of the Earth US)
There are concerns that focusing heavily on private money for climate finance will mean less profitable projects such as climate adaptation are sidelined.
Ministers and senior officials from Japan, the EU, Canada and France took part in the discussions – RTCC understands some European delegates felt they were being ‘lectured’ by the hosts.
“Participants agreed to take stock of these and other coordinated efforts and private sector efforts at a ministerial meeting in the fall prior to COP-19 [UN climate talks],” reads the Chair’s summary of the event.
“Participants also agreed on the importance of engaging with developing countries as broader strategies and approaches for mobilizing climate finance are considered.”
RTCC asked the State Department for clarification of what exactly was agreed or achieved, but were referred back to the statement.
Trust
Climate negotiation insiders have been quick to claim the concept of a finance summit which did not involve developing nations was flawed from the start.
“They should now follow up with another meeting where they invite NGOs, and where the challenges with private finance are addressed.
Private finance is no silver bullet. It will only deliver if there also are robust frames for how to mobilise and manage the initiatives,” said Mattias Söderberg, chairman of the climate change advisory group at the ACT Alliance.
“Why were developing countries not invited from the start? A common understanding among donor countries will be of no use unless developing countries also agree.”
The chair of the Least Developed Countries (LDCs) negotiating bloc at the UN climate talks issued a guarded response to the summit.
“Copenhagen has proven that inclusiveness is essential in the climate change negotiations process,” he said.
“Representation of 12% of the world’s most vulnerable and poor population would certainly be necessary for exchanging and exploring ideas, and taking decisions related to global issues.”
While the statement released by the event’s Chair confirmed a consultation process with developing countries, it is unclear how extensive this will be and whether they will be present at the next high level meeting in the Autumn.
Short term goals
Concerns over the inadequate provision of short term climate finance have been festering since the last round of UN climate negotiations in Doha concluded.
The Fast Start Finance (FSF) period finished at the end of 2012, and poorer nations are waiting to see if there is a new plan to deliver more funding for clean energy and adaptation projects.
“What outcomes will result from this process remains unclear. Further, there is much work to do to reach the $5.7 trillion investment challenge by 2020. Another outstanding issue is how to achieve a political commitment of $100 billion by 2020,” said Clifford Polycarp, senior associate at the World Resources Institute (WRI).
“Progress will depend on how the other pieces of an international agreement, particularly on mitigation, progresses,” added Polycarp.
“They agreed to develop working groups to understand how various institutions – multilateral development banks, development financing institutions, and export credit agencies – could do better.”
RTCC BRIEFING – Climate Finance Basics
The Green Climate Fund (GCF) was established via the UN climate talks to act as the main funding vehicle for climate finance but was not mentioned in the Chair’s summary of events. The GCF has a goal to raise $100bn annually by 2020.
This year’s World Economic Forum meeting estimated that $700bn of investment would be required annually on forestry, clean energy, sustainable transport and energy efficiency to reduce emissions with another $5trn needed to “green infrastructure”.
Developing nations at the UN climate change talks were insisting on a “roadmap” to show how the current level of climate finance of around $10bn a year would be scaled up in the run to 2020.
The WRI has suggested that governments should be focusing on the €5.7trn figure rather than the self-assigned target of $100bn.