Almost Two-Thirds of Climate Fund for Developing Nations Already Pledged
Rich countries and businesses have provided close to two-thirds of the financial assistance pledged to poorer nations as part of the global climate change negotiations, ahead of the Paris conference this December.
The finding by the Organisation for Economic Co-operation and Development (OECD) is a further clearing of the path to an agreement in Paris, as it helps countries to judge whether pledges made at previous meetings can be trusted.
Developing countries were told six years ago, at the last landmark climate conference in Copenhagen, that at least $100bn-a-year would be provided as “climate finance” by 2020 - to help them cut greenhouse gas emissions and cope with the effects of global warming. But to date, there has been dispute over how much money has flowed from rich to poor.
On Wednesday, the OECD published a new report setting out in detail for the first time how much climate finance has been provided to the poor. It found $62bn had been provided from developed country governments, development banks such as the World Bank, and private sector institutions.
This still leaves a substantial gap from the target of $100bn year, but one that could be bridged by 2020 given recent increased pledges from developed country governments, and if interest from private sector institutions is encouraged.
Angel Gurria, secretary-general of the OECD, said: “Our estimates paint an encouraging picture of progress. We are about halfway in terms of time [between the pledges made in 2009 and the deadline of 2020] and more than halfway there in terms of finance, but clearly there is still some way to go.”
However, the OECD said it “had no remit to make projections” on whether the target would be hit by 2020. It is now up to developing countries to decide whether the evidence the OECD has found is sufficient to assure them of the pledge being fulfilled on deadline.
The issue is a key sticking point at the talks, because poor nations will not sign up to a deal in Paris unless there is clear evidence that the previous pledge is being met.
Developing countries will be asked, in effect, to take it on trust at Paris that the gap between current finance and the target will be filled. A report earlier this year from the World Resources Institute suggested that on these levels, the target could be reached, though only if developed countries and public and private institutions stepped up their efforts.
The OECD said climate finance from rich to poor countries stood at $62bn in 2014, up from $52bn in 2013 and making an average of $57bn annually over the 2013-14 period, in its report Climate Finance in 2013-14 and the USD 100 billion goal.
Finance from public sources - usually the taxpayer in developed countries - made up more than 70% of the flows in 2013-14, and most of the remainder came from private sector sources which were “mobilised” by the public sector, for instance in the form of loans or joint funding for projects.
More than three-quarters of the money was used for activities to cut greenhouse gas emissions, with about a sixth going to projects to help countries adapt to the effects of climate change. Such adaptation has been seen as a less important issue in the past, but is expected to receive much more emphasis at the Paris conference.
The OECD’s findings represent a marked increase on previous estimates of climate finance flows. Estimates by the Climate Policy Initiative, endorsed by the World Bank earlier this year put the flows at just $34bn a year in 2013. Today’s OECD report was compiled in collaboration with the Climate Policy Initiative.
Putting a definition on what constitutes climate finance is still a work in progress.
The amounts derived from governments and development banks, such as the World Bank and the African Development Bank, should be relatively easy to amass as they are declared and documented, but there are still disagreements. For instance, the OECD said it had stripped out from its assessments money going to coal-fired power stations.
Japan has argued strongly for money going to high-efficiency coal-fired power plants to be counted, as they represent a marked improvement on older versions, and as many developing countries are likely to continue to be reliant on indigenous coal supplies for years to come.
When it comes to private sector contributions, the picture is even less clear. Many private sector projects involve financing from a range of sources, and the projects may be complex, for instance encompassing the redevelopment of existing infrastructure, such as transport or power grids.
SOURCE: www.theguardian.com - http://www.theguardian.com/environment/2015/oct/07/almost-two-thirds-of-climate-fund-for-developing-nations-already-pledged
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