“Not just a fund-a JUST climate fund”

by Nathan Thanki

Before we get the official say on what the green climate fund should look like, let’s just remind ourselves what a really just GCF would look like. As one member of the YOUNGO finance working group said today “we don’t want just another climate fund, we want a just climate fund.” So what is a just climate fund?

First and foremost, a just fund must be a transparent fund that caters to the needs of the beneficiaries–developing countries. To this end, the GCF must be accountable to the COP and not the GCF Board, or the SBI. The Board will have a 50-50 split between developing and developed countries, which does not reflect the numbers within the UNFCCC and indeed the world. Basically, the developing countries should be able to decide how they spend the climate finance, rather than have those decisions dictated by the developed countries.

The GCF has to have a distinct legal personality so that it may enter into contracts and not rely on the personality of it’s trustee, at the moment the World Bank. The role of trustee must be clearly limited to simply holding funds for donors and giving it out as instructed by the board. At no time should the Trustee apply its own policies when disbursing funds. Developing countries rightly have a problem with the World Bank acting as Trustee given their previous experiences of structural readjustments resulting from debt on development aid and loans. They are worried that the same thing could happen with climate aid.

The Fund should be filled, as an empty piggy bank is still an empty piggy bank, no matter how well designed it is. The developed countries have to make sure the GCF can be up and running quickly – and this means paying for the set up to make sure the fund is ‘operational’ ASAP. Public funds (government money) should be used, not private investment. The private sector has no obligations under the Convention. There is no guarantee that the private sector investment won’t dry up. If we look at he Adaptation Fund we can see the danger of market based approaches. When the price of carbon went down, the Fund ran dry. Saying that, it is a recession after all, so perhaps we need innovation in funding? A financial transaction tax could generate enough money to fill the fund. These possibilities need to be explored and then specified in governments pledges and deliveries of finance.

Once the fund has been filled we can get to the business of spending. A just GCF would specify that at least 50% of funds go to adaptation projects. Adaptation is not a profitable business, it is a life saving business. It will not generate profits, and therefore the money given to these projects must be in the form of grants. Loans for adaptation are going to lead to unsustainable debt for developing countries. The problem is that if loans are offered, they will take them, because the need for adaptation is so great. There should be transparency in the spending process, definitely. The money needs to go to the most vulnerable, not the pockets of some corrupt manager or politician. But transparency does not equal donor countries being able to dictate to the recipient country on how they should spend the money. That is their decision: and who knows the needs of the poor more than the poor? Designated national agencies should be chosen by the recipient country, not the donor. Such restrictions are not just. Similarly, a results based approach is unfair. Adaptation projects do not yield very tangible, measurable results. Besides, money must come first, and then results. A lack of ‘results’ should not be used to block funding for adaptation projects.

And finally, what is a just fund if not a fund that is open to people? Civil society needs to be able to apply directly to the fund: we need a dedicated civil society window. The GCF Board has 2 civil society seats: we need more. It’s our money, after all. The TC report has made note of several constituencies; such as indigenous people. This is a step toward a just fund, but a truly just fund cannot ignore the youth constituency. We are more than half of the world, and it is us who will bear the full brunt of climate change. Some of us will pay with our homes and with our lives, it is totally unjust to not even recognise us as a stakeholder. It is our future that (isn’t) being funded.

Justice is not particularly forthcoming within the UNFCCC, we know this from bitter experience. And a just climate fund is 20 years overdue, so the likelihood of Durban delivering on that front is slim. That is not to say we won’t be told there is a great, shiny, new Fund; just like we’ll be told there is a wonderful new regime to save the planet. It is important to recognise progress when it has been made, but it is more important to be sure that it is for the right thing. An empty GCF in exchange for a Durban Mandate is not just stupid, it is suicidal. A just climate fund and a just climate regime based on principles of equity, common but differentiated responsibilities and historical responsibility are demands that we must keep reiterating, till our voices are hoarse and the sun has set on Durban.


Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.