What do we have to show after two gruelling weeks of negotiations on international climate policy in Qatar? The Conference of the Parties (COP) to the United Nations Framework Convention on Climate Change (UNFCCC) met at the end of the so-called fast start finance (FSF) period, during which developed countries agreed to provide public finance approaching US$30bn between 2010 and 2012 to help developing countries respond to climate change. The Doha Gateway reiterates long-term commitments to scale up climate finance, but practical ambition on delivering climate finance in the immediate term remains elusive.
Countries re-affirmed commitments to mobilise US$100bn per year from public and private sources by 2020.They also recognised that Fast Start Finance delivered. Developed-country parties are invited to provide information on their strategies to mobilise this scaled-up climate finance in the context of meaningful mitigation actions and transparency on implementation at COP 19 next year. A common tabular format for developed countries may prompt more consistent reporting on the scale, instruments, and objectives of the climate finance delivered. Hopefully, ensuing information on climate finance will be more complete and comparable.
Efforts to find solutions to long-term finance needs were extended.
The Qatari COP president is to select two new chairs to extend the work programme on long-term finance (LTF) that was initiated in 2012 for one more year. The report that South Africa’s Zaheer Fakir and Norway’s Georg Børsting submitted to COP 18 after a series of workshops and seminars presented honest reflections on the difficult issues that underpin any meaningful efforts to deliver climate finance at scale and use it effectively.
It will be important to sustain the frank debate that shaped the LTF work in 2012. The new phase of work will need to advance efforts to unlock potential new sources of finance from developed countries. There is also strong interest in understanding how climate finance can shape (and is shaped by) underlying policy, regulatory and governance frameworks within developing countries. These discussions have implications for domestic political processes in both developed and developing countries.
Ultimately we need political commitments and practical action to scale up support.
There are limits to what more technical work can achieve, and the 2010 High Level Advisory Group on Climate Finance, by the G20 in 2011, and last year’s LTF process, have already produced extensive technical analysis of options. The Durban Gateway agreements commit to an ‘in-session high-level ministerial dialogue under the COP’ when it meets in Warsaw in 2013, that will take stock of efforts to scale up climate finance and discuss how further concrete progress can be made. The UNFCCC secretariat and the World Economic Forum also agreed to a joint process to highlight examples of innovative finance for public-private partnerships to respond to climate change. These fora may present some opportunities to advance some of the LTF 2012 report recommendations around the need for high-level processes to engage policymakers and the private sector on climate finance.
But what happens in the near term?
Developing countries advocated for a mid-term target finance target of US$60bn per year by 2016, with the majority of this finance from public sources. Developed countries, who currently face economic difficulties and severe pressures to cut back public spending, could not accept this proposal.
The compromise agreement ‘encourages’ developed-country parties to increase public climate finance to at least the average annual level of the fast-start finance period between 2013 and 2015. Germany, the UK, France, Denmark, Sweden and the European Commission have made US$6bn in new support in 2013. These commitments are made despite fiscal austerity, and represent an important and positive signal of sustained action. But there is still a need for other countries to make commitments, and to find ways to scale up finance over the next few years.
The Green Climate Fund (GCF) is the most recent multilateral fund to be created under the UNFCCC. It is meant to become the channel through which most public finance is directed. Parties urged the newly constituted GCF board, which met twice in 2012, to advance its work in the most efficient and expedient manner possible to ‘enable an early and adequate replenishment process’. The March 2013 meeting of the board in Berlin will be a key milestone in this regard.
Countries also highlighted the particular importance of the GCF as a channel for adaptation finance (which remains underfunded). In a separate series of negotiations, they agreed to explore options to address loss and damage resulting from the impacts of climate change.
The compromises reached in Doha represent incremental progress agreed under challenging circumstances. More ambitious commitments are urgently needed, and national efforts to implement mitigation and adaptation actions, and to scale up climate finance, are vital. The Doha Gateway nevertheless creates some important potential opportunities to mobilise effective delivery of long-term climate finance.
Developing countries for their part are making some promising efforts to incorporate climate change into development. The sustainability of these efforts hinges on demonstrating the viability of investments in low-carbon and climate-resilient development. International climate finance has a crucial role to play in creating the political and economic conditions for sustained action.