4. NEGOTIATIONS:
Diplomats begin to grapple with format for $100B fund
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Diplomats and environmental activists are drawing battle lines over the United Nations' Green Climate Fund, whose board members meet in Geneva on Thursday for the first time to work out agreements on how to deliver billions of dollars in aid to vulnerable countries.
The long-delayed board meeting will focus on procedural matters, from selecting co-chairs and a host country to devising a work plan for upcoming meetings. Looming in the background, though not up for formal discussion or decisionmaking, are meatier questions about from where an estimated $100 billion for the Green Climate Fund money will come and how it will flow.
"I don't think there will be any serious conversation about the $100 billion," Omar El-Arini, a Green Climate Fund board member from Egypt, said yesterday.
Still, diplomats and activists maintained that as rudimentary as some of current questions appear, they could have serious implications to the final plan for the distribution of dollars to developing countries.
The Green Climate Fund was created at the 2010 U.N. climate change talks in Cancun, Mexico. Leaders hope to see it up and running with pledges of at least $10 billion from wealthy countries by the time nations meet in November for the next annual U.N. climate talks in Doha, Qatar.
That goal has been complicated by a lengthy political fight among regional groups of countries clawing for seats on the 24-member board as well as the reluctance of many countries -- including the United States -- to commit funding until the architecture of the fund is settled.
This week's meeting initially was to have been held in March but was pushed back first because of a disagreement within the European Union over how to allocate board seats and later over disputes among developing countries for seats. The board is composed of 24 members and 24 alternatives, split equally between developed and developing countries.
"The first thing that we have to do is build the fund and the architecture," said Farrukh Khan, Pakistan's lead climate change negotiator and an alternate board member of the Green Climate Fund who helped steer it forward over the past two years. Khan said he will be pressing for measures like an independent secretariat and crafting a design that will ensure that the Green Climate Fund is at least three to four times bigger than any environmental fund that has existed. But, he cautioned, the process won't be short or easy, and despite being already five months behind schedule, he said, work on the fund is progressing well.
"In a process like this, I don't think we are off track. It is difficult, and it is meant to be difficult," Khan said. And while he described figuring out how to raise money for the fund as critical, saying "you can't take a bath without water," Khan argued that the fund cannot be successful without a strong institutional framework.
Concerns about private funding
The United States has a seat on the board and is represented by Gilbert Metcalf, the deputy assistant secretary over energy at the Treasury Department. Also on the board are representatives from the United Kingdom, Sweden, Russia, Spain, Poland, Norway, Japan, Germany, France, Denmark, Australia, Georgia, Barbados, Zambia, Mexico, Belize, India, Indonesia, China, South Africa, Egypt and Benin.
A Treasury Department spokeswoman yesterday said the United States' aim for the meeting is to help design a fund that will help mobilize climate aid from various sources including the private sector.
Karen Orenstein, international policy campaigner at Friends of the Earth, said civil society groups have concerns about how the fund is shaping up. Topping the list, she said, is the role of the private sector and the emphasis the United States, United Kingdom and other developed countries have placed on the Green Climate Fund being a means to attract private dollars.
Calling that trend "worrying," Orenstein said she is concerned that industry will be more interested in helping countries reduce emissions than in building much-needed resilience to climate change -- an area where conventional wisdom dictates that there is little profit to be made.
Meanwhile, a new report that Friends of the Earth put out yesterday with the Gaia Foundation and the Institute for Policy Studies warns that private companies could be used to fund a project that is not on a country's list of priorities, and calls for a "no-objection" procedure to ensure that host countries can reject or stop any project they think conflicts with their domestic development strategies.
Big 'elephant in the room'
Not all climate activists are on the same page about the role of the private sector. Richard Caperton, director of clean energy investment at the Center for American Progress, said he understands environmental groups' concerns that private dollars may not be new money -- a key demand when the fund was created.
He called for a strong accounting system, but he also said there is "zero chance" of raising the $100 billion mark without mobilizing private capital.
"I just don't see it as realistic that the U.S. government is going to give $20 billion, which I believe is our share, for this kind of fund," Caperton said.
Also primed for debate at this week's meeting is whether civil society groups will be allowed to attend. Meanwhile, Orenstein said, the still-lingering questions about where money will come from and how it will be raised remain the "elephant in the room" of the Green Climate Fund.
Meena Raman, an organizer with the Third World Network, said countries hope to have a road map by the Doha meeting of how to raise the $100 billion that nations vowed to deliver annually by 2020 and to decide how much of that will be distributed through the new fund.
Calling the empty shell of the Green Climate Fund "a problem that can't be overemphasized," Orenstein said, "Even the world's best fund is meaningless if there's no money in it."