Financing for poor countries seen as key to agreement in Warsaw

WARSAW, Poland -- U.N. climate change talks here will fail if developed countries don't take seriously developing countries' calls for progress on finance, according to environmentalists, some of whom staged a walkout today to call attention to the issue.

The talks are due to end tomorrow, but parties are still at odds on how and when developed countries will ramp up financing to help poor countries cope with the effects of climate change and limit their own emissions.

If delegates can't hammer out a deal, advocates say, finance could undermine hopes of the summit producing a more definite timeline for when countries offer their emission-reduction targets for an agreement to be finalized two years from now in Paris.

"It's linked," said Alden Meyer of the Union of Concerned Scientists. Poor countries won't allow a deal on emissions reduction to proceed if their own needs are not met, including certainty on finance and a mechanism to address loss and damage related to changing weather patterns, he said.

"Their leverage is they know the United States and other developed countries want to see the [climate mitigation] process go forward, and that's the bargaining chip they have," Meyer said.

For their part, negotiators for the United States and the European Union say they appreciate poor countries' need for certainty around climate finance. Former Secretary of State Hillary Clinton brokered the deal at the 2009 Copenhagen, Denmark, talks in which wealthy countries pledged to mobilize $100 billion annually by 2020. Some portion of that will flow through the Green Climate Fund, which will help wean developing economies from carbon.

And developed nations say they have met their short-term finance commitment for delivering $30 billion between 2010 and 2012. They have pledged to maintain or improve those funding levels going forward, and U.S. Special Envoy for Climate Change Todd Stern says the United States has provided $2.7 billion this year.

It was a point he reiterated at the summit's high-level discussion on climate finance, a first-of-its-kind event that was sought by developing nations at last year's gathering in Doha, Qatar.

"Contrary to fears that climate finance would 'fall off a cliff' in 2013, our 2013 level is actually higher than the average of U.S. contributions during fast start," Stern said, adding that the figure included only America's public contribution, not private funding the government funding helped to leverage.


But while Stern said there is more to come, he has also said the American delegation did not come to Warsaw armed with new numbers (Greenwire, Nov. 19).

A U.S. official said the $100 billion commitment by developed nations at the climate talks in Copenhagen was made in the context of developing countries taking action to rein in their own emissions.

"The parallelism between mitigation and finance was clear and deliberate," the official said. "Countries did not sign up to a series of constant financial commitments for the intermediate years."

Some E.U. countries, by contrast, did bring their wallets to the talks.

Germany has become the E.U. leader on climate finance, announcing this week that it will pony up $30 million for an adaptation fund under the Kyoto Protocol and an additional $120 million in funding to combat deforestation in developing countries. It has committed to provide a total of $1.8 billion in 2014.

The United Kingdom has pledged $1 billion for 2015-2016 with Sweden offering a new $33.5 million for adaptation and the Netherlands planning $340 million for 2014. And Finland has pledged a fresh $5 million, which observers say is significant given its size.

But the European Union's combined $7 billion in new pledges will not be enough for developing countries, according to environmentalists and others who track the issue. Developing nations need certainty on midterm financing -- money that will flow to them between the fast-start period, which ended last year, and 2020 when the $100 billion fund is supposed to be up and running.

They also want to know when the Green Climate Fund will get bankrolled. So far, only Sweden has contributed more than a pittance for its administration. And the poor nations want the money to help adaptation efforts and not wind farms and solar projects that rich nations say have been funded by private companies as a result of their public contributions.

Even large developing countries that would be unlikely to share much in the adaption largesse have said that something new and substantial on climate finance is needed in order for there to be any agreement at Warsaw.

"They need to fulfill these commitments," said Xie Zhenhua, the head of China's delegation, during a briefing with reporters yesterday. "They have to provide a timetable and also the size of their contribution. They should have a very clear signal to society."

'Some flexibility'?

The European Union and United States say they want clarity on when countries like China will lay out their targets for reducing emissions after 2020. The European Union and United States differ slightly on when these targets should be released. The European Union has called for release next fall, while Stern says the Obama administration is already working on its next set of commitments but they won't be ready until early 2015.

But large developing nations like China, India and Brazil say they want to put forward pledges much later, if at all. They say last year's agreement in Doha does not erase the basic principles of the U.N. Framework Convention on Climate Change, which assigns different emissions-reduction responsibilities to developed and developing nations.

Some observers say large developing nations appear to be seizing on the conflict over climate finance to delay action on mitigation.

But Liz Gallagher, a senior policy adviser for the Britain-based E3G, said they genuinely care about developing countries' priorities in this process.

"Just the fact that we're four years on from Copenhagen and there's still no way of seeing how this money is going to be delivered -- there's just a sense of frustration," she said.

Gallagher said developing countries are not asking for a radically higher commitment from the developed world, they're asking for certainty about when they will have funding to climate-proof their roads and bridges, fortify their communities against floods and take other steps that will ultimately yield dividends for the West by avoiding the need for extensive disaster relief funding in the future.

There is also a concern, she said, that the European Union and United States may be withholding commitments on funding in order to wring concessions from other countries on mitigation.

Ruth Davis, a policy adviser for Greenpeace in the United Kingdom, said there is still hope that the talks will yield a meaningful outcome on finance.

E.U. negotiators, she said, maintain there might be a way to write language into the text to be adopted at the end of the conference that would give more certainty about when commitments will be made and what that money will go toward -- namely adaptation projects and aid for vulnerable communities.

"There is some flexibility there, and there has to be because otherwise there won't be progress," she said.

'A lot to be angry about'

Greenpeace is one of many advocacy groups that staged a walkout today over the finance and loss and damage issues.

Participants said the stunt was aimed at drawing attention to what they called a disintegration of ambition to fight climate change in Warsaw.

"The Polish government has done its best to turn these talks into a showcase for the coal industry. Along with backsliding by Japan, Australia and Canada, and the lack of meaningful leadership from other countries, governments here have delivered a slap in the face to those suffering as a result of dangerous climate change," said Kumi Naidoo, executive director of Greenpeace International, in a statement.

Behind the scenes, though, groups were sharply divided over whether walking out of Warsaw talks would be the best way to influence the negotiations.

Asked whether he thought the walkout would be effective, Meyer of the Union of Concerned Scientists shrugged.

"I understand the frustration and the anger about the lack of progress. There's a lot to be angry about," he said. "I have a different strategy and a different tactic, because I think it's possible to make progress here in the next two days."

Reporter Lisa Friedman contributed.