COP19 has unofficially been labeled the finance COP. When I hear this statement, I immediately think- fantastic, countries will pledge money to the funds that have been created and the developing world will have the assistance they need to mitigate GHG emissions, adapt to climate change and ultimately minimize the destruction from extreme climate events. Unfortunately, this claim is a broken record. I will touch on the principles that guide climate change finance, the current state of those funds, New Zealand’s current climate finance, and finally what to look out for regarding finance at COP19.
When I talk of climate finance, I refer to the transfer of public resources from developed countries to developing countries to support action on climate change – both to reduce or avoid GHG emissions (mitigation) and to deal with the climate impacts that are already happening (adaptation). Underpinning this idea, affirmed by the United Nations Framework Convention on Climate Change (UNFCCC) is that developed countries have a responsibility to lead on climate action because it is their historical emissions that have lead to the climate we face today.
In 2007 the UNFCCC made its greatest progress on climate finance. The principles to guide climate finance were established. Climate finance must be adequate, predictable and sustainable – climate finance must also be new and additional and flow to mitigation and adaptation equally. In 2009 countries pledged to mobilize $100bn per year by 2020 and as a sign of their intent they agreed to mobilize $30bn by 2012 as a ‘fast start finance’ (FSF) program. Oxfam have labeled this fast start a ‘false start’ – research has shown only 33% of this finance has been new, only 24% is additional to existing aid promises and only 21% went to adaptation activities. A far cry from the so called founding principles of climate finance. What infuriates me the most is that this finance will not only enable the developing world to grow but grow in a way the world has never seen before. A conscious growth that is completely aware of the worlds needs, not just the needs of a few.
Now New Zealand will confidently tell you that we are doing our ‘fair share’ – we are a small economy who cannot contribute much to the world of climate finance. New Zealand’s climate change finance concentrates on helping our partners in the pacific predominantly through bi-lateral funds. The focus is on sustainable development particularly through renewable energy projects. We have committed $80m in climate finance over the next 3 years with the majority going to the Pacific. Now this may sound quite good and I agree that our money is best spent in the pacific. However, as we do not have a separate climate finance fund and have no separation between aid and climate related aid. There is no distinction between what is already pledged and what is new and additional. How can we say we are doing our fair share when we can’t even take the first step to create the structure to measure what is new and additional. The developing world needs every penny of the $100bn and in reality that figure does not even come close to what is actually required. New Zealand must pledge our fair share and be 100% transparent that it is new and additional.
As I mentioned earlier COP19 has been labeled the finance COP. In the lead up to the new climate change agreement, to be signed in 2015 - structures for action need to be put in place, and those structures need to be supported by real finance. The developing world is desperately calling out for amounts to be laid on the table. The developed world is extremely tentative to announce real figures. The long term finance pledge of $100bn and specifically finance for adaptation and loss and damage are the major agenda items this year.
Australia has already shocked the halls today by saying that “the convention is not about welfare transfer” and that “climate finance are not donations but investments”. Furthermore they “can’t agree to mandatory commitments by developed countries”. Countries literally had to laugh at the ridiculousness of the comments. What will happen next? My heart tells me humanity will prevail and we will see some concrete pledges on the table resulting in a just long term finance plan. However we have been in this position several times before and empty promises are all too familiar in the climate change world.
Stay in tune for my next update.
By Matt Gibbons