Global and national finance to tackle climate change

THE developed countries have pledged to provide $100 billion each year, starting from 2020, to the developing countries to help them tackle climate change. The United Nations Framework Convention on Climate Change (UNFCCC) has set up a new Green Climate Fund (GCF) to handle the money. The GCF is a separate entity with its own Board (on which Bangladesh has a member on behalf of the Least Developed Countries Group) and its secretariat is based in Korea.
These global funds are meant to support all developing countries in their mitigation (reducing emissions of greenhouse gases) as well as adaptation (managing the risks of adverse climate impacts) activities.
At the moment, the GCF is empty, but it is expected that some of the developed countries heads of state will make pledges at the Climate Summit called by the Secretary General Ban Ki Moon in New York on September 23.
In the meantime, however, most of the developed countries have been funding activities through bilateral aid agencies or multilateral agencies, including the World Bank and Asian Development Bank.
It is quite difficult to find out accurately who is giving how much to whom and for which activities. The best estimates are that around $10 billion to $20 billion are being provided through different channels for both mitigation as well as adaptation activities. However, when looked at in more detail, over 90% of the money is going to mitigation actions in larger and more developed developing countries such as China, India, Brazil, Indonesia and South Africa while less than 10 % is going towards adaptation activities in the poorer developing countries such as the LDCs.
Katmandu Declaration;
At the eighth international conference on Community Based Adaptation (CBA8) held in Katmandu, Nepal in April, over four hundred participants from around the world gathered to share best practices and concluded by adopting the "Katmandu Declaration on Financing Local Adaptation," which makes the following demands to global and national financial decision makers:
1. To global funders: that at least 50% of funding for tackling climate change be allocated for adaptation.
2. For national governments; that at least 50% of funds to tackle climate change be allocated to local level adaptation by most vulnerable communities in each country.
The reason for holding the conference in Nepal was to spotlight the policy of the government of Nepal to allocate not just 50% but 80% of climate change funds to local level where they have pioneered the development of Local Adaptation Plans of Action (LAPAs).
The Katmandu Declaration is now being taken to all the relevant global and national decision makers, including the Board of the GCF which has actually adopted a decision to allocate 50% of the funds to adaptation and also to prioritise the LDCs. The Board members from the LDC group (including Bangladesh) played a significant role in getting this decision.
Situation in Bangladesh
In Bangladesh, the government has set up two pioneering climate change funds, namely the Bangladesh Climate Change Trust Fund (BCCTF) which has received nearly half a billion Dollars so far over a number of years from Bangladesh exchequer. There is also a Bangladesh Climate Resilience Fund (BCRF) which is based on contributions from international donors and has several hundred million Dollars in it. Both funds are used to support the forty plus actions under six pillars that were identified under the Bangladesh Climate Change Strategy and Action Plan (BCCSAP) some years ago. Both Funds are currently under review to decide what their future should be.
In terms of how much each of the two funds delivers to the most vulnerable communities, both have already allocated 10% each towards community level adaptation activities through NGOs, which is delivered through the Palli Karma Shayak Foundation (PKSF) who has allocated most of the funds to a number of NGOs through a competitive bidding process.
However, when examining the rest of the 90% which is delivered through government agencies and ministries it is clear that very little of that is targeted specifically at the most vulnerable communities or to the local level. Hence, it is important that Bangladesh also think carefully about how to better target the climate change funds that it already has to the most vulnerable communities at the local level. For this it needs to focus more on the ministries of local government and rural development in future.
Conclusion
As the global funds for tackling climate change become available there will inevitably be some competition from developing countries to get a share of those funds. The most successful countries will be those that can demonstrate that they have the absorptive capacity to manage large funds well and have robust monitoring systems in place to demonstrate that the funds are being spent well. If Bangladesh wishes to capture a reasonable share of the global climate change funds in coming years then it needs to invest in management and monitoring of the climate change investments that are already being made.

The writer is Director, International Centre for Climate Change and Development, Independent University, Bangladesh and Senior Fellow, International Institute for Environment and Development.