Saturday, 5 December 2015

Are rich countries selling the developing world short on climate change?

Extract from The Guardian

Rich countries say they are on track to beating the $100bn climate fund target, but poorer countries criticise the unfair burden of loans and a stark lack of money for adaptation
The problem of the $100bn is not whether it will be reached – it almost certainly will – but how. Photograph: Patrick Aventurier/Getty Images


Friday 4 December 2015 23.55 AEDT


Poor countries at climate talks in Paris have railed against an attempt to water down assistance promised to help them overcome the climate crisis they did not cause.
Rich countries are committed to provide $100bn (£66bn) to developing countries by 2020. More than any other, this figure will decide the fate of the talks billed to stop climate change.
On Wednesday, US special envoy for climate change Todd Stern had told a press conference that donor countries were “well on the way to beating that pledge”.
Stern said a “conservative” report compiled by the Organisation for Economic Co-operation and Development (OECD), a thinktank sponsored by the richest countries on Earth, in October “showed on the basis of 2014 numbers we are around $62bn, probably a little bit more than that”.
For the period between now and 2020, he said: “There have since that time been a number of pledges made both by individual countries... I think if you look at all of those pledges, plus what the OECD have already totalled up... we are at a pretty high number, both where we are now and where we’ll be over the next few years.”
And yet the problem of the $100bn is not whether it will be reached – it almost certainly will – but how. There is an almighty gap between how the developing and developed worlds define what counts as adequate climate assistance.
Within the monies the OECD counted as climate finance was a vast range of loans, grants and aid relabelled as climate-related, much of which developing countries do not see as assistance but investment. On top of this, the OECD model adds in the private capital “mobilised” by the trickle of public cash.
For example, Germany and France have promised to increase their 2020 finance to $4.47bn and $4bn respectively. Yet despite the similar numbers, grant-making Germany is seen as a leader and money-lending France a villain.
For developing countries, loans are a particularly problematic aspect of this methodology. Gambia’s environment minister, and representative of the least developed countries group, Pa Ousman Jarju said: “We cannot take loans to pay for climate change and take that as climate finance. For us it needs to be grant-based finance because we are not responsible for what is happening.”
Stern’s upbeat analysis was scorned by Nozipho Mxakato-Diseko, the South African chair of the Group of 77 and China, who speaks for the poorest 134 countries in the negotiations. She called the OECD report a “mirage” that was being used to create the illusion of a finance process on the right track.
“We had been asking for work to be done by the [UN] standing committee on finance. An institution of the convention. And every time we asked, those requests were refused,” said Mxakato-Diseko.
Instead, she said, wealthy countries had elevated the methodology of a thinktank to de facto UN climate policy, without consultation.
“We woke up to find that we had a report that was telling us that we were accomplishing [$100bn]. We were not aware of that report. We were not aware that countries had mandated that report,” she said.
Oxfam’s climate policy adviser Jan Kowalzig said: “It’s deeply concerning that a donor-driven methodology like that of the OECD is being used to champion rich country climate funding [as being] at a pivotal stage in sealing a climate deal. The system is far from perfect and, critically, is based on donor countries’ choices on what and how to count, allowing funding levels to look higher than they actually are.”
There is just one day of talks left before negotiators must hand over a workable draft to their various ministers for the second phase of deal-making. For the US, using the OECD methodology puts the talismanic $100bn within reach, defusing an issue insiders say has become utterly intransigent.
A second tortured sore is the balance between funding for “adaptation” – coping with the effects of climate change – and “mitigation”, carbon cutting interventions. Mitigation tends to attract vastly more finance because its profile – renewable energy, forestry, agriculture - comes with readymade business models and can convince private capital to provide additional help. Because of this, mitigation attracts roughly three quarters of all climate finance.

Adaptation and mitigation in climate finance
Adaptation and mitigation in climate finance Photograph: WRI

Adaptation, much of which involves improving infrastructure, offers no such ready profit model and generally requires grants. The African negotiating bloc has called for adaptation finance to reach $32bn a year by 2020. But Kowalzig said that even with new pledges, public adaptation money was only likely to amount to $5-8bn per year in 2020.
“If today’s public adaptation finance were divided among the world’s 1.5 billion smallholder farmers in developing countries, they would get around $3 each year to cope with climate change – the price of a cup of coffee in many rich countries,” he said.


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