Green Climate Fund faces bleak future

By Na Jeong-ju

Rich countries have shied away from using the U.N. Framework Convention on Climate Change (UNFCCC) when they provide funds to developing countries to help them adapt to changing climate, according to a London-based institute.

Industrialized nations promised in 2009 to provide developing countries with $30 billion by the end of 2012. They have channeled only 2 percent of the “fast start” climate finance through funds set up by the UNFCCC, the International Institute for Environment and Development said.

The analysis cast a dark cloud over the envisioned Green Climate Fund (GCF), a U.N.-operated fund to be set up in Songdo in Incheon to finance related activities in developing nations. The GCF had widely been forecast here to draw up to $800 billion by 2020.

South Korean officials worry that the GCF won’t be able to collect the targeted amount by 2020 without full support from donor nations.

The institute said less than half of the fast start finance was provided in the form of grants. The rest is loans, which means poor countries must repay them with interest. Such financing practices usually lack transparency, it noted.

“Without transparency about how and when rich countries will meet their climate finance pledges, developing countries are left unable to plan to adequately address and respond to climate change,” Timmons Roberts of Brown University in the United States was cited as saying by the institute.

The institute claimed that the UNFCCC should play a central role in providing climate finance to developing nations. It said rich countries should channel their climate finance through funds operated by the UNFCCC because it has a governance structure with equal representation from developed and developing nations.

“The poor track record of rich nations in meeting their climate finance pledges has raised serious concerns that they may also renege on their bigger promise to provide $100 billion each year by 2020 to developing nations,” the institute said.

South Korea plans to be a bridge between rich and developing countries in their efforts to reduce dependence on fossil fuels and implement national and local-level strategies and policies for climate change.

In October, the UNFCCC selected Songdo, an international business district in Incheon, as the host city of the GCF. Officials here hope the GCF will enable Korea to play a leading role in supporting projects, programs, policies and other activities in developing countries to fight climate change.