Climate Finance Inflows into the Caribbean

Climate Finance Inflows into the CaribbeanLaunch of the PANOS Caribbean Online Database & Its Establishment as a Regional Hub for Climate Change InformationMontego Bay, JamaicaJune 19-20, 2014

1Pledges to climate funds in 2013 are 71% lower than they were in 2012Nearly sixty cents out of every dollar pledged has now been approved for viable projects.Approved spending for mitigation in the entire developing world in 2013 was only slightly higher than Poland's annual spending on fossil fuel subsidiesFunding to reduce emissions from deforestation and degradation grew to a total of US$ 647 million in 2013, less than was spent on a single highway through the AmazonFunding in response to German flood damage in 2013 was four times higher than the total sum of funding to help developing countries adapt to climate change since 2003Public funding has not yet attracted as much private investment as expected: for every US$1 spent between 2010 and 12, only US$0.25 of private finance had been drawn in as of the beginning of 2012Korea has pledged the most to the Green Climate Fund to date - US$ 40 million - ahead of all developed countriesDespite many meetings, we still don't know where Long-Term Finance - which is supposed to deliver US$ 100 billion by 2020 - will come fromDespite increasing austerity, Europe remains a leader on climate finance, providing 61% of total funds for multilateral finance to dateTotal spending on Fast-Start Finance represents just 1.76% of global funding to respond to the 2008 financial crisis

Source: Climate Finance Update

Source: Climate Funds Update

Source: Climate Funds Update

Challenges in tracking fundsLack of data and varying metric for private vs. public flowsCollective vs. individual reporting ($100 B commitment v. UNFCCC)Disbursements v. CommitmentsDouble countingInflows into the Caribbean

Lessons from Fast Start FinanceThematic Areas Mitigation continues to be a priorityBilateral vs Multilateral UNFCCC Funds remain underutilized Instruments Less reliance on grant financing Prioritization SIDS, LDCs and Africa remain under- served

Green Climate Fund (GCF)Created in 2010 at COP-16 in CancunGoverning Instrument was approved at COP- 17 in DurbanGoverned and supervised by a 24 member Board in Songdo, South KoreaThe World Bank is the Funds Interim TrusteeIts Operational Guidelines have just been approved

GCF - The StructureScale and Impact To make a significant and ambitious contribution to the global efforts to combat climate changeTo promote a paradigm shift and help developing countries transform their economies and put them on a low emission and climate-resilient path.Expected to become the main global fund for climate finance Governance An equal number of members from developed countries and developing countries including dedicated seats for SIDS and LDCsAccessRecipient countries will be able to utilize direct access or access through international and regional intermediaries and implementing entities under the FundAllocation Minimum floor for adaptation financing to SIDS, LDCs, Africa and other vulnerable developing countriesThe allocation of resources will be balanced between adaptation and mitigation activities

What prevents greater uptake?Donor focus on larger emerging economiesBurdensome access criteriaLack of capacity and in-country expertise Under-financing of regional priorities (adaptation)High transaction costsLack of understanding of SIDS issues at the International level Absence of a voice in decision-making in key international financial institutions

Sharon Lindoslindo@caribbeanclimate.bz12