Climate finance at COP22: not just a numbers game

Global transition

As COP22 in Marrakech has come to a close, one can clearly note the same ugly issues raising their heads when it comes to financial support for climate action.

Previous blogs in this section have documented throughout the years the diversions of opinion, disagreements of approach and the inherent lack of trust between developing and developed countries when it comes to climate finance. And this blog won’t tell a very different story.

Many countries arrived in Marrakech with a positive sense of energy and optimism. The Paris Agreement had just entered into force, a collection of developed countries published the much awaited climate finance road map, and more and more countries were ratifying the Paris Agreement.

COP22 set out to be an “implementation COP”, where Parties  would work together to build a solid framework of implementation and rules, and incite stronger immediate action between now and 2020. These objectives include finance, in particular the accounting of climate finance so that it is as effective as possible in national and global efforts to address climate change.

However, despite the late night discussions in the climate finance agenda, there was a distinct feeling of sitting on a merry-go-round where Parties repeated positions and specific words, going back and forth on language and semantics.

As the negotiations weaved into their second week, two issues dominated the finance agenda:

1) Long-term finance, which is now actually short-term finance as it refers to the provision and mobilisation of climate finance up to 2020.

The climate finance road map to the $100 billion target by 2020 published by a number of developed countries is a showcase of developed countries’ plans to provide and mobilise climate finance in the coming years. It is therefore very much linked to the negotiations . The exercise of the road map was essential to getting a clearer picture of financial support, and improving the level of predictability and consistency of that support. However, developing countries and NGOs received the road map with a sense of caution. That caution stems from a number of concerns: the methodology used and how it counts types of support provided – for example loans and export credits  –; the abundant shortfall in support for climate change adaptation; and admitted uncertainty about the level of private finance that is and will be further leveraged.

Although the road map is not officially under the Convention, it represents an important element to the discussions that took place during COP22 with regards to providing, mobilising and accounting for flows of climate finance. This is where the clash of perspectives continues to reign. Developed countries seek gratification and endorsement of the road map, while developing countries flag all of the flaws in both the approach to and content of the road map.

The negotiations should have captured the efforts to scale up support, increase transparency and address finance gaps, particularly for adaptation. Though significant strides were made, more work needs to be done to capture meaningful efforts and action. Although developed countries may have compromised on a lukewarm acknowledgement of the road map, this was met with a similar compromise on the part of developing countries as the commitments on scaling up support for adaptation offer no new or inspiring agreements to fill the adaptation finance gap. Such compromises can be construed from the final outcome text.   

2) The fate of the Adaptation Fund, which is one of the many funds serving the objectives of international climate action.

The discussions about the fate of the Adaptation Fund surrounded the question of whether it would serve the Paris Agreement or not. Developed countries have questions and concerns about  whether and how the Adaptation Fund should serve the Paris Agreement. The final decision from COP22 proposed that this should be the case, setting down further and more concrete work for discussing and deciding on the future of the Fund next year. It is important to note that the Adaptation Fund is solely dedicated to adaptation projects and programmes, facilitating support in vulnerable countries where building resilience to climate change is not just a priority but a necessity.

As another COP drew to a close with the backdrop of a Moroccan sunset, the merry-go-round of climate finance continues. But in the spirit of the Paris Agreement, the commitment to converge and agree is evident. This is solidified by the mounting evidence of climate change impacts happening across the world. One of the purposes of these negotiations is to tackle those difficult and challenging issues head-on. With plenty of homework to do, Parties should keep that in mind as they strive to make the Paris Agreement a reality.