The Green Climate Fund

Abstract

The operationalization of the Green Climate Fund (GCF) has had a slow but promising start this year after the adoption of its governing instrument at COP17 in Durban, South Africa. Agreement on the GCF was a key outcome at Durban, without which the “African COP” would have been considered a failure. The GCF was designed by a Transitional Committee (TC) in 2011, and is expected to become the main multilateral financing mechanism to support climate action in developing countries. It will be a legally independent institution with its own secretariat, functioning under the guidance of and accountable to the COP. The World Bank will serve as interim trustee. Since January 2012 the UNFCCC and Global Environment Facility (GEF) have served as Interim Secretariat, and have been proactive in facilitating the work of the fund. The process of selecting countries to fill the 24 seats on the GCF Board with an equal number of developed and developing country representation has been complex. The Board met twice in 2012, and expects to meet three times in 2013 to tackle more than 50 distinct tasks that need to be addressed before the GCF can disburse funds. Its overall vision, and ensuing “business model”, are key issues to be decided. The Fund’s legal personality will be conferred by an agreement with South Korea, which won the bid to host the GCF. A major challenge for the GCF is to secure adequate and sustained funding. Otherwise, it may be reduced to a beautifully articulated, but largely empty shell. Substantial pledges of long term climate finance are necessary to demonstrate real political commitment to the GCF and secure its viability.