U.N. climate $100 billion fund rifts linger, Durban talks loom

Countries are still squabbling over how much power a United Nations fund will have to help developing countries tackle climate change, just weeks ahead of a crunch summit in South Africa to work on a global climate deal, an EU negotiator said.

Last year, countries agreed to create the “Green Climate Fund” to channel up to $100 billion a year by 2020 to help the world’s poorest countries limit greenhouse gas emissions and cope with the effects of rising sea levels, floods and other extreme climate impacts.

Last month, a U.N. committee completed the draft design of the fund at a meeting in South Africa.

 Governments are struggling on how to find any money to put into that fund 

Christian Egenhofer at the Centre for European Policy Studies, a Brussels think tank

Negotiators from around the world will consider the proposals at a climate summit in Durban from Nov. 28 to Dec. 9, as they try to agree on steps towards a global binding climate deal.

The United States and Saudi Arabia have raised some objections to aspects of the fund’s design, Laurence Graff, head of the international and inter-institutional relations unit at the EU Commission, said on Friday.

“The nature of these objections ̶ whether they are serious concerns or (the two countries) wish to add to recommendations ̶ remains to be seen,” Graff said.

The United States and some other nations want the World Bank to have a central role in managing the fund but some developing countries and environmentalists are against, arguing that it does not have the right environmental credentials.

“The issue is indeed whether the fund should be allowed to carry out its own projects without resorting to the World Bank,” she said.

“That is still open (to discussion).”

Another related issue has been driven by some rich countries which insist the private sector should be the main source of climate finance, as governments struggle to raise enough public funds in constrained economic conditions.

The rift over the public-private role could shake developing countries’ emissions cut ambitions if a resolution is not found, said Christian Egenhofer at the Centre for European Policy Studies, a Brussels think tank.

“Governments are struggling on how to find any money to put into that fund,” he said.

“If the money cannot be found it gives me concern on the level of targets developing countries are able to take in future if the finance is not there to back them up.”

There are concerns that these ongoing rifts could threaten to derail the fund's launch, seen in 2013.

“There are a number of issues (related to the fund) to be discussed in Durban, including at the ministerial level,” Graff said.

“Overall, my impression is that the (design) proposals are a good basis for discussion and I am hopeful we will be able to ensure a good outcome.”