Final Results at the Cancun Climate Talks: Clear Progress on Climate Finance
Posted December 11, 2010
The climate agreement struck in Cancun at 3:30 in the morning today was a significant step forward to reduce global warming emissions and prepare countries to lessen the impacts of climate change. As the Mexican President of COP 16 Patricia Espinosa reiterated throughout the negotiations; agreement on finance was central to the success of the night. The finance package was a deft compromise on short and long-term finance, transparency of financial contributions, and the establishment of the Climate Fund.
The overall package will create a solid foundation to build progress to address climate change. As my colleague Jake Schmidt, International Climate Policy Director for NRDC put it:
Here in Cancun, 193 countries came together and demonstrated a renewed commitment to the fight against global warming. The Cancun Agreements are a detailed set of visionary, yet pragmatic principles that make important strides to begin implementing the agreement reached in Copenhagen last year. The countries gathered in Cancun made progress on emissions reductions, greater transparency, forest preservation and the creation of the green fund to help mobilize much needed investments throughout the world.
The elements of the finance deal struck a balance between the need to quickly establish a major fund to move multi-lateral resources efficiently to the developing world, and the need to provide a robust structure that would ensure funds are governed properly. The commitments from Copenhagen to deliver 30 billion in fast start funds through 2012 and to reach a scale of 100 billion a year by 2020 also needed to be fleshed out in this agreement. Here is how the elements were finally agreed (you can find full text here).
Green Climate Fund
The UNFCCC Conference of the Parties established the Green Climate Fund. There has been waffling on the name of the fund – on Wednesday it was being termed the Global Climate Fund and in Copenhagen it had been called the Copenhagen Green Climate Fund – but nevertheless it was established. The fund will serve a critical role as a mechanism to deliver support for urgent climate actions like reducing emissions through protecting forests, and shifting to greener energy technologies. The fund will also deliver resources to the newly established technology centers which will over research, scientific exchange and technical support for countries looking to improve efficiency and reduce emissions from sectors like energy production, transportation, and buildings.
Many countries highlighted the value of the fund to deliver needed resources on scaled up level for vital adaptation activities. Developing countries are rightly concerned that they have to act fast to adopt new approaches to agricultural, land and water management, education and training, communications, and health systems (to name a few of the sectors that will be impacted by climate change).
In Kenya for example, a country where many people live in rural areas, changing precipitation patterns are already having a damaging effect on crop production and food supplies. Kenya needs support for better precipitation observation systems, improved water efficiency for agriculture and tools to shift to new crops or new areas if necessary. In their remarks on the agreement struck Kenya noted that though the deal was not perfect – the new fund was critical to their ability to adapt to the impacts of climate change and therefore they supported the package. More details on the Fund can be found in my earlier posts here and here.
Transparency of Finance
Trust remained a challenge up until the final hours. But President Patricia Espinosa demonstrated the value in openness and transparency in every element in the climate talks. The text on finance further helped shore up confidence. Developing countries had advocated throughout the year leading up to this meeting of the Cancun Climate Talks for a process to ensure that the delivery of climate finance would be transparent and there would be a system to monitor and verify the promised funds. The final agreement included a new registry to record developing country efforts to reduce emissions and to match those actions finance and technical support. The agreement provides for tracking finance in a common reporting format – something that will enable civil society and recipients of funds to better hold developed nations to account for their commitments.
Short and Long-Term Finance
The COP formalized the Copenhagen commitments to deliver 30 billion through 2012. Currently the United States and European efforts in 2010 to deliver the needed funds along with efforts by Japan, Australia and others demonstrate progress toward meeting the goal. However resources will need to be scaled up in 2011 and 2012 to meet the 30 billion.
On Long-Term Finance there has been work throughout the year since the Copenhagen Climate Talks to identify sources for the needed of increased funding for climate change efforts. The United Nations Secretary General established a High-Level Advisory Group on Climate-Change Financing to look at this issue. They issued their report this November which identifies potential new sources of funds and lays out portfolios which may ultimately serve as the inputs for the Climate Fund. They considered sources ranging from carbon markets, to international transport, a tax on financial transactions and private finance. One of the elements seen to be making the most progress in the talks here is the effort to raise revenues from international transport (shipping and aviation).
The Cancun Agreements as the texts from this morning are coming to be known, noted the report and it will be interesting to see how the meetings in South Africa next year build on the offerings in that report toward progress on meeting the 100 billion commitment.
Progress in Cancun to flight Climate Change
As we just now begin to comprehend the value of the work done in the year leading up to this meeting and the intense two weeks of negotiations here in Cancun – it is clear from the arrangements on finance that we have indeed made progress. It was a tremendous night and though no party was completely satisfied, the progress here will allow critical actions to reduce emissions, and protect people from the catastrophic impacts of climate change. Financing for climate activities will indeed save lives and protect our children from the mounting impacts of climate change. Nevertheless, it seems that this agreement may have done even more to rebuild the spirit of compromise needed for countries to work together on all global challenges. Its great it happened here though – as Espinosa said.
Climate change is the challenge of our century.
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