Finance remains crunch issue

4. Dezember 2015 HW

Climate finance is still a major sticking point in the COP21 negotiations. At stake is the $100 billion dollars of annual climate change aid promised to developing countries by 2020. At present, between $5 and 8 billion dollars are in the pot. Now countries such as India demand far more than $100 billion dollars for post 2020.

While the developed countries are not yet willing to put more money for adaptation on the table, NGOs criticise that enough money is actually there.

The G20 spends $452 billion each year subsidizing fossil fuels, but only spends $121 billion on renewables, according to a report published by the Overseas Development Institute (ODI) and Oil Change Institute (OCI).

“The rich countries’ subsidies to fossil fuel producers are locking us into climate catastrophe, but they’re still turning out their pockets and saying that they’re broke when it comes to putting money on the table for the Paris deal. We can shift the hundreds of billions of dollars that countries are spending on fossil fuel subsidies to climate finance—that’s one way to ramp up finance and address the climate crisis”, said Alex Doukas from Oil Change International.

When the latest report by the Organization for Economic Cooperation and Development (OECD) stated that more than $60 billion had been committed, negotiators in Paris have serious doubts that this is new climate money.

Bubu Jallow, a delegate from Gambia representing the world’s 48 poorest countries, asked: “Is it new money, or money diverted from other aid budgets and suddenly labelled climate funds? Is it grants, soft loans or loans at commercial rates? There is no audit, no verification. We do not accept it is real because we have not seen any of it.”

He said: “Of course, countries like China and South Africa are far richer than they used to be, but the 1992 Convention clearly states that it is the developed countries that benefited from the industrial revolution must be responsible for providing the finance and technical know-how to developing countries to help them adapt.“

Responding to the EUs plan to offer financial aid mainly to the most vulnerable states, he said:

“To try to spread the financial load to other countries and restrict finance to only the poorest countries is an attempt to rewrite the Convention, and we will not stand for it.”

A most recent study coming from India revealed that $100 billion dollars of annual climate change aid for the whole developing world is probably not enough. The study comes to the conclusion, that India alone would need over $1 trillion from now until 2030 to adapt to the adverse impacts of climate change.
The study was released by IIM Ahmedabad, IIT Gandhinagar and the Council on Energy, Environment and Water (CEEW). The study identifies India’s preliminary financial, technology, and knowledge gaps in adaptation, as well as capacity building and institutional needs.

Photo: Stop Funding Fossil Fuels