A meeting is being held this week in Berlin, Germany, to discuss an important fund that could provide money to poor countries to help them adapt to a warmer world, build clean energy infrastructure, and avoid further climate crisis. Janet Redman, co-director of the Sustainable Energy and Economy Network at IPS, is a civil society observer at the meeting and an expert on the Green Climate Fund. Lacy MacAuley, IPS media manager, interviewed Redman before she departed for Berlin:
Institute for Policy Studies: Government finance, development and environment ministry officials from around the world will be meeting this week in Berlin to talk about the Green Climate Fund. What is the Green Climate Fund and why is it important?
Janet Redman: The Green Climate Fund is a new financing body that was created by the UN Framework Convention on Climate Change to be a key part of the global fight to stop climate disruption and deal with the unequal impacts of global warming. Right now there are no international institutions that specifically address climate change on the scale necessary to match the magnitude of the problem. Ultimately, we need to transform the global economy in order to solve the climate crisis. That’s what we’re hoping this fund will help do.
A big part of that transformation needs to be building resilience to climate change in the countries that are most impacted, but least financially able and institutionally prepared to cope with those impacts. These are the same countries that are the least responsible for causing the climate crisis. These are the countries of the global South.
The other part of the transformation is about shifting the way we think about ‘development’ so that we move away from a paradigm that says unlimited growth based on extracting and burning dirty fuels is the same as well being. Countries in the global South have the right to develop. We practiced that right in the North . We expect the lights to come on when we flip a switch. People living in poorer countries also deserve to have the lights come on when they flip a switch. But if those countries follow the same energy path that we used to get here – burning dirty coal and oil, razing forests – we’re not going to be able to keep greenhouse gas emissions at safe levels, levels that prevent catastrophic global warming.
IPS: So the Green Climate Fund will help poor countries adapt to climate change, and help them avoid dirty energy?
JR: That’s the idea. The Fund is so important because there’s a need for lots of money, lots of financing – we’re talking about estimates of up to $1.2 trillion per year for adaptation and greenhouse gas mitigation in developing countries – to actually implement the good ideas about new transportation systems, distributed energy, sustainable agriculture, and much, much more that people are drafting. Many developing countries have already articulated in their own plans and their own strategies to deal with climate. But a huge barrier is that there’s just not a lot of funding or institutional infrastructure to move these ideas into action right now.
Countries in the north need to commit to raising the money in innovative and fair ways like taxing financial transactions, taxing carbon, and taking handouts away from fossil fuel companies. Then the Green Climate Fund can do the job it was created for – channeling money from developed to developing nations to deal with the impacts of climate change, to move to low-carbon, sustainable development pathways, and to build climate resilience into the way that they are doing development.
IPS: What is on the agenda at this week’s meeting in Berlin?
JR: Civil society is pretty much in agreement that this fund needs to put the needs of climate impacted and vulnerable people at the core of it’s design, so we’re working to make sure that the Green Climate Fund is centered as much as possible on national level climate plans and that those plans are created in a way that’s truly participatory. A country’s climate plans and strategies should include the government and input from people who are often politically marginalized. Then we need to work out how civil society participates in all the different structures at the national level, and that there’s meaningful public participation at the Fund’s international decision-making board. That’s why more than 70 organizations sent a letter to the GCF’s board members urging them to keep the board meetings open, transparent, and accountable. The Green Climate Fund’s design needs to be an open process, and not a closed-door process.
One of the most important parts of this meeting is that board members will be talking about what they call the “business model” of the Green Climate Fund. We hope they’ll come to agreement about the explicit and specific goals of the Fund will be, and from there we expect them to dig into the controversial issue of whether the Fund will fundamentally be about moving public sector money or private sector money.
IPS: Why should we be watching whether the fund moves public/taxpayer money or private/corporate money?
JR: Focusing on leveraging private sector investment is not the best way to help countries avoid climate crisis. One of our major concern is that we’ve seen financial support from existing private sector institutions like the International Finance Corporation bypass least developed countries, the smallest economies, the poorest countries, or even poor and marginalized people within middle-income countries or larger economies. And adaptation isn’t likely to garner much private sector support because helping poor communities relocate, deal with the impacts of flooding, reduce risks from extreme weather-related disasters is not particularly profitable – nor should it be.
Of course the private sector has role to play in transforming the global economy, but the Green Climate Fund should support local private sector actors, local investors who are interested in developing a sustainable national economy, not attracting large pools of private money from overseas that needs to be repaid to foreign investors.
IPS: How is the so-called “business model” related to this private sector scheme?
JR: The language around developing a ‘business model’ for the fund has been part of the larger slippery slope that risks orienting the fund toward meeting the needs of private sector finance. As I said, the private sector should be one piece of the puzzle, not the go to funding solution. The Fund board needs to work with civil society to understand when it’s appropriate to engage the private sector, and when depending on private investment undermines democratic development and weakens public institutions that are needed to deal with climate change. If this fund is about mobilizing the greatest volume of private investment possible instead of meeting the adaptation and clean energy needs of people in developing countries, then we’re risking not actually addressing the climate crisis. What we’re doing then is making attractive rates of return for private financiers, but that’s not the point of the Green Climate Fund.
The opening paragraphs of the Green Climate Fund document lay out how the fund is supposed to be actively promoting a “paradigm shift.” We’re very concerned that the paradigm shift may be just building more global financial infrastructure, instead of a shift away from exploitation, extraction, and overconsumption. It’s about reducing greenhouse gas emissions globally, but we also need to understand that countries need to develop in ways that leave our planet safe for future generations.
IPS: It seems like the private sector, corporations, and financiers have a lot of voice in these meetings. How are civil society, advocates, and concerned citizens being heard?
JR: Civil society has been given very little space to participate in the development of ideas that are being discussed at this meeting. For example, all of global civil society is being represented by two people – one from the North and one from the South. This means that the specific perspectives of groups that are impacted by climate change and proposed solutions like Indigenous peoples, workers, youth, women won’t be heard. And the two representatives in the room in Berlin will have only limited interventions – three minutes on each agenda item, and then only at the behest of the board chairs.
Other observers will have to sit in an adjacent room watching the meeting over a feed, even though there are rooms in the building big enough to accommodate most observers. And to add insult to injury, the board has so far refused to webcast the meeting, even though it is livestreaming it into the observer holding room.
What that says to us is that the board has not interest in transparency. It seems they don’t want people looking at their process, they want to have a closed conversation. That’s unacceptable. This is a 21st century fund that’s moving backwards from existing standards even in the World Bank’s climate funds – and it’s a fund that we all have a stake in.
IPS: Is there any hope that the Green Climate Fund can be effective, given the challenges and frustrations that you’ve described?
JR: I still have some hope. I think there is a possibility that it could be an institution that could help support countries, empower communities and avoid climate change.
It’s exciting that there’s an institution focused on a “paradigm shift,” since a paradigm shift is really what we need. One thing is clear: This fund should not support fossil-fuel-based technologies or nuclear energy. This fund should not fund megaprojects that displace people and destroy the land. We need a fund that actually does good, not harm.