New report states that investors need to be less risk- averse if they are to scale up the benefits of their funding.
New report states that investors need to be less risk-averse if they are to scale up the benefits of their funding
New analysis from the Overseas Development Institute looks at how contributions to global green initiatives have been spent over the past decade.
With the Climate Change Conference in Lima still underway, the report states that ‘international efforts to tackle climate change are at a critical juncture’, and aims to find out if climate funds are making a difference.
Overall, the report’s findings are ‘largely positive’, and suggest that climate finance is generally targeting the countries that need it.
According to the ODI, the countries that have received the most mitigation funding are Morocco, Mexico, Brazil, South Africa and India, having each received over half a billion dollars – including about $1.6 billion from the UK.
Despite loud cries in the Mail today that money is going to ‘booming’ economies, these are middle-income countries that have very high, and rising emissions which need to be tackled.
Funding available for climate change adaptation is smaller and has largely gone to poor countries who are vulnerable to disasters associated with climate change.
Bangladesh, Nepal and Niger have been the biggest beneficiaries in this area, each receiving more than $110 million to invest in early warning systems and other activities to enhance resilience.
The ODI cites success in Brazil, where $4 million has been spent so far on three projects. 2,984 hectares of forest have been planted, and more than 4,000 rural producers have been trained in better agroforestry techniques.
It also points out the encouraging involvement of finance institutions within developing countries, especially the Development Bank of South Africa and Brazil’s FUNBIO which are now implementing agencies of the Global Environment Facility.
It is not all good news, however. The report states that ‘ultimately the amounts of funding available have been small, and often difficult to access’, and that procedures to safeguard quality have been ‘extremely cumbersome’. Climate funds have also failed to attract private investors, despite creating specific programmes for these opportunities.
The report make several recommendations for improvement. Climate funds, it says, need to be willing to take more risks and be more flexible, including in developing technology to reduce emissions.
National institutions need to be strengthened, and, crucially, the right types of finance need to be used for the appropriate purpose. This may mean considering grant and concessional funding, or opportunities to support institutional capacity building.
According to the report, national stakeholders have voiced concerns that programmes are reflecting the priorities of the international institutions implementing them, rather than responding directly to the national needs.Like this article? Sign up to Left Foot Forward's weekday email for the latest progressive news and comment - and support campaigning journalism by becoming a Left Foot Forward Supporter today.