Pledges to GCF are falling short

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Pledges to GCF are falling short

The United Nation’s Green Climate Fund is scheduled to open its secretariat in Songdo, Incheon, in two weeks amid growing concerns of a shortage of funds for the so-called environmental World Bank.

According to a climate finance report by the London-based Overseas Development Institute released Monday, overall pledges to climate funds this year are down 71 percent compared to last year.

The report said that Korea, which has pledged $40 million to the GCF, has pledged more than any other developed nation even though it is not formally registered with the GCF trustee.

In contrast, 10 developed countries, including the United Kingdom, Norway, Germany and Japan, have pledged a total of $6.91 million.

The ODI report added, “There is not enough clarity on the levels of funding that will be entrusted to the Fund.”

Some $356 million has been pledged for international climate funds so far this year compared to the $1.21 billion pledged at the same point last year, according to the report.

The GCF is part of wider efforts by industrial nations who have pledged to boost aid for developing nations to $100 billion a year by 2020 to help combat global warming. But ministers and environmental experts at an ongoing UN climate change convention in Warsaw this week were concerned about being able to raise funds.

Early last month, a meeting of the 24-member GCF board in Paris failed to come up with a timeline to raise new funds. But Manfred Konukiewitz, co-chairman of the GCF board, said in Warsaw Tuesday that things were “on track” and that the fund would be capitalized next year.

The GCF is a multilateral fund agreed upon in 2010 at the United Nations Framework Convention on Climate Change in Mexico. It was launched in 2011 at the UN Climate Change Conference in South Africa with the aim of assisting developing nations to become greener.

In October 2012, Songdo in the Incheon Free Economic Zone beat out bids by five rivals - Germany, Switzerland, Poland, Mexico and Namibia - to become home to the GCF secretariat.

The GCF will be inaugurated on Dec. 4 in the G-Tower building, named for “green” and “growth,” formerly called the I-Tower.

Some 500 people are eventually expected to work for the GCF secretariat by 2020, but a fraction of that number, around 50, will start next year. The processing of selecting official employees will be happening over the next months.

“Until now, the GCF was in an interim phase,” a Ministry of Foreign Affairs official said, “and once it is officially launched, the raising of funds will be addressed more aggressively.”

Many developed countries have expressed their intentions to pledge more, an official from the Ministry of Strategy and Finance told the Korea JoongAng Daily yesterday. He said allocations can depend on the political climate.

He added that the ODI report was misleading.

“The $40 million was a part of Korea’s pledge when it bid to host the GCF,” he said. In contrast, the $6.9 million donated by developed countries can be seen as the amount used in the past year for the operation of the GCF board and the launch of the secretariat.

The budget allocated for the GCF for next year is $19 million, of which 10 percent, or around $2 million, is from Korea, said the official. That ratio is expected to decrease in coming years.

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