Show Me The Money!

Finance is a hot issue here in Doha. In case you are wondering why, we need money and we need it fast to enable countries to adapt to climate impacts. There is unequivocal scientific evidence confirming that global warming is happening and most poor and vulnerable countries need finance to deal with its impacts. As this need is increasing each day, countries here at Doha are seemingly unclear about what decisions related to finance will emerge out of COP18. The differences between the developed and developing countries have become more apparent here in Doha and a “trust deficit” has been created, which is slowing down things.

Finance Agenda for COP18

In order to build the trust back, and to ensure a successful outcome in Doha, parties must agree on certain things related to finance:

1. Parties need to make sure and agree that climate finance in 2013 will go up and not down the levels of Fast Start Finance (a finance mobilization period between 2009-2012), and continue to rise to USD $100 bn by 2020.

2. New and additional public resources should be committed, amounting to USD $60 bn.

3. 50% of public finance should be allocated for adaptation purposes.

4. There should be full transparency on common criteria and baselines for monitoring, reporting and verification (MRV) of finance.

5. Generate revenues from innovative sources of finance such as Financial Transaction Tax (FTT) and global carbon pricing schemes on international transport with no net incidence on developing countries.

6. Capitalization of the Green Climate Fund (putting actual money in the fund).schemes with no net incidence on developing countries.

7. Increased political will by developed countries to fulfil their financial commitments.

State of Play

As one of the top priorities of COP18, finance is spread across different negotiating tracks. Discussion on finance is simultaneously happening under the Subsidiary Body on Implementation (SBI), Long-term Cooperative Action (LCA), and COP. A lot of countries have suggested to establish a separate negotiating track to merge all the issues related to finance. The COP presidency has also decided to make a contact group on long-term finance (LTF), which aims to address issues related to mobilizing and scaling up of finance up to and beyond 2020. Most developing countries also called for a political process or a ministerial roundtable to discuss long term finance. So far, the discussion is centring around the reports on the Green Climate Fund (GCF), the Standing Committee on Finance, LTF work program, and arrangement between COP and GCF.

US was pragmatic in the discussions and said it was willing to work on LTF and committed to provide finance after 2012 (oh USA! we love the way you lie). Barbados, speaking on behalf of AOSIS, called for a multilateral and inclusive process. Mexico reminded the countries that they were far way from the objective and need to continue the work program on long term finance. Philippines appeared proactive in the finance discussions and highlighted the fact that the workshops on LTF happened earlier in the year focused more on ’providers‘, but not on ‘receivers‘. It also said that work under GCF was happening on ad hoc basis. Pakistan told the parties that decision on finance could not happen without three crucial elements: institutional mechanism, increased political will, and bringing the right actors in the discussions.

All of these views point out to one thing that things will get pretty serious on finance in coming days. It is certainly going to be a make or break issue in Doha and will be contested by all parties. Any misstep on this issue will collapse the talks. In that case, according to one negotiator, “history will judge the Qatari leadership at the 18th Conference of the Parties on very harsh terms”.