Tag Archives: climate finance definitions

Unblocking debate on the USD 100 billion climate finance goal

September 29, 2015 |

 

At the Sustainable Development Summit in New York last week, the question of progress toward existing climate finance targets was once again a key point of debate. While mobilizing the USD 100 billion per year that developed countries have agreed to provide to developing countries by 2020 will not meet the climate challenge by itself, it is currently the primary political benchmark for assessing progress on climate finance.

Improving understanding of different stakeholders’ perspectives on what counts towards the USD 100 billion commitment could improve the chances of reaching an agreement. That’s why Climate Policy Initiative’s latest paper, written with Overseas Development Institute (ODI), and World Resources Institute (WRI), aims to untangle the key issues arising in debates about “what counts”, and provide an approach to classifying climate finance in politically relevant ways that can facilitate discussion.

The paper takes no position on what should count towards the $100 billion. It leaves interested parties to draw their own conclusions. We feel it can help at this point in the lead up to Paris because:

  • It distills the debate into five main issues and defines and explores each in depth. They are: 1) Motivation; 2) Concessionality / source (an imperfect but useful conflation); 3) Causality; 4) Geographic origin; and 5) Recipient.
  • It represents each issue in “onion diagrams” organizing different categories into concentric circles according to political consensus. The closer to the center a category is, the more notional consensus there is among stakeholders that it should count toward the goal.

The paper ends by pulling all five variables together into diagrams like the one below that summarize the debate and help interested parties define and discuss what they feel should count.

Unblocking-debate-on-the-USD-100-billion-climate-finance-goal-All-variables

This paper does not attach quantitative estimates to the various categories of flows. This was a deliberate decision. While quantifying flows associated with the various layers and rings of each “onion” diagram is an essential step for future work, we hope that, by encouraging stakeholders to discuss the principles behind their views before focusing on the numbers, this paper may help to de-politicize these debates and support deeper reflection on underlying assumptions and preferences.

Allocating numbers to these flows will, in any case, be a challenge. Poor data quality and availability remain an issue for some variables as do accounting issues that affect how flows of climate finance are being counted by different countries and organizations.

While this paper does not provide definitive solutions on what should count towards the USD 100 billion, it supports deeper reflection on the assumptions and preferences that often underlie international climate finance negotiations. Such reflection may help to de-politicize these debates while fostering better mutual understanding of perspectives.

We also believe the insights highlighted in this paper can also facilitate constructive discussion in other ongoing debates on financing for development, what counts as official development assistance and others. The global community and by extension all countries could benefit from more common understanding.

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