Poor nations dismayed by looming climate aid gap

OSLO/LONDON Sun Nov 11, 2012 1:32pm IST

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OSLO/LONDON (Reuters) - Rich nations are dismaying developing countries with pledges merely to continue aid to help them combat climate change in 2013 despite past promises of a tenfold surge to $100 billion a year by 2020.

"There should be a transparent process to scale up finance" towards 2020, said Seyni Nafo of Mali, spokesman for the 54-nation African group at U.N. negotiations. The poor needed more than "an indication that funding will not fall off a cliff".

A looming gap in aid pledges after a 2010-12 "fast start" programme of $10 billion a year is a big source of tension before U.N. talks in Qatar from November 26-December 7 meant to review progress towards a deal to fight global warming, due by 2015.

The problem dates back to a U.N. summit in Copenhagen in 2009, when leaders including President Barack Obama agreed the fast start programme and set a separate goal of $100 billion in annual aid by 2020 to help the poor to slow global warming.

But no one spelled out what would happen from 2013-19.

Now, with many donors struggling with economic crises, there is little spare cash for climate aid, funds meant to help poor nations to curb rising greenhouse gas emissions and adapt to droughts, floods, heatwaves or rising sea levels.

Major donors -- the European Union, the United States and Japan -- are only giving reassurances about continued aid for 2013, without firm numbers. And they are putting off any surge.

"Finance is key to agreeing on a package at Doha," said Pa Ousman Jarju of Gambia, chair of the 48-nation group of least developed countries. He expressed hopes for "renewed U.S. action on climate change" after Obama's re-election.

Small island states want "scaled-up, new and additional, predictable and adequate climate finance" from 2013, said Samoa's ambassador to the U.N., Aliioaiga Feturi Elisaia.

GREEN FUND

Developing countries want at least new cash for a fledgling, still-empty U.N. Green Climate Fund that is meant to channel aid towards developing nations [ID:nL5E8M59AU]

Christiana Figueres, the head of the U.N. Climate Change Secretariat, said that aid would not fall.

"Governments ... will at least maintain the current funding and they will in Doha look at the path along which they will ramp up to reach the $100 billion of mixed-sources of funding," she told Reuters in Singapore.

Some analysts are not so sure.

"At the very best we are looking at a flat-lining but we fear we will see a fall compared to the fast start finance," said Tim Gore of development group Oxfam. He said Spain, Italy, Greece and eastern Europe would all cut.

Under the U.N. plan, all nations will agree by 2015 a deal to slow climate change that will enter into force by 2020. China, the United States, the EU, India and Russia are the top emitters of greenhouse gases.

EU environment ministers on October 25 stressed "the need to signal to developing countries at the Doha Conference on the continuation of climate finance after 2012". The EU says it is giving 7.2 billion euros in fast-start funds.

A State Department official said Washington was committed to "providing continuity in climate finance" beyond 2012 and to the $100 billion target by 2020. Washington says it gave $5.1 billion in the first two years of fast start.

Japan said it allocated $15 billion for 2010-12, half the fast start total. "We understand the importance of consistency in aid," said a Japanese government official in charge of climate change issues, adding no decisions were made for 2013.

"Donors are conscious they will have to demonstrate that it is not a downward spiral but rather an upward trend," said Ari Huhtala, a director at the London-based independent research group Climate and Development Knowledge Network.

He said that the fast track cash had broadly been achieved but there were disputes about whether it was "new and additional" as promised in Copenhagen.

Many developing countries also say that developed nations have exaggerated fast-start donations -- there is no obligation for the aid to be checked by receipts from poor countries. "There is no mechanism for transparency," said Nafo of Mali.

He said that investments in climate change made economic sense, for instance flood barriers against storm surges. "This is not a developing world problem any more," he said, pointing to signs of more extreme weather worldwide.

A problem is that fast-start aid came from government budgets while the $100 billion will be drawn from as yet undecided sources -- including perhaps novel uses of carbon markets, taxes on aviation, shipping or financial transactions.

"I don't think you can say that there is an emerging consensus on substantive conclusions" about new sources of funds, said Georg Boersting, a Norwegian official who is co-chair of work towards raising $100 billion by 2020.

A group that advised the United Nations once said the $100 billion goal was "challenging but feasible". "I think that's still the assessment," Boersting said.

(Additional reporting by Barbara Lewis in Brussels, David Fogarty in Singapore, Risa Maeda in Tokyo; Editing by Giles Elgood)

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