The Congressional Research Service (CRS), the public policy research arm of Congress, recently issued the report International Climate Change Financing: The Green Climate Fund (GCF) (Apr. 16, 2013). The 16-page report authored by Richard K. Lattanzio, discusses the following:
Summary
Over the past several decades, the United States has delivered
financial and technical assistance for climate change activities in the
developing world through a variety of bilateral and multilateral programs. The
United States and other industrialized countries committed to such assistance
through the United Nations Framework Convention on Climate Change (UNFCCC, Treaty
Number: 102-38, 1992), the Copenhagen Accord (2009), and the UNFCCC Cancun Agreements
(2010), wherein the higher-income countries pledged jointly up to $30 billion
of “fast start” climate financing for lower-income countries for the period
2010-2012, and a goal of mobilizing jointly $100 billion annually by 2020. The
Cancun Agreements also proposed that the pledged funds are to be new,
additional to previous flows, adequate, predictable, and sustained, and are to
come from a wide variety of sources, both public and private, bilateral and
multilateral, including alternative sources of finance.
One
potential mechanism for mobilizing a share of the proposed international
climate financing is the UNFCCC Green Climate Fund (GCF), proposed in the Cancun
Agreements and accepted by Parties during the December 2011 conference in Durban,
South Africa. The fund aims to assist developing countries in their efforts to
combat climate change through the provision of grants and other concessional
financing for mitigation and adaptation projects, programs, policies, and activities.
The GCF is to be capitalized by contributions from donor countries and other
sources, including both innovative mechanisms and the private sector.
Currently, the GCF complements many of the existing multilateral climate change
funds (e.g., the Global Environment Facility, the Climate Investment Funds, and
the Adaptation Fund); however, as the official financial mechanism of the
UNFCCC, some Parties believe that it may eventually replace or subsume the other
funds. While many Parties expect capitalization and operation of the GCF to
begin shortly after the November 2013 conference in Warsaw, Poland, many issues
remain to be clarified, and some involve long-standing and contentious debate.
They include what role the CGF would play in providing sustained finance at
scale, how it would fit into the existing development assistance and climate
financing architecture, how it would be capitalized, and how it would allocate
and deliver assistance efficiently and effectively to developing countries.
The
U.S. Congress—through its role in authorizations, appropriations, and oversight—would
have significant input on U.S. participation in the GCF. Congress regularly
determines and gives guidance to the allocation of foreign aid between
bilateral and multilateral assistance as well as among the variety of
multilateral mechanisms. In the past, Congress has raised concerns regarding
the cost, purpose, direction, efficiency, and effectiveness of the UNFCCC and
existing international institutions of climate financing. Potential
authorizations and appropriations for the GCF would rest with several
committees, including the U.S. House of Representatives Committees on Foreign
Affairs (various subcommittees); Financial Services (Subcommittee on International
Monetary Policy and Trade); and Appropriations (Subcommittee on State, Foreign Operations,
and Related Programs); and the U.S. Senate Committees on Foreign Relations (Subcommittee
on International Development and Foreign Assistance, Economic Affairs, and International
Environmental Protection); and Appropriations (Subcommittee on State, Foreign Operations,
and Related Programs). As of April 2013, the U.S. Administration—through its
State,
Foreign
Operations, and Related Programs 150 account—has made no specific budget
request for appropriated funds to be contributed to the GCF.
