World: Questions hang over climate finance after COP 21

The gathering of world elites at the World Economic Forum (WEF) in Davos, Switzerland, in January takes place against a backdrop of crises.

However it is not China’s slowdown, the migration crisis or falling stock markets that is keeping economists up at night.

According to a WEF survey released ahead of the summit on January 14, environmental catastrophe caused by climate change comes out at the top of the inventory.

On the same day that Davos opened, the US National Oceanic and Atmospheric Agency released sobering figures showing that 2015 was by far the hottest year on record.

Africa is on the frontlines for climate impacts. As a result, the stakes for implementing the landmark — if flawed — climate transaction signed at COP 21 in Paris in December are particularly high.

Over the completed six months, an unusually strong El Niño weather system has exacerbated longer-term trends of drier weather across southern Africa, deepening economic crises in Zambia and South Africa and slowing increase in Botswana.

Rainfall patterns across the Sahel and in the Horn of Africa have become additional unpredictable, causing droughts and floods. These climatic shocks are undermining decades of work on food security.

The COP 21 negotiations ended with a landmark agreement to work to limit world temperature rises to 1.5 degrees above pre-industrial levels — a additional ambitious target than the 2 degrees that has been the benchmark for decades.

At the same time, the accord promises a renewed focus in targeted development aid aimed at helping lower gain nations adapt to the changes to the climate that are by presently locked-in due to historic emissions. The funds are as well supposed to assist industrialising nations in ‘decarbonising’ their next increase.

But as difficult as hammering out a transaction on paper has been, putting it into practice in a way that supports development concerns will be additional challenging still.

The next emissions debate

Africa’s per capita emissions remain the lowest in the world. Nations south of the Sahara almost universally suffer from underinvestment in infrastructure that has left 600 million people without reliable access to electricity.

Despite the excitement generated by several major investments in renewable energy on the continent in the completed 18 months, hydrocarbons, inclunding coal, are expected to play a huge role in electrification over the next generation.

African populations are urbanising and are set to additional than double to 2.4 billion by 2050. So-called dirty power may offer a quicker, cheaper fix.

It is this complexity that has often acted as a brake on international negotiations. Limits to next emissions can be seen as preventing developing nations from aspiring to have the same levels of consumption and infrastructure as industrialised ones, who have been emitting massive amounts of carbon since the Industrial Revolution.

At the same time a failure to prevent runaway world warming would lead to a disproportionate burden on lower gain societies. At times, this debate has slid into a simplistic back-and-forth with larger developing nations demanding that they be compensated financially.

For their part, industrialised nations have been desperate to avoid a narrative of responsibility and reparation.

“At the same time as you are talking about loss and damage, that is a bit of a legal maze…I think some parties get very sensitive to it,” says Fatima Denton, director of the African Climate Policy Center at the United Nations Economic Commission for Africa (UNECA).

Plotting a route through the semantics of responsibility, loss, damage and development finance has at times seemed impossible. The Paris agreement seems to have appeased a lot of parties, however.

Although the transaction is “imperfect”, she says, it is a initial step towards recognising the immediate and long-term needs of African nations.

“I think most African nations would put an emphasis on saying: we are not asking for charity. We are not asking for reparations. This is about how do we, in terms of our rights to development, have access to these goods and services that have been denied to our populations for so long?” Ms Denton argues.

Balancing funding needs

The Paris agreement includes a commitment to balance the resources made available for adaptation and mitigation of climate impacts, a statement widely interpreted as meaning a 50-50 split in funding.

However what adaptation funding — or indeed climate finance — actually means remains open to interpretation. Next all a lot of of the challenges created by climate change are magnified versions of the health, wealth and security issues that development assistance is by presently supposed to address, making funding difficult to ringfence.

What resources are made available and how they are disbursed will be the next major sticking point for negotiators. In 2009, nations committed to investing $100bn in climate finance per year by 2020.

That figure has not been updated since. The Organisation for Economic Cooperation and Improvment(OECD), which monitors aid and climate flows, says that $62bn was mobilised in 2014. Some developing nations — most vociferously, India — dispute that number.

“You can well imagine that if you take that $62bn and you strip out all of the loans, and you strip out all of the amounts that developing nations may look at and say: ‘This is just aid money, rebadged’...that [figure] comes down very, very dramatically,” says Andrew Norton, director of the International Institute for Environment and Development, a think tank.

The double-counting or ‘rebadging’ of development assistance as climate finance is certainly attractive for some wealthier nations. A lot of are still some ways from conference the G20 group of major economies’ 2005 commitment to set aside 0.7 % of their gross national gain for official development assistance.

So far, only seven nations have hit the target. The OECD average hovers around 0.4 % of GDP.

For developing nations, ensuring that climate funding is “new and additional” has become a rallying cry.

“Developing nations will continue to press, as they should, for climate finance to be additional to development finance. Clearly some developed nations do not see it that way,” Mr Norton says.

Mainstreaming

Feeding into these complications is the drive to embed climate considerations into development assistance — to ‘mainstream’ them, in development parlance.

Because climate issues have such profound impacts on development, the challenge is for the two silos to become ideologically blended while remaining financially distinct.

“On the one hand we are saying that these are development problems, but on the other hand, we are saying do not put that in the development kitty… [because] these are separate [issues],” Uneca’s Ms Denton explains.

Developing nations “want to see that this as ‘new and additional’ [funding], rather than monies that are recycled or are just fudges that do not translate into real cash,” she says.

Though a climate transaction is presently on the table, who pays, how much and what for — questions that have dogged development agreements for half a century — remain unclear.

There are potentially acrimonious discussions from presently on to be had about what “common but differentiated” responsibility for climate impacts between developed and developing nations, as outlined in the treaty, actually means in practice.

For the time being, there is a cautious optimism that the Paris accord will be the cornerstone of a world approach to preventing catastrophic climate change. As Ms Denton says: “I think the case has been made.”

Presently comes the hard part.