Asian Peoples' Movement on Debt and Development

A regional alliance of peoples’ movements, community organizations, coalitions, NGOs and networks

 

Ecological Debt, Environmental Justice & Climate Change

Green Climate Fund: Updates from the 12th board meeting

The 12th board meeting of the Green Climate Fund was held in Songdo, South Korea last March 8-10, 2016, although preparatory meetings of Civil Society Organizations (CSOs) and the GCF informal meeting began days earlier. 
 
APMDD coordinator Lidy Nacpil is the new Southern CSO active observer in the GCF Board. Other members of the secretariat sent the following dispatches from Songdo specifically for APMDD members and Southern CSOs: 

Day 0: Civil society calls

1. NO to funding fossil fuels and false solutions! NO to HSBC and Credit Agricole!

• Fossil fuel-funding record of applicant entities must be assessed before accreditation

• An emphasis on climate technologies in the draft strategic plan can open the door to harmful technologies

• Full CSO statement vs. HSBC and Credit Agricole as accredited entities: http://webiva-downton.s3.amazonaws.com/877/be/8/7536/3-1-16_no-hsbc-ca-gcf.pdf 

2. YES to prioritizing direct access of developing countries and vulnerable communities! YES to GCF providing for full-cost grant financing!

a. NO to 80% ceiling for grant financing

b. NO to project preparation funding for international access entities

c. YES to Enhanced Direct Access as primary access modality

d. YES to actively promoting gender equality, IP rights and community rights

• None of the 22 projects with more than a 50% chance of getting approved by the GCF Board this year are direct-access proposals from the public sector 

3. YES to gender responsiveness (beyond gender sensitivity)!

a. Achieve gender balance in GCF Board: There are only 3 women out of 24 board members 

b. Fully implement the GCF gender policy and action plan

 

Day 1, 8 March 2016

  • The US announced that they have signed the US$3B contribution for the GCF and that they are sending $500M as first tranche.
  • The entire afternoon was spent in closed-door sessions, which CSOs took advantage of. Lidy convened the Southern groups – Interamerican Association for Environmental Defense (AIDA), Third World Network, Pan African Climate Justice Alliance, Tebtebba, and the Institute of Climate and Sustainable Cities from the Philippines, aside of course from APMDD – to discuss positions, as well as the need to converge regularly for a stronger Southern voice in the GCF process. A CSO caucus with both Northern and Southern groups was held afterwards, where they discussed processes for finalizing intervention points by the observers.

Day 2, 9 March 2016

Newly-accredited entities

These are the 13 banks, agencies, and other organizations which were given the go signal earlier today to access GCF funds, subject to conditions (including a so-called “letter of comfort”).

A. BANKS (15%)

  1. Crédit Agricole Corporate and Investment Bank, headquartered in France
  2. HSBC Holdings plc and its subsidiaries, headquartered in the UK

GCF Songdo March 2016c

Civil society put up a fight against these 2 banks inside and outside the GCF board meeting room. Lidy delivered the civil society intervention which focused on this (she already forwarded the full text, along with a copy of other CSO interventions, earlier). A long and chaotic discussion of the board regarding accreditation followed her intervention.

We may not have been successful in opposing their accreditation, but the Board was pressured to come up with several conditions that the HSBC in particular must comply with; the decision is pending the release of the US money laundering report many of us CSOs referred to in a joint statement.

Our reasons for our vigorous opposition, as Lidy read out in the intervention, are: 

  • Scarce public finance must not be used to subsidize big banks and instead be primarily used to support local communities in developing countries.
  • These banks would pose unnecessarily high risks of the wrong kind to the fund. HSBC in particular is deeply embroiled in massive financial scandal. We firmly believe that the Board should not accredit HSBC due to its poor record on climate pollution, environmental and social harm, and human rights….
  • HSBC and Crédit Agricole provided US$7 billion and US$9.5 billion, respectively, to the coal industry between 2009 and 2014, and their fossil fuel financing does not show a clear downward trend…
  • The accreditation of Credit Agricole and HSBC would represent a clear double standard…. If lack of track record is a problem for [the Ministry of Finance and Economic Cooperation of Ethiopia], why is it that a bad track record is not a problem for HSBC? This is exactly the bias against direct access entities that we are afraid of and that the Fund must rectify.
  • Some board members have said that because the board approved Deutsche Bank, it must also approve HSBC and Credit Agricole. Why repeat the same mistake twice?.... 

We uploaded a video containing an excerpt of Lidy’s intervention: https://www.dropbox.com/s/v5l4tmacrz2grxd/20160309_120624.mp4

B. NATIONAL ENTITIES (38%)

  1. Agency for Agricultural Development of Morocco
  2. Ministry of Finance and Economic Cooperation of Ethiopia (MOFEC)
  3. National Environment Management Authority of Kenya (NEMA)
  4. Development Bank of Southern Africa (DBSA)
  5. Unidad Para el Cambio Rural (Unit for Rural Change, UCAR), based in Argentina 

C. INTERNATIONAL ENTITIES (46%)

  1. African Development Bank (AfDB)
  2. European Investment Bank (EIB)
  3. International Finance Corporation (IFC)
  4. International Union for Conservation of Nature (IUCN)
  5. World Food Programme (WFP)
  6. World Meteorological Organization (WMO)

Webcast of meetings

The GCF board will decide tomorrow on whether or not to webcast the next GCF board meetings live. The US and UK, which opposed webcasting, are part of the team which will deliberate on this. As Liane Schalatek, the Northern CSO active observer, stated in her intervention: “Not allowing Board members to have support via webcasting during meetings perpetuates inequities in participation: some Board members have six or more advisors in attendance while others have none.”

The webcast is actually just one component of the discussions on information disclosure, and part of the wider (and long-standing) CSO call for transparency. Lidy's intervention on HSBC and CA was actually interrupted by a discussion on whether the accreditation process should be done in a closed door session. 

And as you may have noticed in the video clip of Lidy’s intervention, only the 2 CSO observers are allowed in; the rest of our colleagues in Songdo have to watch the proceedings in another room, while everyone else can only follow from emailed updates and from following Twitter updates using #GCFund. This is rather ironic given that South Korea is well-known for the world's fastest Internet and other advanced technology.

Newly-Approved Project

There are currently 124 proposals and concepts in the pipeline for 2016 worth US $6.2B, with only 22 ready for approval. The Board approved today the $1.5M project proposal from the Ministry of Natural Resources of Rwanda (MINIRENA, the accredited entity), Rural Green Economy and Climate Resilient Development Programme (“Rural Green Economy and Climate Resilient Development Programme”).

Gender Side Meeting

CSO observers also attended a side meeting with the GCF secretariat on its Gender Policy. It was an opportunity for CSOs to raise our call of not just having a policy per se, but of ensuring the empowerment of women in pilot programs, and applying the gender policy not only in adaptation but also in mitigation projects.

Day 3, 10 March 2016

Day 3 was the longest day of the 12th GCF Board Meeting. The meeting started at 8:30am and ended at 9:30 in the evening, which is still early compared to previous ones. Most of the sessions were also behind closed doors, exclusive to board members and the GCF secretariat only. CSOs were able to observe in discussions about certain agenda items and the board’s adoption of decisions in the following:

 

 
Information Disclosure Policy

Although there are other items under the policy that needed much deliberation, which the CSOs voiced out clearly in the intervention (e.g. making project and program proposals available on time and to allow public input to assessments, making applications for accreditation public, mandatory provision of access to documents instead of discretionary, etc.) – the discussion revolved around the suggestion to have live webcast of the GCF Board Meetings. As we have shared in Day 2, the US and UK have opposed such move, but the Board decided to give it a go. Starting June 2016 (next Board Meeting in Songdo), until the end of 2017, live webcast will be provided and a review of the said webcast service will be done in no later than March 2018.

Adoption of the Fund’s Strategic Plan

After several consultations of the co-chairs to other board members, the Board adopted its first Strategic Plan. Many of the Board members stressed that the plan should be considered a “living document” which they can revisit and revise any time. The Secretariat was requested to make necessary adjustments in the Board's 2016 work plan to reflect items in the Fund’s Strategic Plan. 

Initial Risk Appetite

The Risk Management Committee presented to the board the updated risk register and the interim risk and investment guidelines. Some of the board members raised concerns as to the limited financing available for public sector grants and the requirements needed for co-financing loans to the public and private sectors. However, the Board decided to adopt the risk register and postpone the decision on the proposed risk guidelines to the next Board Meeting.

The board also adopted the recommendation of the Risk Management Committee to hire an expert, who will work closely with the committee in reviewing the probabilities and impacts of risk categories under different scenarios. 

Readiness and Preparatory Support

The Secretariat gave a short presentation on the progress achieved in providing readiness support to developing countries since the last Board meeting in Zambia (October 2015). As of February 2016, there have been:

  • 139 nominations of national designated authorities (NDAs) in developing countries
  • 110 countries contacted by the secretariat via regional workshops
  • 101 submission of readiness requests, and 60 readiness proposals from different countries
  • 45 proposals are subject for approval, worth USD 11.2 million in total. Of these, 30 are from small island developing states, least developed countries or African states
​​Many of the developing country board members deemed that the distribution of readiness support has been rather slow and that there is a need to simplify the access especially in terms of the necessary legal agreements. During the CSO intervention made by Andrea Rodriguez (alternate CSO Active Observer from the South), we have pointed out that apart from making the readiness funding available, the fund must also:

 

  • Revise the caps on the amount of readiness support that countries can receive;
  • Revise or remove caps on the number of workshops and participants in workshops
  • Allow for direct access accredited entities to receive readiness finance, separate from country caps
  • Make information about the readiness program and details of specific readiness requests available so that country-stakeholders and communities can help to hold the GCF and readiness recipients accountable for the support provided

After discussion of several draft versions, the Board adopted a decision: the GCF Secretariat will “provide advance payments, up to a limit of USD 50,000 to countries or their delivery partners that have signed readiness grant agreements where, in the judgment of the Secretariat, lengthy domestic processes are required to conclude the agreements in accordance with guidelines to be approved by the board.” The mentioned guidelines will be discussed in the next Board Meeting.

Project Preparation Facility

The operationalization of the Project Preparation Facility established in Zambia during the 11th Board Meeting, was supposed to be finalized in this meeting. However, Board Members couldn’t come into a consensus as many raised questions about the 50 Million initial financial allocation for the PPF, and the fact that international entities are entitled to access the amount if there are no direct entities in the country. The Board therefore deferred the decision and asked the Secretariat to come up with guidelines, which will be deliberated in the next Board Meeting. This also means that requests for PPF support will not be entertained until the guidelines are adopted.

Some Administrative and Procedural Decisions

Review of Interim Trustee and Selection of Permanent Trustee – The Board agreed to have an independent third party to review the performance of the Fund’s Interim Trustee, World Bank.  The review will be finalized at the 14th Board Meeting in October.

Performance Review and Selection of New Executive Director – The Board took decisions on the performance review of the Executive Director in executive sessions. They decided to have an ED Selection Committee which will consider potential candidates in time for Hela Cheikhrouhou’s end of term in September 2016.

Next board meetings – The Board agreed to have 3 more meetings by the end of 2016. Tentatively they are set on:
June 28-30, Songdo, South Korea – 13th Board Meeting
October 18-20 Ecuador – 14th Board Meeting
December 13-15 Samoa – 15th Board Meeting
 
CSO Intervention on Berta Caceres
 
Before the 12th GCF Board Meeting ended, Andrea Rodriguez, the CSO Alternate Active Observer from South asked the co-chairs for a final word about Berta Caceres, the IP human rights defender who was recently killed in Honduras. Below is the intervention, which was collectively drafted and prepared by Southern and Northern CSOs, and was​ well received by board members:
 
We would also like to take a moment to remember Berta Cáceres, the Indigenous environmental justice and human rights defender brutally murdered last week in Honduras. She was leading a fight against a dam that threatened her water, her land, and her people. We ask all of you to do whatever you can to secure justice for Berta, and the immediate safe return of Gustavo Castro, head of Friends of the Earth Mexico, who was injured during the assassination and whose life is now in danger. Berta’s murder serves as a tragic reminder to the GCF of the incredible risks faced by rights defenders, and the deep need to safeguard their rights and the rights of the people and land they fight for.  The GCF must not support questionable projects like the one that claimed her life and must obtain in all of its projects and programmes the free, prior and informed consent of people and communities to protect their livelihoods and survival.

 

Tags: Green Climate Fund