World Bank's Climate Investment Funds 4 years later Learning lessons for the UN's Green Climate Fund
The board of the UN Green Climate Fund (GCF) will be meeting for the first time ever next month. With the operationalization of the GCF, the World Bank’s Climate Investment Funds (CIFs) are expected to sunset. When the CIFs were launched in 2008, World Bank President Robert Zoellick said, “We think the CIF will have a significant impact in generating even more financing for climate action but also in demonstrating new approaches to address the current and future effects of climate change.” Have the CIFs succeeded in these efforts? What should the GCF replicate and what should it avoid? Now is the time to ask these questions and examine lessons learned.
· Red Constantino, Institute for Climate and Sustainable Cities -- Clean Technology Fund, Asian Development Bank, and the Philippines
· Sarah Little, Gender Action -- Gender impacts of the Climate Investment Funds, with an emphasis on the Pilot Program on Climate Resilience
· Karen Orenstein, Friends of the Earth US -- State-of-play: Green Climate Fund and Climate Investment Funds
· Titi Soentoro, Aksi - for gender, social and ecological justice -- Forest Investment Program and Indonesia
· Srinivas Krishnaswamy, Vasudha Foundation
Sponsoring organisations: ActionAid, Bretton Woods Project, Friends of the Earth US, Gender Action, Institute for Climate and Sustainable Cities, Institute for Policy Studies, ‘Ulu Foundation
Karen Orenstein, FoE:
- A CSO letter on the CIF sunset clause and the need for commitments to the Green Climate Fund (GCF) with 115 signatories has been sent to donor countries (see Karen’s blog piece for more info)
- The Green Climate Fund (GCF) meets first time end May
- Lots of reasons for concerns, but also some hope
- FoE will pay attention to the role of the private sector in GCF, safeguards country ownership, attempts by US to distance GCF from UNFCCC and sourcing of funds
- Quick CIF overview: 2 funds, Clean Technology Fund (CTF) – mitigation, primarily middle income countries, and Strategic Climate Fund (CTF) – an umbrella with three sub funds, Forest Investment Programme (FIP) – large scale investments to reduce deforestation and forest degradation, Pilot Programme on Climate Resilience (PPCR) – adaptation and integr climate relilience and risk in development, Scaling up Renewable Energy Programme – low carbon development in the energy sector, private sector and energy access
Red Constantino, Philippines
- Presentation on climate finance and country ownership, Philippine and CTF etrikes controversy
- CTF intro, includes 12 countries and one region, promotes scaled up finance for low carbon technologies with significant potential for long term emissions savings and “transformational” strategic purposes
- Philippines is part of the programme, including a number of initiatives involving various IFIs and MDBs, and to leverage other sources of financing, endorsed in 2009
- In Philippines, reallocation of funds from renewable energy efficiency towards energy efficient appliances and EEEV (energy efficient electric vehicles – tricycles)
- But serious stalemate due to steps taken to shortcut the process.
- Lots of questions, due to mainly being pushed by the Bank (or some Bank officials)
- Originally plan for roof top solar projects, but funding diverted to etrikes, due to the supposed ease how it could be implemented and be more effective
- This is largely true on surface, an important initiative, but issues coming from all sides, incl private sector, civil society, government agencies, academia, largely due to lack of consultations with any of the sectors, including the government
- No consultation with the energy sector, even though funds diverted from there
- No civil society consultation
- Not even electric vehicle industry consulted. Country had been involved in electric vehicles since 2005, despite claims it had no experience
- Two dimensional understanding of the problem, throw money and technology at it and assume the price will drop – but other factors need to be taken into account
- Lack of consultations largely to do with unverified figures and assumptions
- Solar roof tops is also a bad idea, which could have been blended with other types of finance to be more efficient
- Question why etrikes, why not other forms of vehicles? “Lack of alternatives” unverified
- ADB plan crowds out the privates sector using subsidized credits
- Etrikes project imposing process chaos in the bureaucracy
- Country ownership far from established
- ADB subverted consensus and ownership process thrice
- CTF trust fund committee itself undermined by March 2012 “consultative report” submission by the Philippine government and ADB which deliberately misrepresented CSO and private sector views
- Shows how easily country ownership can be undermined by arrogant MDB
- Tighter safeguards are needed, in particular looking at the MDBs and the GCF in the future
Titi Soentoro, Indonesia
- Presentation on Indonesian FIP – business as usual
- Grant plus loans, approx half half, falling under ministry of forestry, with a directorate implementing the programme
- ADB, WB and IFC involved, all with a history in Indonesia
- ‘Fishbone analysis’ to identify source of deforestation and forest degradation, eg land concessions main problem, eg in relation to agriculture, mining
- Based on analysis issues around ineffective spatial planning, weak tenure, ineffective forest management, etc
- Developed eight strategy points, incl community forestry, land and forest tenure reform, forest law enforcement and illegal logging
- Three main interventions developed from these also to bridge financing for readiness reform etc
- Three project and program concepts: ADB, WB, IFC
- Indonesia postponed its proposal to CIF sub committee from May this year to probably Nov
- There is an NGO stakeholder chamber, but the draft published in March didn’t reflect their comments – eg didn’t agree with loan component, said FIP should prioritise to solve tenure issues as key issue to forestry sector in Indonesia
- Letter sent by civil society in February, arguing no promotion of non market sources, concern re debt burden of the country, no effective dialogue with stakeholders in the eight chambers of stakeholders
- Important governance and tenure issues not reflected in ‘fishbone analysis’ – lot of corruption, lots of money distributed to other objectives, military intervention, logging concessions to cronies and operations in land conflict areas
- FIP is under WB safeguards, but ADB safeguards should be applied in all ADB operations – incl gender and development policy. Currently ADB safeguards is better than WB – hence there are now weaker requirements to protect people
- FIP is under ministry of forestry, but no lessons learnt of past reforestation fund
- Not effective in addressing the underlying causes of deforestation and forest degradation – eg expansion of plantations, mining and infrastructure projects, illegal logging and other forest crimes by big scale companies, carbon trade and economic benefits driven
- Ignores rights to information, rights to decision making and women’s human rights and FPIC in its drafting process
- Insufficient information disclosure: eg two weeks to give comments and only documents in English – leading to civil society sending protest letter
- Troubling pattern of consultation: last minute invitation, fake consultation processes, etc
- CSOs also complained regarding the FIP joint mission in July 2011: short notice invitations (eg two days for partner consultation), and lack of clarity about criteria and processes
- No compliances with requirement of gender considerations in ADB Safeguards
- Ignorance to militarisation of climate changes projects that potentially increase state violence and human rights violation – e.g. the “green and green alliance” with the military
- It is market driven, with potential to increase human rights violations, contribute to militarisation of forest projects through indirectly financancing Indonesian military operations.
Sarah Little, Gender Action
- Presentation of PPCR gender analysis through evaluation of SPCR (see Gender Action’s website)
- Important with gender analysis as women and men hold different roles, and therefore need different mitigation and adaptation measures – important including women in decision making
- Gender and human rights - generally fairly well recognised in terms of the impacts on security for example, but few explicitly mentions gender
- Gender equality - most recognised but few try to aid on all levels, including bad example in Niger, analysis doesn’t include why women are affected and how they would be empowered as part of the programme
- Little use gender disaggregated data
- Gender in context – most recognise gender walls, but wide variability on how it is addressed, Cambodia good example with gender goals in all projects, one project directly aimed at women
- Gender access – Bangladesh bad example, climate proof market but only 15% to women and no analysis why this figure
- Gender inputs – most try to include genders in consultation, but varied women in decision making, transparency lacking
- Gender outputs – hardly no long term efforts to improve situations
- Recommendations include: climate change finance should be provided as grants, CIFs should acknowledge general impacts of climate change, prepare gender responsive budgets, and affected women and men should be included in consultation and decision making
- Understand some of the frustrations about the short comings, will give other perspective
- Two broader issues that cuts across the funds discussed:
- Consultations, quality and depth, and numbers – agree we have to do better. It’s clear it wasn’t done properly; need to ensure meaningful consultation takes place. Also inputs need to be properly taken into account. Feedback is important on why inputs has or hasn’t been included.
- But also some confusion regarding consultation process. An investment plan (IP) is a planning document, not a project document, outlining the broad issues. From that come the projects. So approval of the IP and should be discussed at that level, regarding overarching priorities and so on. When projects are prepared, more consultation are needed at the project level. Sometimes the project offices weren’t ready to discuss as the details weren’t there.
- Regarding government ownership, is it driven by MDBs or the government? Difficult question, sometimes the governments aren’t ready yet in terms of climate change strategy. Eg Vietnam is still behind. Climate financing has moved ahead of the government infrastructure to handle it. Many governments hadn’t figured it out, they are learning and have come a long way. The government ownership has been pushed to address these issues. Also difficulty identifying where it sits within the government. Elements of capacity and readiness for planning needed.
- Can’t go into project details re Philippines, but at the last meeting in Manila there was a plan for moving things forward – if this is not the case then we have some more work to do.
- FIP in Indonesia, legitimate concerns, but FIP is only 70 million dollars, what can you realistically do with this sum? Broader context of work in the forestry sector, eg Norwegian money, others coming in to co financing. FIP needs to ride the wave, it’s only a small component, can’t do much.
- Gender – CIFs have evolved, investment plans with gender was never made to be a big part of CIFs, but big push lately. Better performance with the later investment plans. Issue of continuous improvements. What do we do with the old ones, do we need to go back and fix them – that’s part of the discussion
- Sunset clause – MDBs shouldn’t have a position, MDBs are the deliverers of what the bosses, the trust fund, say should be done with the funding.
- Dialogue welcome, lots can be done and in different ways, to move forward in a meaningful way.
- SREP should have two distinct aspects, maximise energy mix and provide affordable sustainable clean energy access
- Need different approaches that complement each other
- Energy access, decentralised energy solutions - grid not essential but could be done, need to complement each other
- Problem largely focused on lighting programs, and some on improved cook stoves.
- But not just lighting is required, holistic solution for affordable sustainable clean energy access linked to development – addressing economic and social issues, incl livelihoods
- Energy as a driver to mitigate the hardship largely felt by women and children
- Financing, more decentralised systems needed to leverage maximum finance
- Public financing also needed to leverage private investments
- Private sector involvement difficult for affordable access, so need public financing
- Key to solution to set up pilots scaling up of affordable clean energy access.
- We’re not confused regarding the process requiring safeguards policies, they should be applied in ADB projects, as well as gender policy
- Yes, $70m is small sum, can’t give solution to all problems, but could contribute to worsening of the situation.
- Big focus on CTF as strategic fund, concessional loans is strategic and could be used for more transformational things, but its used badly
- One big lesson for GCF on etrikes, the trust fund committee process actually works. Letters got responses, confirming no approval until after consultation. MDBs undermined the trust funds work too, as consultations are required.
- Quality of consultations, generally quarry on what meaningful consultation means, but here there was none – not yet happened.
- Hard to say IP discussion is different to projects, as the ADB was already pushing the etrikes.
- Consultations can’t happen in a take it or leave it approach
- Bank needs to take this seriously, measures need to be taken to put things in writing
- timeline not the only explanation to gender impacts, not that clear cut
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Published: 20 April 2012 , last edited: 20 April 2012
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