GCF Board spar over new finance goal outcome from COP29

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New Delhi, 28 Feb (Radhika Chatterjee): Board members of the Green Climate Fund [GCF] sparred over the need to discuss the issue of the new collective quantified goal [NCQG] on finance decision adopted at COP29 in Baku, Azerbaijan last year. The 41st Board meeting was held in Songdo from Feb 17-20, 2025, and was presided over by newly elected Co-chairs Seyni Nafo (Mali) and Lief Holmberg (Sweden).

Several members from the African region, led by Antwi-Boasiako Amoah [Ghana], called for finding a space for discussing the implementation of the NCQG decision and the role that the GCF can play in that regard. In particular, they mentioned the mandate of tripling climate finance outflows and the need for discussing this at the GCF Board, as the Fund is an operating entity of the financial mechanism under the United Nations Framework Convention on Climate Change [UNFCCC] and the Paris Agreement.

[Paragraph 16 of the NCQG decision from COP 29  decided that “a significant increase of public resources should be provided through the operating entities of the Financial Mechanism (which includes the GCF)…” and also decided “to pursue efforts to at least triple annual outflows from those Funds from 2022 levels by 2030 at the latest with a view to significantly scaling up the share of finance delivered through them in delivering on the goal…” Parties also agreed to set a goal for mobilization of finance, “… with developed country Parties taking the lead, of at least USD 300 billion per year by 2035 for developing country Parties for climate action”.]

Henrik Bergquist [Sweden] expressed the need for having new contributors to the GCF and encouraged countries to contribute according to their capacity. This remark was sharply objected to by Mohammad Ayoub [Saudi Arabia], who pointed out that several developing countries have already contributed in the past to GCF on a voluntary basis, but that they should not be pressured to do so. He further added that contributions to the GCF are “historical debts” that are being repaid “due to centuries of historical emissions [of developed countries] and [their] legal obligations”.

The issue of deliberating on the role that GCF in the implementation of the NCQG decision was raised during the discussions held on guidance from COP 29 to the GCF, and the ‘Status of GCF resources.’

Given the divergences of views on the matter among Board members from developing and developed countries, there was no conclusion on the matter on where to discuss the NCQG decision. However, the Co-chairs had indicated that there could be discussion on this at future Board meetings.

Highlights from the discussions

Amoah (Ghana), said this year’s guidance from the COP was “unique” or “different” from past practice because there was some element from the CMA [Conference of Parties Meeting as the Parties to Paris Agreement], which was beyond the COP guidance and needed “additional work”. He said the document presented by the Secretariat lacked a “strong response to the collective mandate” that was established at COP29 through the decision on NCQG, adding that the document is “failing” to align a clear strategy for the GCF with the commitment that was made in Baku. He added further that among the key priorities that the NCQG looks at is a funding strategy that mandates tripling of climate finance outflows. He also mentioned the importance of the GCF in delivering concessional finance and prioritizing adaptation finance. Elaborating further, he said there should be a space [at GCF Board] for discussing the role of how NCQG can be implemented because the Fund as a funding mechanism, has a central role in ensuring that NCQG is fully implemented. Expressing flexibility on where this issue could be further deliberated upon, a few options he proposed were either in the discussion on COP guidance to the GCF or in the discussion on the Board’s workplan. He also mentioned that for the African region, the key issues are reducing the cost of capital for other developing countries and increasing fiscal space.

Henrik Bergquist (Sweden) said “we need even more contributions” [to the GCF] and pointed out that “the Fund has already expanded its donor base over the years” and that it “already enjoys both traditional and non-traditional donors”. He added “we continue to encourage both existing donors to contribute more and countries that are not contributing currently to contribute according to their capacity.” He said “new donors” would bring “very positive goodwill”, and add to the “sense of shared commitment”. Adding further, he said, “every time there is a new donor, it adds further impetus, and incentive to all of us to work together.”

Ayoub (Saudi Arabia), in responding to Sweden’s intervention said, “developing countries have been contributing to GCF since its inception” as can be seen in its initial resource mobilization. He pointed out that “these are voluntary contributions” and that “they are not meant to be pressured to provide more.” Adding further, he said that in the wider climate finance landscape, “between 20-30% in multilateral development banks comes from developing countries on a voluntary basis.” He said further that in the GCF, the term “donors” is not used, because “from our perspective, these are not donations coming from Annex II countries [developed countries under the UNFCCC.]. “These are historical debts repaid due to centuries of historical emissions and legal obligations,” he explained further.

He also said that there seems to be “pressure on developing countries to make up for the contributions of one, the largest historical emitter and the largest economy in the world”, in an apparent reference to the United States [U.S] which had decided to rescind any contribution to the GCF.

Said Ayoub further, “we would ask Annex II countries to apply the same pressure on their partners across the Atlantic and not target developing countries. This is not something we are willing to accept. This goes against the governing instrument of the GCF and goes against the UNFCCC. We have to remember we are an operating entity of the financial mechanism [of the UNFCCC]. This is an unacceptable way to proceed.”

Isatou F. Camara (Gambia) supported comments made by Amoah and said that it is imperative that the GCF actively contributes in operationalizing the NCQG goal. She said that that the GCF has a unique mandate of financing climate action and that the Fund is in a unique position of supporting developing countries with funds that are predictable, adequate, and needs based. This, she said, will be crucial for ensuring that there is efficient climate action in vulnerable countries.

Pacifica F. Ogola (Kenya) added that there is a need for finding time and space to unpack the implications of NCQG decision and other issues related to finance. In this context she mentioned that there are countries that have withdrawn from the Paris Agreement and that this could affect projects and resource mobilization of the Fund [in an apparent reference to the U.S exit from the Paris Agreement].

Joan Frederik Baudet Ferreira Franca (Brazil) asked for the insertion of language relating to enhancement of the provision of technology from developed to developing countries stemming from the COP 29 guidance. He also mentioned the Technology Mechanism in this context and requested the addition of paragraph 110 of the global stocktake (GST) outcome from COP 28, which established a Technology Implementation Programme (TIP).

Lucretia Landmann (Switzerland) said the guidance is the way by which the COP ensures that the GCF implements all the decisions, including the NCQG. Adding further, she said the NCQG should be taken into account in the ongoing policies of the GCF and that she did not support the inclusion of any NCQG related issues in the COP guidance decision.

Pierre Marc (France) acknowledged that the NCQG decision will have consequences in the field of climate finance, and added that “[we are] not pretending that we will not discuss those issues at the Board level, or at the COP”. Elaborating further, he said “we are discussing the COP guidance [to the GCF], which was discussed and drafted before the NCQG decision [was adopted in Baku]” and that he did not understand why the COP guidance that was drafted before the NCQG decision was finalized is being mixed with the NCQG decision. Responding to the proposal made by Brazil for adding language related to enhancement of technology provision, he said, “this sounds like we are trying to renegotiate what was decided at COP29 on the guidance to the GCF”.

Jose Delgado (Austria) expressed support to the Board member from France and recalled that in the context of the COP, discussions focused “heavily” on the need for biennial guidance. He said NCQG and other thematic matters have a “very clear process” that have been established.

Balisi Gopalang (Botswana) supported statements made by his colleagues from Africa and said consideration of the NCQG outcome at the GCF Board was crucial for enhancing climate finance, especially the mandate of tripling finance flows. He said the decision would have implications for the Fund’s programmatic strategy. – Third World Network