Fast trick financing?

15 December 2009

Remember the G8 summit in L’Aquila this year? World leaders proudly offered US$20 billion to tackle the global food crisis. Subsequently it was reported that only US$3 billion was going to be ‘new’ money. The rest had already been committed or was to be handed out as loans.

This scenario makes ECO wonder: How much of the €2.4 billion a year that the EU has now put on the table for fast track financing, over 2010-2012, will be new and additional? ECO’s estimate is that it will be less than 5%. We fear that most of the remainder (EU, prove us wrong!) will come from re-packaging and double-counting previous pledges. ECO requests EU delegates to be transparent and accountable and explain to developing country delegates how much of the €2.4 billion has already been pledged elsewhere.

ECO points out that both fast track finance and long-term financial support in particular need to be committed, and provided in addition to developed countries existing ODA targets. This is because climate finance, which is meant to meet the additional cost of adapting to climate change, is not aid.

The means to overcome double counting is transparency. There has to be clear reporting on what is ODA, what is additional to ODA for climate finance and what has been pledged. Under the Copenhagen Agreement, Parties must agree that funding contributed once as climate finance will not be pledged elsewhere. There is ample opportunity over the next four days to ensure that the five months after the empty coffers of L’Aquila, world leaders will not be making the same mistake again.