* Any views expressed in this article are those of the author and not of Thomson Reuters Foundation.Caribbean countries hope the new fund will benefit them much more than other global climate finance initiatives
GEORGETOWN, Guyana, May 30 2014 (IPS) - The South Korea-based Green Climate Fund (GCF) is open for business, and Caribbean countries are hoping that it will prove to be much more beneficial than other global initiatives established to deal with the impact of climate change.
"Despite our region's well-known, high vulnerability and exposure to climate change, Caribbean countries have not accessed or mobilised international climate finance at levels commensurate with our needs," said Dr. Warren Smith, the president of the Barbados-based Caribbean Development Bank (CDB).
The CDB, which ended its annual board of governors meeting here on Thursday, May 29, had the opportunity for a first-hand dialogue on the operations on the GCF, through its executive director, Hela Cheikhrouhou, who delivered the 15th annual William Demas Memorial lecture.
But even as she addressed the topic "The Green Climate Fund – Great Expectations," Smith reminded his audience that on a daily basis the Caribbean was becoming more aware of the severe threat posed by climate change.
"Seven Caribbean countries…are among the top 10 countries, which, relative to their GDP, suffered the highest average economic losses from climate-related disasters during the period 1993-2012.
"It is estimated that annual losses could be between five and 30 percent of GDP within the next few decades," he added.
According to a Tufts University report, published after the 2007 Intergovernmental Panel on Climate Change (IPCC) study and comparing an optimistic rapid stabilisation case with a pessimistic business-as-usual case, the cost of inaction in the Caribbean will have dramatic consequences in three key categories. Namely hurricane damages, loss of tourism revenue and infrastructure damage due to sea-level rise.
The costs of inaction would amount to 22 percent of GDP for the Caribbean as a whole by 2100 and would reach an astonishing 75 percent or more of GDP by 2100 in Dominica, Grenada, Haiti, St. Kitts and Nevis, and Turks and Caicos.
"In the Caribbean, the concern of Small Island Developing States is all too familiar – the devastating effects of hurricanes have been witnessed by many. Although Caribbean nations have contributed little to the release of the greenhouse gases that drive climate change, they will pay a heavy price for global inaction in reducing emissions," Cheikhrouhou warned.
Executive director of the Belize-based Caribbean Community Climate Change Centre (CCCCC) Dr. Kenrick Leslie told IPS that regional countries were now putting their project proposals together to make sure they could take full advantage of the GCF.
"The CARICOM [Caribbean Community]heads of government, for instance have asked the centre to help in putting together what they consider bankable projects and we are in the process of going to each member state to ensure that we have projects that as soon as the GCF comes on line we would be among the first to be able to present these projects for consideration."
Leslie said that in the past, Caribbean countries had been faced with various obstacles in order to access funds from the various global initiatives to deal with climate change.
"For instance if we mention the Clean Development Mechanism [CDM], the cost was prohibitive because our programmes were so small that the monies you would need upfront to do it were not attractive to the investors."
He said the Caribbean also suffered a similar fate from the Adaptation Fund, noting "we have moved to another level where they said we will have greater access, but again the process was much more difficult than we had anticipated."
The GCF was agreed at the 16th session of the Conference of the Parties (COP) to the United Nations Framework Convention on Climate Change (UFCCC) held in Cancun, Mexico. Its purpose is to make a significant contribution to the global efforts to limit warming to 2°C by providing financial support to developing countries to help limit or reduce their greenhouse gas emissions, and to adapt to the unavoidable impacts of climate change. There are hopes that the fund could top 100 billion dollars per annum by 2020.
"Our vision is to devise new paradigms for climate finance, maximise the impact of public finance in a creative way, and attract new sources of public and private finance to catalyse investment in adaptation and mitigation projects in the developing world," the Tunisian-born Cheikhrouhou told IPS.
She said that by catalysing public and private funding at the international, regional, and national levels through dedicated programming in climate change mitigation and adaptation, and as a driver of climate resilient development, the GCF is poised to play a relevant and timely role in climate action globally.
Cheikhrohou said that it would be most advisable if Caribbean countries "can think of programmatic approaches to submit proposals that are aggregating a series of projects or a project in a series of countries."
She said that by adopting such a strategy, it would allow regional countries "to reach the scale that would simplify the transaction costs for each sub activity for the country" and that that she believes the GCF has "built on the lessons learnt from the other mechanisms and institutions in formulating our approach.
"To some extent there is embedded in the way of doing work this idea of following the lead of the countries making sure they are the ones to come forward with their strategic priorities and making sure we have the tools to accompany them through the cycle of activities, projects or programmes starting with the preparatory support for the development of projects," she told IPS.
Selwin Hart, the climate change finance advisor with the CDB, said the GCF provides an important opportunity for regional countries to not only adapt to climate change but also to mitigate its effects. He is also convinced that it would assist the Caribbean move towards renewable energy and energy efficiency.
"The cost of energy in the Caribbean is the highest in the world. This represents a serious strike on competitiveness, economic growth and job creation and the GCF presents a once in a lifetime opportunity for countries to have a stable source to financing to address the vulnerabilities both as it relates to importing fossil fuels as well as the impacts of climate change," he said.