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Report calls for collaboration to streamline use of climate funding

By Maram Kayed - Feb 18,2020 - Last updated at Feb 18,2020

AMMAN — The distribution of climate financing among countries in the Arab region is “highly uneven”, with 94 per cent of bilateral flows reported in 2016 reaching only five countries, namely Jordan, Egypt, Qatar, Morocco and Tunisia, according to a report recently released by the United Nations Economic and Social Commission for Western Asia. 

The report, titled "Financing Climate Action in the Arab Region: A Technical Report", indicated that "the division of previous financing is also uneven”, although the total financial flows to the region to address climate change increased by 162 per cent from $1.8 billion in 2015 to $4.6 billion in 2016.

Although Jordan is among the countries that received the most financing, the report still stated that  "the international climate financing allocated to Jordan and the Arab region do not meet its needs, neither in terms of quantity nor quality”, and that the multilateral climate funds have “a limited impact”. 

In 2015, the International Investment Guarantee Agency set climate change as one of its primary priorities, and since then, funds earmarked for climate change-related projects have increased from $3.7 billion in 2015 to $4.2 billion in 2017.

In 2015, Jordan obtained a guarantee for 19 years that covers up to $216 million of the commercial debt for a gas-fired power plant.

“The problem is that there is a gap in creating channels between different governmental entities and other concerned parties. There is simply no collaboration to the point that when delegations represent Jordan abroad, as each one presents their case individually,” climate change expert Safaa Jayousi told The Jordan Times over the phone.

 “The way to fix this is not to create yet another committee within a ministry or entity, but to create a task force that includes the government, NGOs and civil society organisations on a nation-wide level,” she added.

The expert also noted that a "critical" means to improving action against climate change is monitoring funds and following up on the projects they are designated to finance.

The results of the report indicated that “loans go far beyond grants, and this makes access to climate finance more difficult for heavily indebted countries, especially for those that need higher shares of grant support, such as the least developed Arab countries".

“Projects that do not create direct cash flows to repay loans reach only about 2 per cent of climate finance,” it added.

The report stressed that a more comprehensive solution is needed to mobilise resources for Jordan and for countries around the world, “at a time when there is no clear definition of climate change", to distinguish between related funding, development aid, humanitarian aid or even security expenditures (such as peacekeeping).

Omar Shoshan, Chairman of the Jordan Environmental Union, told The Jordan Times: “Climate change funding to the Kingdom is usually part of the support meant for humanitarian aid or assistance to the agricultural and water sectors, which robs climate change of a dedicated fund."

During his participation in the recent Madrid-held UN Climate Change Conference COP 25 on climate change, Shoshan met with representatives of other Arab states and explained how Jordan, an important host country for refugees, “deserves attention due to droughts and other effects that the increased use of natural resources has on it”.

He added that, at the moment, there is no “accreditation entity” authorised to receive climate change funding from international donors, but that the Kingdom is currently working with banks to establish one.

According to the report, this creates a risk of double-counting official development assistance, humanitarian aid and even security spending as climate finance.

Private financing represents two-thirds of the financial flow reported by the United Nations Framework Convention on Climate Change, but it is not known to what extent the contribution to climate action per dollar of private investment is comparable to the contribution of each dollar to public spending.

The report also stressed that private financing is not always considered an appropriate alternative to public spending, while there are important opportunities to involve the private sector in promoting public policy goals.

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