UPDATES: Day 4 of the 39th GCF Board Meeting

You can watch the GCF B39 proceedings live and on demand here: https://www.greenclimate.fund/boardroom/meeting/b39#videos

Full transcript of the interventions by the GCF Observer Network are available here: https://www.gcfwatch.org/resources/board-meeting-resources/39th-board-meeting-of-the-gcf 

DAY 4 – July 18, 2024

The last day of the GCF B39 started with the co-chairs presenting a new decision text on the agenda item Financing for Results-Based Payments for REDD+.  The revised version incorporated provisions on further reducing deforestation and forest degradation, which was aimed to be consistent with the COP decision on REDD+. Many BMs were happy with the new text, with  some emphasizing the value of the updated scorecards to ensure environmental integrity of REDD+ activities. The Board then decided to adopt the decision.

Under the agenda item Consideration of Funding Proposals, the Board was left with a decision to approve FP239 by the African Development Bank (AfDB), which was suspended due to disagreements on the recommended conditions set by the Independent Technical Assistance Panel (ITAP). The BM from the United States also had an objection to the approval of the project due to the US’ federal policy that mandates no support be given to countries engaged in human trafficking, which some of the FP’s beneficiary countries are part of.

The table below details the Board’s discussions on FP239:

FP239: Building Climate Resilience for Food & Livelihoods in the Horn of Africa (BREFOL) 

Proposed by: African Development Bank (AfDB)

To be implemented in: Djibouti, Ethiopia, Kenya, Somalia, and South Sudan

Cross Cutting

Category B Risk (Moderate)

Total Financing: 335.30 million USD

GCF Financing: 151 million USD (60.30 million USD (senior loans); 90.70 million USD (grants))

Co-Financing: 184.29 million USD (42.90 million USD (senior loans) from African Development Fund; 123.54 million USD (grants) from African Development Fund; 0.69 million USD (grants) from FAO; 16.03 million USD (in-kind) from governments’ contributions; 1.82 million (in-kind) from beneficiaries’ contributions)

The GCF Secretariat presented their proposed decision text, based on bilateral consultations with dissenting Board Members and the accredited entity, the AfDB. It can be recalled that the BM from Sweden strongly advocated for the submission of fragility studies and a monitoring and evaluation plan as conditions for disbursing funds to the project.

BMs from least developed countries (LDCs), Mali and the Gambia, objected to the proposed decision text by the Secretariat. They argued that while the AE agreed to the conditions, beneficiary countries of the FP should receive capacity-building support instead of being asked to comply with a number of unrealistic conditions. The Secretariat assured the Board that the AE and beneficiary countries would receive capacity-building support to help meet the required conditions for disbursement.

While the Board had consensus on the conditions, the objection of the BM from the United States remained. The co-chair stated that all means to reach consensus had been exhausted, prompting the Board to proceed with the voting process. The Board Members were asked one by one if they were in favor of the approval of the project, and only the BM from the US objected. FP239 was then approved.

APPROVED

The Board also moved to adopt the overarching funding proposal document. The Secretariat reported that 10 of the Funding Activity Agreements would be signed during B39, with the first disbursement of funds commencing within 15 days. This is a result of previous Board policies aimed at streamlining GCF processes.

This was then followed by the outstanding agenda item Partnerships and Access Strategy, which was opened on Day 1, allowing a number of developing country BMs to raise concerns about the policies affected by the draft Strategy. Bilateral consultations were then conducted by the Secretariat and they presented a revised decision text for Board consideration on Day 4. While some developed country BMs were satisfied with the new text, some developing country BMs believe it failed to capture their views.

The BM from Pakistan raised an important point from the IEU Synthesis Report on Access. The report says countries with strong MDB project portfolios are favored and that streamlining the accreditation process is not the only measure to enhance accessibility to the Fund. Other developing country BMs agreed with the relevance of the report findings and urged the Secretariat to revisit the IEU report as they develop the Fund’s Partnership and Access Strategy.  The BM from Mali added that instead of grand strategies, the Board must follow a systemic approach, where an in-depth analysis of the gaps pre- and post- access is conducted, which can be done through consultations with NDAs, DAEs and stakeholders.

Kairos dela Cruz, Active Observer (AO) from developing country CSOs, reiterated the GCF Observer Network’s concern about the lack of direct access provisions for civil society, local communities, and indigenous peoples in the revised draft Strategy, as well as the insufficient consultations done with stakeholders in developing the Strategy. This concern was echoed by the BM from Saudi Arabia and other developing country BMs, citing that the strategy focused on consulting NDAs and DAEs only. The CSOs also argued that the revised draft Strategy risks diluting GCF policies if it advocates for principles-based policies instead of the current rules-based ones. The Secretariat did not address any of these concerns.

With still a lot of unresolved concerns, the co-chair suspended the consideration of the item to allow further consultations with developing country BMs. The Board did not adopt the item and the co-chair instructed the Secretariat to consider the points from B39 discussions and consultations in further revising the document. However, it was unclear when the item will be tabled again for Board consideration.

The agenda item Action Plan on Complementarity and Coherence, was also revisited by the Board. It can be recalled that on Day 1 the item received comments from developing country BMs about its vagueness and lack of proper consultation, prompting the Secretariat to do further consultations with the concerned BMs. On the last day of the Board Meeting, the Secretariat presented a revised draft decision that included the Board’s request for the Secretariat to communicate the discussions at B39 to other multilateral climate funds (MCF) and reflect the said discussion in the revised Action Plan. The Secretariat was also instructed to provide a progress report on the revision. After seeing the revisions, the decision text was adopted by the Board.

Several evaluations done by the Independent Evaluation Unit (IEU) that were supposed to be discussed at the previous Board Meeting, were also tabled at B39. These included the Independent Evaluation of the Investment Framework and the Independent Evaluation of the GCF’s Approach to the Energy Sector, both documents the Board is requested to take note of and the IEU to submit corresponding management action reports no later than a year following the adoption of the items.

The discussion on the Investment Framework began with IEU Head Andreas Reumann presenting key findings. These indicated that while the GCF’s investment framework aligns with the goals of USP-2, it needs more calibration to align policies with the evaluation tools. The IEU recommended simplifying and clarifying the investment framework priorities, aligning specific policies like the Risk Management Framework and the Integrated Results Management Framework, and improving the monitoring and accountability framework in addition to filling other policy gaps. The GCF Secretariat disagreed with some of the IEU’s findings and recommendations but noted that the decision ultimately lies with the Board.

Tara Daniel, CSO AO from developed countries, stated that the GCF Observer Network appreciates the evaluation but disagrees with consolidating the paradigm shift into other priorities. The Observer Network emphasized that the paradigm shift should be distinct from country ownership and sustainable development potential, contrary to the IEU’s recommendation. The CSOs also echoed the IEU’s findings that the Fund must strengthen its post-project approval monitoring and accountability and reiterated the need to include CSOs, indigenous peoples, and local communities in consultations if the Investment Framework is revised.

After much debate, the Board noted the evaluation and instructed the Investment Committee to make recommendations based on the evaluation and the Secretariat’s response.

Due to time constraints, the Board decided to postpone the presentation of the Independent Evaluation of the GCF’s Approach to the Energy Sector and instead adopt a new decision text proposed by the BM from Saudi Arabia. The new text requested the Board to note the factual inconsistencies and inaccuracies of the evaluation and invited substantive written comments from the Board.

Before the Board arrived at a decision, Kairos dela Cruz expressed the GCF Observer Network’s disagreement with the IEU’s recommendation to report adaptation benefits from energy projects, stressing that adaptation must be intentional and not declared merely to achieve adaptation metrics. The CSOs also emphasized the need to increase the ambition of energy projects regarding improving women’s access to energy, as the IEU evaluation cited a low percentage of increased access for women. 

Following this intervention, the Board adopted the new decision text for this agenda item.

With regards to the Dates and Venues of Upcoming Board Meetings, the Board agreed on the following dates and venues, save for an abstention from the BM from France:

  • B40 on October 21 to 24, 2024 in the Republic of Korea
  • B41 on February 24 to 27, 2024 in the Republic of Korea
  • B42 on June 30 to July 3, 2025 in a location outside of the Republic of Korea, to be decided by the Board upon the Secretariat’s recommendation
  • B43 on October 27 to 30, 2025 in the Republic of Korea

During the final minutes of B39, the Board quickly went through the agenda item Report of the Meeting, where the Co-Chair from the UK recalled that decisions adopted at B39 will be compiled and transmitted to the Board, per standard practice. The Co-Chairs also decided to skip the agenda item Launching the Third Performance Review of the Green Climate Fund, proposing the matter be tabled at the next Board Meeting.

The 39th Board Meeting of the Green Climate Fund then concluded at 5:15 PM Songdo time.

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