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Obama, in latest climate move, to pledge $3 billion for global fund
November 14, 2014 / 2:49 PM / 3 years ago

Obama, in latest climate move, to pledge $3 billion for global fund

U.S. President Barack Obama delivers an address to the Young Southeast Asian Leaders Initiative in Yangon November 14, 2014. REUTERS/Damir Sagolj

WASHINGTON (Reuters) - President Barack Obama will announce a $3 billion U.S. contribution to an international fund to help poor countries cope with the effects of climate change, an administration official said on Friday.

The large size of the contribution took climate policy watchers by surprise and doubles what other countries had previously pledged ahead of a Nov. 20 deadline. It would be the second major move on climate change taken by Obama after big Democratic losses in last week’s midterm elections.

Obama is expected to announce the pledge at this weekend’s meeting of G-20 industrial nations in Australia.

The Green Climate Fund will work with private sector investment and help spur global markets in clean energy technologies, creating opportunities for entrepreneurs and manufacturers including those from the United States.

“The fund will be able to deploy innovative instruments. That is the key distinguishing characteristic of the GCF; it has the opportunity to mobilize significant flows of private capital,” Abyd Karmali, managing director of climate finance at Bank of America Merrill Lynch (BAC.N).

Rich countries had pledged in 2009 to mobilize $100 billion a year by 2020 to help developing countries tackle carbon emissions.

Earlier this week, Obama announced a climate deal with China. The United States will strive to cut total greenhouse emissions by about 25 percent by 2025, while China will aim for a peak in greenhouse gas emissions by 2030.

In the run-up to the global climate talks in Paris next year, developing nations view finance as a vital part of any deal.

Hela Cheikhrouhou, executive director of the fund, lauded the U.S. pledge as a game-changer. “It could have a domino effect on all other contributions,” she said.

The U.S. pledge roughly doubles the $3 billion already promised for the fund, which will hold a first donors’ meeting in Berlin on Thursday.

Germany and France had earlier pledged $1 billion each, and Mexico, South Korea, Japan and others have pledged smaller amounts.

The UN has set an informal goal of raising $10 billion for the fund before a meeting of environment ministers in Peru, next month. Developing nations have been urging $15 billion.

Some environmentalists were unimpressed by the pledge. Friends of the Earth said $3 billion “falls magnitudes below what is actually needed by developing countries.”

Reporting by Timothy Gardner, Ros Krasny and Valerie Volcovici, and Alister Doyle in Oslo and Valerie Volcovici in Washington; Editing by Susan Heavey, Bill Trott and David Gregorio

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