November 6, 2015 / 11:31 AM / 3 years ago

U.N. climate fund approves first projects ahead of Paris summit

WASHINGTON (Reuters) - A multi-billion dollar fund set up by the United Nations to help poor countries tackle climate change approved its first eight projects on Friday, a key step before a global climate summit starts on Nov. 30.

The Green Climate Fund (GCF), which approved its first $168 million in aid, has $10.2 billion in pledges and is a key ingredient for a U.N. climate accord. The Paris summit runs from Nov. 30 to Dec. 11.

The fund will be one of the main channels for donor countries to mobilize over $100 billion a year in aid for developing nations by 2020 from public and private sources.

“These approvals of the initial projects mark the final building block of operationalizing the Green Climate Fund,” Hela Cheikhrouhou, executive director of the Fund, told Reuters.

“Starting this next phase will send a very positive signal to the international community before Paris.”

Countries that produce most greenhouse gases warming the world have been preparing national plans for cutting emissions and adjusting to climate change, but critics say these would still allow global temperatures to rise to about 2.7 degrees Celsius, well above the 1.5 to 2 degrees target.

Preparatory talks for the conference have been wrangling over the wording of the draft text to be presented there, and rich countries have resisted pressure to commit to raising the $100 billion a year aid target beyond the year 2020.

The first projects selected are meant to spur clean energy technology deployment and strengthen the ability of poor countries to guard against the impact of climate change.The fund approved $12.3 million to improve early warning systems to help Malawi respond to extreme climate events. It also approved $23.6 million to manage climate change-induced water shortages in the Maldives and $217 million for an green bond to spur renewable energy investment in Latin America.

Some civil society groups that participated in the GCF approval process said it was rushed ahead of the Paris summit and lacked transparency. Cheikhrouhou disagreed and said the GCF provided expansive documentation “well in time.”

The eight-project shortlist had been narrowed down from 37 applications and published on the GCF website on Oct. 15. The GCF board’s approval meeting in Zambia started Nov. 2

This left little time for board members, including non-government organizations, to review the projects, said Diane Schalatek, associate director of the Heinrich Boell Foundation North America.

“You have to be extremely careful that you are not setting bad precedents with the first couple of projects that you are looking at,” she said.

The Asian Development Bank (ADB), the first multilateral development bank to work with the GCF, welcomed approval of a $31 million GCF grant to help it finance a $222 million urban water supply project in Fiji.

“We would like to have more projects” with the GCF, ADB President Takehiko Nakao told Reuters. “If we can get more grant money (from the GCF) we can make our project financing more concessional.”

One approved project, which received $6.2 million to improve wetlands resilience in Peru, raised red flags for environmental groups that warned that indigenous communities may not have been properly consulted.

“By taking a hasty decision now - even with conditions around further consultation - the Fund is entering very risky territory,” said Brandon Wu, senior policy analyst for ActionAid USA.

Reporting By Valerie Volcovici; Additional reporting by Megan Rowling with the Thomson Reuters Foundation and Alister Doyle; Editing by Tom Heneghan

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