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Learn from the experiences of Asia-Pacific countries in managing National Climate Funds (NCFs). Explore the background, structure, and benefits of NCFs, along with case studies illustrating their impact. Understand the decision-making process, design, and management stages of NCFs, emphasizing political feasibility and cost-effectiveness. Discover the importance of transparency, efficiency, and smart investments in leveraging private finance. Gain insights on when to consider establishing NCFs and when to avoid them. This valuable resource provides guidance on maximizing the effectiveness of climate finance mechanisms to support sustainable development.
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National Climate Funds: Learning from the long standing experience of Asia-Pacific countries Silvia Irawan Presented in Regional Clinic on the Design and Management of National Climate Funds Bangkok, 6 September 2012
Background Asia-Pacific Community of Practice on Climate Finance (incl. e-discussion, case study and regional clinic)
e-Discussion on National Climate Funds (NCFs) • Participants: 167 participants (32 countries) with 30 active contributors • Structure of discussion: Run for 10 weeks and guided by a set of questions posted by a moderator • Tools: email and UN Teamworks - a collaborative webspace
Case study: 7 cases • Bhutan Trust Fund for Environmental Conservation (BTFEC) • Cambodia Climate Change Alliance (CCCA) Trust Fund • China Clean Development Mechanism Fund (CCDMF) • Lao Environmental Protection Fund (EPF) • Micronesia Conservation Trust (MCT) • Thailand Energy Conservation (ENCON) Fund • Tuvalu Trust Fund (TTF)
Why are countries considering NCFs? • Overcoming the capacity problem & a stepping-stone • Direct reporting and higher fiduciary standards • Earmarking of government budget • Reaching those who need the funds most • Smart investment & leveraging private finance
Why should countries be mindful about NCFs? Undermining the soundness of: • fiscal policy • fiscal discipline • transparency Extra-budgetary funds do not achieve their intended policy goals
Stages: establishment and management of NCFs Decision making process Designing Management Time
Feasibility Criteria • Political • feasibility • Time and cost effectiveness
The Design • Capital • Legal arrangement • Governing body • Beneficiaries
Management features: • Innovative programs • Project cycle: transparency and efficiency • Working with beneficiaries • Performance based monitoring
The establishment of NCFs can be considered when: • Earmark government budget andreach those who otherwise are likely to be excluded when money is channeled through a formal government system • Smart investment of finances and leverage resources from private sector
The establishment of NCFs should be avoided when: • A duplication of a government function • Only to pool resources from external and domestic sources to finance climate actions
Nationalized sinking fund Endowment Fund Multi-Donor Trust Fund Revolving fund Less More Required Time and Resources