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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 F inance
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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