The two elephants from Bangkok: differentiation & finance

Three years after the Paris COP21 summit, the international community strives to prove that it can do more than just agree on new principles. This time it is about implementation and setting the rules for the new system applicable to all countries under the Paris Agreement (PA). Will it be possible at COP24* in Katowice? After the additional negotiating session in Bangkok Parties remain cautiously optimistic. Let us see why and whether we can support such optimism.

During the Bangkok session negotiators worked on all of the issues making up the 'rulebook', otherwise called the Paris Agreement Work Programme (PAWP), which resulted in an impressive volume of 307 pages of compiled text. While maintaining balance in progress on all these issues was one of the most frequently reiterated requirements for the success of the climate summit in Katowice, many participants at the session agreed that there are two big issues which haven’t progressed that much.

The first is differentiation – understood as a need to accommodate various stages of current and future socio-economic development of Parties under the PA. The challenge here is not to go back to the developed-developing countries division from 1992 in all the areas covered by the PAWP/rulebook, but to try to ensure that the progressive character of the PA will be reflected in all the particular provisions implementing the agreement. This difficulty was most visible during the discussion on the countries’ climate plans – the Nationally Determined Contributions (NDCs). Across the negotiating table it basically means accepting new obligations by those countries which have not had them so far and/or enhancing those already existing. The extent to which these new commitments could become a burden will be determined in the detail of the decision or decisions to be taken in Katowice at the first meeting of the Paris Agreement’s supreme body, the CMA.

The other one is finance. Here the discussion is not simply about the “how much”. Following the 1992 division, developed country Parties are required to “provide financial resources to assist developing country Parties with respect to both mitigation and adaptation in continuation of their existing obligations under the Convention”, while developing countries can but, importantly, do not have to provide such support. But there is more to this picture. Increasing transparency of expected financial support, its mobilisation, ex-ante and ex-post reporting, targeted areas (mitigation, adaptation, capacity building, etc.) and beneficiaries, as well as timing and assessment, including during the five-yearly Global Stocktake of implementation, are only a few of the things which need to be discussed and finally agreed on – preferably this year at COP24.

Channeling of resources and access to finance add to the list. They are combined with the discussions on the role and efficiency of existing institutions under the Climate Convention, the Kyoto Protocol and the Paris Agreement. The newest of these institutions, the Green Climate Fund (GCF), has been under a lot of scrutiny recently after the US decided to withdraw its support worth USD 2 billion, and the fund’s director resigned at the last board meeting in July. The GCF also failed to agree on mandated issues.

Looking ahead, the next meeting of the current board will take place at the end of October 2018, and its new members are to be nominated by 30 September to start the GCF’s third term on 1 January 2019. For the success of COP24 in Poland, the negative atmosphere around the work, results, as well as elections to the GCF may be detrimental. Knowing that access to and viability of financial support coming from the fund is uncertain, many parties expecting such support may feel reluctant to accept new obligations under the negotiated rulebook. For COP24 it may mean slowing down or even blocking the negotiations in their entirety.

Taking this into account, one possible way to inspire progress before COP24 would be to ensure that the next GCF board meeting is effective, and that new projects are being adopted for implementation. A second, during the summit itself, the High-Level Ministerial Dialogue on Climate Finance, which is to take place in the second week of COP24, could be used to confirm the unwavering will of governments to fulfil their financial obligations. Finally, it is always encouraging to see new financial pledges on the table.

To sum up, after Bangkok we are now certain that differentiation and finance will be the two big elephants filling each negotiating room at COP24, regardless of the subject being discussed. Even without these, the adoption of the rulebook will be a challenging task. Judging from previous COP experiences, we can expect that agreement on these two issues, probably taken at the very end of the summit, will allow for the finalisation of other dependent matters.

Meanwhile, the negotiators in the first week of COP24 will need to do what they can to streamline the existing text into a draft decision or decisions. To help them, a proposal for a new version of what could become the draft rulebook text is expected to be published in October. We can’t wait to see it.

*To understand more about COP24 and the complexity of UNFCCC negotiations the author of this article Lidia Wojtal has written a manual for the Forum Energii** to explain the complexity of this process. Access here.

**Forum Energii is a Polish think tank forging the foundations of an effective, secure, clean and innovative energy system. All Forum Energii analyses may be copied and duplicated free of charge as long as the source and authors are indicated.