Green Climate Fund (GCF), the new multi-billion climate fund, was designated as an operating entity of the financial mechanism of the UNFCCC, in accordance with Article 11 of the UNFCCC. The COP 16 brings the issue into light and after COP 20, now GCF has become successful to a certain extent in initial resource mobilisation process that led to the mobilisation of $10.3 billion to date by contributing parties.
The GCF is expected to play a key role in channeling additional financial resources to developing countries.
Furthermore, it is meant to maximise the impact of adaptation and mitigation actions in a way that it transforms the business-as-usual development with a view to ensuring benefits in a more inclusive and gender-sensitive way. This is the magic and puzzle of the fund.
Bangladesh has been very active in the UNFCCC negotiations for long and has also taken a pragmatic approach as soon as the GCF emerged. In September 2014, the government of Bangladesh nominated Economic Relations Division (ERD) of Ministry of Finance as the National Designated Authority (NDA) of Bangladesh to GCF.
As per standard procedure, NDAs are chosen by governments to act as the core interface between a country and the Fund. NDAs provide broad oversight of GCF’s activities in a country and serve as the point of communication with the Fund.
Funding proposals are submitted through NDAs, ensuring that investments are aligned with local and existing climate change planning. NDAs also provide leadership on the deployment of readiness and preparatory support.
Till date, over 130 countries have selected their NDAs and around one-third of them are Ministries of Finance which shows that governments around the world are increasingly acknowledging the need for engaging the Finance Ministries in the process. ERD, one of the four divisions of the Ministry of Finance in Bangladesh, is responsible for mobilising external resources including the climate finance for socio-economic development of the country.
ERD is officially mandated to interface with the development partners/agencies/ international entities like GCF as long as it relates to mobilisation and coordination of external fund flow in the country.
To begin with, ERD started the process of identifying the potential National Implementing Entity (NIE) in November, 2014 which is a mandatory condition to ensure direct access to the Fund.
This was done in close consultation with the national institutions and through a process of self-assessment of the potential institutions by organising a workshop where 14 national public entities had participated in reviewing their capacity assessment for approaching the accreditation process with direct guidance from GCF representatives and international experts.
Finally, NDA nominated six national public entities as potential NIEs. However, the process is a challenging and time-consuming one but it is possible and opportunities are there to get direct access to GCF.
While pursuing the process of NIE accreditation from the public sector, NDA in Bangladesh also initiated the process for engaging the private sector in the GCF process.
There are multiple opportunities for the private sector in doing transformational business in climate regime. One of the opportunities is to get access to GCF’s dedicated window, “that would support the private sectors to engage into climate change adaptation and mitigation business.”
The aim of PSF is to catalyse clean investments, unleashing private sector innovation, including through small and medium-sized enterprises in developing countries. NDA of Bangladesh with the assistance of other development partners is working with the country’s private sector to make them aware of this opportunity, guiding the advanced private organisations to get them effectively engage in the process.
Getting funds from GCF is the ultimate goal for implementing climate projects and the NDA of Bangladesh started to send proposals to GCF as soon as it opened the route in June 2015. While the NIE accreditation process is in progress, NDA, Bangladesh took advantage of approaching the fund through Multilateral Implementing Entities (MIE) which is known as Indirect Access Route.
Bangladesh is one of the few countries to be able to unlock the Fund at the very beginning and received $40m as grant for its “Climate Resilient Infrastructure Mainstreaming (CRIM) project.” This was one and the largest of the eight projects that GCF first decided to fund globally.
Under this project, 45 new natural disaster shelter and rehabilitation centres in 14 coastal districts with 80km of access roads would be built and another existing 20 centres would be repaired, climate-resilient infrastructures at Satkhira town would be constructed and a Climate Change Adaptation Centre at LGED would be set up. The project will be implemented at a total cost of $80m by LGED.
The second project which has been sent by NDA to GCF for its consideration is “Enhancing Women and Girls’ Adaptive Capacity to Climate Change in Bangladesh.” The project aims to provide cash grants to 40,000 women and 10,000 girls for climate resilient livelihoods, provide large scale rain water harvesters for drinking water, building women-friendly communities, an early warning dissemination system, and capacity building of DWA and Ministry of Women and Children Affairs (MoWCA) to continue climate change interventions.
The project will have a cost of $82.29m of which GCF has been requested to provide $74.45m as grant.
There is a misconception among some quarters as it appeared in some media reports that the project has been rejected by the last GCF board meeting which is not the case at all. Actually, the project has been deferred for placing in subsequent board meetings with a view to address some observations expressed by some board members.
So far, an advisory committee has been formed, a Draft Working Manual has been prepared, and planning of developing an onlineNIE nomination, Project Submission-Screening System has been done.
Very recently, NDA has nominated LGED to get the readiness support for their accreditation purpose. Under this support, Price Waterhouse Coopers would assess their capacity and will assist them to get accreditation.
The NDA of Bangladesh is optimistic about the potential of GCF in transforming the development landscape if there is new and additional international climate funds in addition to the development aid that we get under ODA.
The commitment of the government in climate change is very high and the NDA of Bangladesh calls for greater engagement of all in the fight against climate change in Bangladesh.
The Economic Relations Division under the Finance Ministry of Bangladesh is the National Designated Authority (NDA) for the Green Climate Fund (GCF).