By Justin Worland
June 13, 2017

Much of the fallout from President Trump’s withdrawal from the Paris Agreement has centered on the symbolism of losing the world’s largest economy and second largest emitter of greenhouse gas emissions as a leader in the fight against climate change. Now, scientists, advocates and officials around the world are becoming increasingly concerned about the tangible effects it will have on the rest of the globe.

In addition to pulling out of Paris, which will not take effect until 2020, Trump has reneged on $2 billion in unpaid commitments to the Green Climate Fund (GCF), which was created in advance of the Paris Agreement to support projects to address climate change in the developing world. Climate finance experts fear it could be a sign of further cuts to other programs that depend on American resources.

“There’s a whole slew of things where the U.S. has become such an important supporter of other countries,” says Rachel Kyte, CEO of United Nations-backed initiative Sustainable Energy for All and former World Bank climate envoy. “Certainly there will be cuts. Exactly where the cuts call will be is something we don’t know.”

Two billion dollars may sound small in the scheme of international development, but climate finance experts say such a commitment goes further than meets the eye. Much of the money would have been used to help build basic infrastructure necessary to develop clean energy sources. Other funding would have supported the development of markets to catalyze private investment. And, because many of the GCF investments pay returns, money given to the fund would help pay for more than one project. In total, developed countries committed to send $100 billion annually in financing to the developing world by 2020. The end of U.S. financial support—and the private investment it sparks—could threaten that goal.

Read More: It Didn’t Take Long for China to Fill America’s Shoes on Climate Change

Trump has determined that such efforts amounted to a waste of American resources. “The Green Fund would likely obligate the United States to commit potentially tens of billions of dollars,” the President said in his remarks announcing the withdrawal from the Paris Agreement. “And nobody even knows where the money is going to. Nobody has been able to say, where is it going to?”

GCF’s website lists funded projects—from an effort to facilitate renewable energy in Egypt to retrofitting buildings to improve energy efficiency in Armenia—and projections of how significant their impact will be on greenhouse gas emissions reductions. The fund projects that currently financed projects are expected to reduce carbon dioxide emissions by nearly one billion metric tons. The U.S. emitted around 6.6 billion metric tons in 2015.


For many countries, losing funding means the difference between an aggressive and a limited effort to reduce greenhouse gas emissions. Nearly 190 countries representing more than 90% of global greenhouse gas emissions submitted plans to address climate change in advance of Paris Agreement negotiations. Developing countries by and large offered two commitments, one of which was contingent on financing.

Read More: Why the Paris Climate Summit Is All About the Money

Chile, for example, said it would reduce its greenhouse gas emissions 30% by 2030 unconditionally. With outside support and financing, the country said it would reduce emissions by as much as 45%. “In order for some developing countries to permit them to attain their goals you need some financing,” says Chile’s Foreign Minister Heraldo Muñoz. “That is a weak point, particularly because the U.S. probably won’t put any money into the Green Fund.”

More importantly, Muñoz says Chile needs technical support to push the transition. It remains unclear to what extent the U.S. will support such capacity building efforts, in Chile and around the globe.

U.S. withdrawal has not led other countries to pull back on their GCF commitments—at least not yet. “We’re on track as long as everybody sticks to the commitments that they made,” says Leonardo Martinez, global director of the sustainable finance center at the World Resources Institute. “We still don’t know what percentage of those commitments is going to be in jeopardy.”

SPONSORED FINANCIAL CONTENT

You May Like

EDIT POST