Abstract:

As the largest operating entity of the financial mechanism of the United Nations Framework Convention on Climate Change and the Paris Agreement, the Green Climate Fund (GCF) is not only an important channel for developed countries to fulfill their long-term financial commitment of $100 billion, but also a key factor in achieving the objectives of the Convention and the Paris Agreement. This paper summarizes the positive role of the GCF in advancing the international cooperation on climate change, providing financial support for developing countries to tackle climate change, and promoting private sector participation in climate change action. Against the backdrop of challenges in the multilateral cooperation, the GCF is also confronted with many immediate and potential difficulties such as uncertainty of financial resources, lack of effective decision-making mechanisms, need for improvement of project quality and the capacity of the Secretariat. This paper presents that an effective GCF is vital for the implementation of Paris Agreement. To ensure the sustainable development of the GCF, the paper suggests that all parties should build political consensus and take the following actions. First, improve the governance efficiency by introducing voting mechanism in the absence of consensus, filling policy gaps and innovating business model. Secondly, ensure adequate and sustainable financial resources by finalizing formal replenishment process as soon as possible, receiving contributions from alternative sources, managing remaining commitment authority; and finally, enhance the coordination and complementarity with existing climate funds and multilateral development banks to make financial flows consistent with a pathway towards low carbon and climate resilient development. This papers also proposes that China should facilitate the GCF reform process by bridging the differences between developed and developing countries, and at the same time ensure the board membership for the next three years to promote the holistic cooperation with GCF and make contributions in the GCF formal replenishment process to serve the ecological civilization and the global climate action.

Key words: The Paris Agreement, Global climate governance, Green Climate Fund (GCF), Climate finance