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International Public Finance to Address Climate Change in Indonesia – Lessons for the Future of European Development Cooperation

Briefing/policy papers

Written by Leo Peskett

International finance for climate change has become an important barometer for how rich countries with high historical emissions will help developing countries shift away from carbon-intensive development to lower carbon development pathways. The 2010 Cancun Agreements state that developed countries should provide new and additional resources for developing countries approaching $30 billion for the period 2010 to 2012 and that longer-term funding should come from both public and private sources to mobilise $100 billion per year by 2020. Much of this conversation has stayed at the level of demanding transparency in pledges and commitments from contributor countries to address climate change in developing countries, and ensuring that governments adhere to the United Nations Framework Convention on Climate Change (UNFCCC) principle of  responsibility and capabilityto pay.

But what is often missing from the international debate is evidence of what is happening on the ground as international pledges are increased. Is finance actually reaching climate change mitigation and adaptation activities? How is it being delivered? Are lessons from the aid effectiveness debate being considered? And what can we learn for the future? These are important questions for European donors, especially given European fast start funding (FSF) pledges at Cancun and a new Green paper on the future of budget support that covers quality, value for money and impact of budget support. This brief presents four insights on climate change mitigation finance in Indonesia.

Leo Peskett, Jessica Brown