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Antalya Climate News Update No. 4 CLIMATE FINANCE WORK PROGRAMME MUST FOCUS ON IMPLEMENTING ARTICLE 9.1, SAY DEVELOPING COUNTRIES Antalya, Nov 11 (Meena Raman) – Developing countries stressed that the the purpose of the Climate Finance Work Programme (CFWP) is “to agree on the scope, modalities and work plan in order to move to substantive deliberations, and to take a decision on the effective implementation of Article 9.1 of the Paris Agreement (PA) and in not setting another process.” These remarks were made by the G77 and China at the first contact group on the CFWP on ‘Article 9.1 of the PA in the context of Article 9 as a whole’, that met on Nov 10 in Antalya. The Co-Chairs who are presiding over the session are Georg Borsting (Norway) and Yalchin Rafiyev (Azerbaijan). Parties were asked to outline their expectations and key elements in the draft outcome text. The G77 and China kicked off saying that the PA and the implementation of the Convention aim to enhance climate action in the context of sustainable development and efforts to eradicate poverty, and on the basis of equity and the principle of common but differentiated responsibilities and respective capabilities (CBDR-RC), in the light of different national circumstances. In this regard, it pointed out that Article 3 of the PA recognises that the global response to climate change will require support to developing countries for its effective implementation. It said further that “in a context where we see declining development assistance from developed countries,” the Group “remains concerned with the insufficiency, inaccessibility and very low availability of climate finance, at levels commensurate with developing countries needs and priorities and in accordance to the obligations of developed countries under both the Convention and the PA.” Explaining further, it said that “under the PA, developed countries are under the legal obligation to provide financial resources to assist developing countries in both mitigation and adaptation efforts under Article 9.1 in continuation of their existing obligation under the UNFCCC, including Article 4.3.” The G77 said that “enhanced financial support through Article 9.1 is vital to address the gap between current flows and the needs of developing countries, as well as to triple the outflows of the operating entities of the Financial Mechanism, and to achieve the goal of tripling adaptation finance by 2035, without creating additional burdens for developing countries. Therefore, the delivery of Article 9.1 under the CFWP is of utmost priority for the effective implementation of the PA.” It underlined the need for, and the importance of, launching the CFWP at COP31/CMA8, focusing on Article 9.1 of PA, and its linkages and complementarity with the specific provisions of the UNFCCC. It also referred to the role of Article 9.1 in meeting the commitments under other provisions of the PA. It also highlighted the importance of discussing appropriate burden-sharing arrangements among the developed countries included in Annex II of the Convention, as envisaged in Article 4.3. The G77 also called for “a party-driven process leading to the adoption of scope, modalities and work plan.” India, for the Like-minded Developing Countries (LMDC) said that the CFWP should contribute towards strengthening the provision of climate finance by developed countries, in light of the growing needs and priorities of developing countries, and goes beyond an exchange of views and facilitates substantive discussions on how the implementation of Article 9.1 can be strengthened, including addressing persistent gaps in the provision of climate finance. “In this regard, the CFWP must retain a clear focus on the obligations of developed country Parties and the means through which these obligations can be effectively operationalised,” adding that “we must first agree on the scope and modalities of the Work Programme before proceeding with its substantive implementation.” It said further that “it is important that Parties agree on how this mandate will be operationalised, including its objectives, thematic scope, format of engagements, expected outputs and the manner in which discussions will feed into the CMA (Conference of Parties to the PA) process.” It also said that the CFWP should commence once Parties have agreed on its scope and modalities through a CMA decision, ensuring that it is genuinely Party-driven, transparent and inclusive. It suggested the consideration of several elements while developing the modalities, including clear expected outcomes, with the CFWP having clearly identified deliverables, rather than being limited to discussions and exchanges of views. A possible key deliverable could be an Action Plan for the implementation of Article 9.1. It called for discussions that could include the legal character and implementation of the obligations under Article 9.1, quantitative and qualitative assessment of climate finance provided, including its sources, instruments, channels and concessionality, availability, accessibility and predictability of climate finance, and fair burden-sharing among developed countries. The LMDC also said that the Standing Committee on Finance (SCF) should play an important role in providing technical and analytical inputs to the CFWP, adding that the programme has a distinct mandate and should not be mixed with other ongoing processes. On the substantive areas requiring particular attention, it suggested the following: · “Quality of finance, where discussions should extend beyond aggregate volumes to examine the nature of finance provided, including its concessionality, grant component, instruments and channels. · Adaptation finance, where there should be focused consideration of the availability of highly concessional and grant-based finance for adaptation, enabling tripling goal of adaptation finance by 2035, particularly for the implementation of National Adaptation Plans (NAPs). · Predictability and accessibility, where the implications of Article 9.5 for the availability, accessibility and predictability of financial resources should receive due attention. · Reporting and accountability where it should consider improvements in reporting under Articles 9.5 and 9.7, enabling a more meaningful assessment of progress in the provision of climate finance and · Burden-sharing where it should address how the obligations of developed country Parties can be operationalised through fair burden-sharing arrangements among Annex II Parties.” On the specific consideration of tripling adaptation finance by 2035, the LMDC said “there is a need to establish a common understanding of the reference level, base year, scope of finance to be counted and methodologies for monitoring and reporting progress. The treatment of public and private finance, finance provided and mobilised, multilateral outflows and grant-equivalent accounting would require careful consideration, and the SCF could provide technical inputs, including quantitative assessments of the implications of different methodological options.” Kenya for the African Group expressed appreciation for the establishment of the CFWP in the context where overseas development assistance (ODA) is declining, and there has been a rescinding of contributions to climate funds particularly the Green Climate Fund (GCF), and the lowest replenishment in 16 years to the Global Environment Facility (GEF), with persistent gaps in finance commitments by developed countries. It stressed that there must be a course correction, principally on the obligations of developed countries, including on the burden-sharing arrangements. It wanted the launch of the CFWP and for the scope and modalities to be decided and finalised in Antalya, and to inform work until 2028, adding that it was not to renegotiate the NCQG but the focus has to be on Article 9.1. It said Africa needs adequate and predictable grant-based finance, including a tripling of adaptation finance. Saudi Arabia for the Arab Group said that the CFWP is yet to start, and it was “not in a position to consider the work done (at the June session of the Subsidiary Bodies) since there was no formal mandate to trigger such work”. (The Arab Group was referring to the workplan and workshop convened by the CFWP Co-Chairs in June this year, who are Yolando Velasco [the Philippines] and Apollonia Miola [EU]. The work plan comprises mainly of engagement workshops over two-years, which developing countries strongly disagreed with. See TWN Update from Bonn for further details). It added further that the CFWP must be the channel in which means of implementation is founded, commensurate to the level of ambition expected of developed countries. It recalled that COP30 agreed to a two-year mandate, adding that the natural sequence therefore was for the scope and modalities to trigger the launch of the CFWP. Its objective should be to enhance ambition on finance to strengthen and implement its delivery, with burden-sharing among developed countries including on budgetary reforms so that there is no rescinding from pledges as seen in the GCF. It should not be a “talk-shop” but “would require outputs and substantive outcomes and actions that guide us all the way to 2035 where the NCQG will be negotiated again”. It said there could be the creation of an ‘Action Plan’ covering COP31-33, with the scaling up of resources by developed countries in line with their obligations; informed by SCF as one of many inputs, and a ratcheting up of ambition through this Action Plan. Honduras for the Independent Alliance of Latin America and the Caribbean (AILAC) also expressed concerns over ODA and climate finance going in the wrong direction. It also pointed to the decline in the GEF replenishments and was worried about the GCF replenishment. It also stressed that the CFWP must focus on the operationalization of Article 9.1, with the expectation that it will lead to significant resources for the implementation of the NDCs and NAPs of developing countries, particularly grant-based and highly concessional with predictable, equitable and need based climate finance for climate action. This should also ensure balance and avoid overconcentration of resources to regions and address concrete barriers for financial flows from developed to developing countries. It also hoped for the CFWP launch at this session in a party-driven manner, leading to an outcome on the scope and modalities, as well as a work plan. It stressed the need for the operationalization of developed country obligations, and accountability of public finance, intended pathways, balanced allocation, burden-sharing, role of Article 9.1 in the replenishment of the operating entities of the Financial Mechanism and the Adaptation Fund, including the tripling of outflows from the operating entities. Maldives for the Alliance of Small Island States (AOSIS) reiterated that the provision of finance under the Convention and the PA is grounded on the principles of equity and CBDR-RC. Apart from the provisions of the Convention and the PA, it also drew attention to the Advisory Opinion of the International Court of Justice on the legal obligations of developed countries including on international cooperation and climate finance. It also added that for Small Island Developing States (SIDS), the fiscal space is constrained with persistent barriers to access climate finance and that the CFWP must have the practical purpose to help overcome persistent shortcomings and course correct. It also stressed on the need for a space to discuss and ensure predictability in the scale and provision of finance for SIDs and Least Developed Countries (LDCs) and for the prioritisation of grant-based financing. Brazil said that the CFWP provides an opportunity to go beyond entrenched positions and discuss substantively on the delivery of finance consistent with the principles and provisions of the Convention and the PA. It also referred to the burden-sharing arrangements among developed countries for delivery of finance, predictability of financial flows, address methodological components, scaling-up of finance, improve concessionality, without reopening the NCQG decision but towards scaling-up from the USD 300 billion to USD 1.3 trillion as part of the wider effort, adding that the tripling of adaptation finance must have a baseline. The European Union (EU) said that “this space is for constructive engagement” within the scope and mandate agreed to in Belem. It said building on the work undertaken in the first year, the scope of the CFWP is broad and we should not reopen or renegotiate what was agreed to in Belem, which is also in the context of the NCQG. It added that “there is a lot of common ground to build from”, based on the three-years of work done in the technical dialogues under the NCQG which led to the goal in Baku. The EU wanted to continue the work based on the work plan of the Co-Chairs of the CFWP. The EU said further that it was ready to discuss Article 9.1 but “these discussions cannot take place only on Article 9.1 but on Article 9 as a whole, with a view to implement the NCQG, and this requires a broad set of actors, institutions and sources as agreed in Baku.” It also said that there is the NCQG decision with guidance for years to come. On the issue of access (to finance) and addressing barriers, “we feel progress has been made and we want to have discussions (on them). It also wanted discussions on the “enabling environment, including on the international financial architecture and the role of multilateral development banks.” On the tripling of adaptation finance, the EU said that this “sits in the context of NCQG”. More speakers had raised their flags to intervene but given the time limitation, these will be heard at the next session of the contact group.
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