Climate Finance Readiness Programme

Project description

Title: Climate Finance Readiness Programme (CF Ready)
Commissioned by: German Federal Ministry for Economic Cooperation and Development (BMZ)
Country: Global
Overall term: 2012 to 2018

Context

Extreme events, such as storms in Bangladesh, drought in southern Africa and water scarcity in Peru, are becoming more and more frequent as a result of climate change. In response, industrialised and developing countries alike are taking action to curb emissions and reduce their vulnerability to the impacts of climate change. An increasing amount of international funding is available for these measures. In future, a significant proportion of the funding for climate activities is expected to be channelled through the Green Climate Fund (GCF). However, further investment and effective steering mechanisms for the investment flows will be needed, in order to ensure the success of the global transition towards low-carbon and climate-resilient economies.

Objective

In selected developing countries and emerging economies, and at the global level, conditions for the effective, transformative and efficient use of funds from international climate finance, particularly from the Green Climate Fund, have improved.

Approach

On behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ), the Climate Finance Readiness Programme – otherwise known as ‘CF Ready’ – supports the efforts of partner countries to access international funds and making effective use of climate finance. The programme does not provide countries with direct funding. Instead, it supports them in planning for and accessing financial resources from the GCF and other climate funds, and in carrying out related measures. The programme is implemented jointly by KfW Entwicklungsbank and GIZ. Since 2014, GIZ has also received financial support for the programme from USAID and the Ministry for Environment of the Czech Republic. In addition, CF Ready is a GCF delivery partner for readiness and preparatory support.

To achieve its objective, the CF Ready programme works in close consultation with donors to implement packages of measures in more than 14 countries and one region. GIZ provides support to national and regional climate finance institutions in these places.

The programme advises its partners on establishing the necessary institutions, such as National Designated Authorities for the GCF. It also provides assistance for the process of selecting and setting up national institutions to gain GCF accreditation in order to access the funds. By strengthening these institutions the programme enables them to support and carry out effective climate programmes and help achieve the national development goals.

The programme also delivers strategic advisory services in various areas, including National Adaptation Plans, national readiness roadmaps, climate finance strategies, Intended Nationally Determined Contributions, and GCF Country Programmes. It assists in the further development of these strategies so they can be used as the basis for decisions on funding. It also provides advice on integrating climate strategies into national and sectoral development plans.

Activities in the areas of knowledge management, capacity development and policy advice also form part of the programme. It develops concepts and methods, assesses experiences gained so far, and organises forums for ongoing discussions on replicable best practices in the field of climate finance readiness.

The activities of CF Ready and KfW complement each other. The Bank is active in some of the same countries as the programme, providing assistance for the preparation of GCF project proposals and for the accreditation of national development banks.

Results

Since its inception the CF Ready programme has implemented a variety of support activities in its partner countries:

  • Support for National Designated Authorities: the programme has successfully supported the designation process in six countries. In seven countries and one region it is assisting the designated authorities in becoming functional, in particular providing training on the processes and latest developments of the GCF, and supporting them in setting up so-called no-objection procedures and coordination mechanisms. In five countries, assessment reports on potential accredited entities have been used by the Nationally Designated Authorities as a basis for their recommendations of a national institution for accreditation with the GCF.
  • Support for National Implementing Entities for the GCF, as well as implementing entities for other climate funds: in nine countries, including regular partner countries and one additional country, the programme has provided support, or is still providing support, for example, during the accreditation process for direct access to the GCF. This includes the development and provision of training on the environmental and social safeguards which must be in place for successful accreditation. Diirect access by a national institution has been established in four of the nine countries.
  • Support on strategic and conceptual issues: until now, CF Ready has supported nine countries in adjusting their climate change and development strategies, ensuring they pay greater attention to the requirements of international climate finance and the GCF, and that they mainstream climate in national or sectoral development strategies. In six countries the support is embedded in the development of their national adaptation plans, in particular the relevant component on financing. In three further countries the support focuses on integrating climate financing aspects into national strategies, plans and public finance instruments.

In addition, CF Ready has implemented or supported a number of strategic activities, tools and documents at the global level, which are being used or implemented by numerous countries. Examples include:

  • Development of a self-assessment tool for Green Climate Fund accreditation
  • Delivery of GIZ’s interactive climate finance readiness training programme (CliFiT)
  • Provision of training in environmental and social safeguards, together with the World Resources Institute and in close cooperation with the GCF Secretariat.
  • Completion of the study ‘Shifting Paradigms – Unpacking Transformation for Climate Action’ and a set of guidelines on transformative change in international climate finance: ‘Navigating a New Agenda – Questions and answers on Paradigm Shifts and Transformational Change’.