Published: 19 September 2018
Created as a financial mechanism of the United Nations Framework Convention on Climate Change, the Green Climate Fund (GCF) is a global fund to address the critical climate change mitigation and adaptation needs of developing nations who are being disproportionately affected by he repercussions of the climate change. The establishment of the fund was intended to promote a paradigm shift to low-emission and climate-resilient development. Advanced economies, most of whom also fall in the most carbon-producing cohort, have formally agreed to jointly mobilize USD 100 billion per year by 2020 from a variety of sources at the Copenhagen climate change negotiations in 2009, while confirming that a major share of the funds would be channeled through the GCF.
However, uncertainty looms as the GCF has only been able to raise a mere $10.3 billion equivalent in pledges as of May 2018 and is now in a precarious position as it is running out of money fast. On the one hand, the U.S. is most unlikely to pay the remaining $2 billion out of its committed $3 billion. The fund has, on the other hand, lost another $1 billion due to the devaluation of the euro and the British pound. These two factors alone account for a total loss of roughly $3 billion out of the $10.3 billion that the fund has reportedly garnered so far.
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