“The United Nations’ Green Climate Fund (GCF) has had a record year in terms of approving projects in countries vulnerable to climate change, thanks in part to reforms that have reduced bureaucratic hurdles,” said its Executive Director, Mafalda Duarte, in an interview with AFP.
GCF, founded in 2015 and based in Songdo (South Korea), is the world’s largest multilateral climate fund. Since its creation, it has raised $19.3 billion and aims to reach $50 billion by 2030.
The Fund was established to channel money from wealthy countries—historically the most responsible for climate change—to developing countries, to help them adapt to global warming and reduce emissions.
Record year
This year, the GCF announced a record $3.26 billion in new pledges, a substantial increase compared to its second-best year, 2021, when it raised $2.9 billion. That total includes $295 million for a desalination and water transport project in Jordan, described as “vital” by the Middle Eastern nation, which faces a severe water crisis. This is the largest single project ever financed by the Fund.
“A positive signal in today’s geopolitical climate,” Mafalda Duarte told AFP in an interview conducted ahead of COP30, which will take place in mid-November in Brazil. The context includes challenges, such as the US withdrawal from the Paris Climate Agreement and the situation in Europe, where some governments have cut foreign aid due to domestic economic pressures.
Administrative reforms
Duarte attributes this record-breaking year to the administrative reforms she has implemented since taking over the GCF in 2023. An example of these reforms: project review times have been cut from two years to nine months, and the accreditation process for partner institutions, such as national agencies and banks, has been shortened from three years to nine months.
Mafalda Duarte also defends the use of loans rather than grants for profit-generating projects. She argues that low-interest loans make better use of donor funds while still benefiting developing countries.
Loans and grants
Developing countries and non-profit organizations have long criticized loans, saying they increase debt burdens and force low-income nations to repay more than they can afford. But according to Duarte, grants are appropriate for the most vulnerable countries, yet not always justified when private-sector partners stand to profit.
Currently, about 45% of the Fund’s financing takes the form of grants. However, Duarte stresses that grants alone cannot meet the Paris Agreement goal of limiting global warming to 1.5°C above preindustrial levels.
‘Accountability’
For her, COP30 will be successful only if it focuses on ‘accountability’. “Otherwise,” she says, “Future generations will look back at us and ask: how could you have been so slow to understand?”
Belgium is also involved in the Green Climate Fund. The country signed a contribution agreement for the GCF’s first replenishment period (in December 2019) and its second (in May 2024). Belgium has pledged a contribution of €150 million for the period 2024-2027, up from its earlier pledge of €100 million.
