The politics of climate finance coordination
As COP26 approaches, governments are facing calls to increase the ambition of their climate commitments under the Paris Agreement. The mobilization of climate finance will be key to meeting these goals, prompting the need for renewed attention on how to enhance the coordination of existing funds and thus increase their effectiveness, efficiency and equity. The climate finance landscape is fragmented due to the variety of actors involved at different levels. Coordination difficulties emerge in multiple arenas and reflect the diversity of funding sources, implementation channels, and sectors relevant for climate action (Lundsgaarde, Dupuy and Persson, 2018). The Organisation for Economic Cooperation and Development has identified over 90 climate-specific funds. Most of them are multilateral. While bilateral climate finance remains significant, growth in multilateral funding has been the main driver of recent funding increases and remains a focus of international negotiations. Practitioners often highlight organizational resource constraints – such as staffing levels, the continuity of personnel, or the availability of adequate information management systems – as factors limiting coordination. In this brief, we argue that improving climate finance coordination requires considering coordination challenges in a political context where both fund secretariats and external stakeholders play an important role in shaping collaboration prospects. To illustrate this point, we highlight the political nature of global-level coordination challenges between the multilateral Climate Investment Funds (CIF) and Green Climate Fund (GCF), as well as national-level challenges in Kenya and Zambia. Key challenges influencing coordination relate to the governance of climate funds, domestic bureaucratic politics in recipient countries, and the existence of multiple coordination frameworks at the country level.