The Global Environment Facility (GEF)

	Website: http://www.thegef.org/gef/
	Keywords: donor contributions, climate change, developing countries, environmental governance

The Global Environment Facility (GEF) unites 182 member governments with international institutions, nongovernmental organizations and the private sector in the administration of financial resources for international environmental projects.  As an independent financial organization, the Global Environment Facility provides grants to developing countries and countries with economies in transition for projects related to biodiversity, climate change, international waters, land degradation, the ozone layer and persistent organic pollutants (POPs).

Established in 1991, the GEF operates according to the Instrument for the Establishment of the Restructured Global Environment Facility[1] and is the largest international fund for the environment. So far, the GEF has allocated $8.8 billion, supplemented by more than $38.7 billions in cofinancing, for more than 2,400 environmental projects in more than 165 developing countries and countries with economies in transition. The GEF partnership includes ten international organizations: The United Nations Development Programme; the United Nations Environment Programme; the World Bank; the United Nations Food and Agriculture Organization; the United Nations Industrial Development Organization; the African Development Bank; the Asian Development Bank; the European Bank for Reconstruction and Development; the Inter-American Development Bank; and the International Fund for Agricultural Development.

The GEF also serves as a financial mechanism for the following multilateral environmental agreements: The Convention on Biological Diversity; the United Nations Framework Convention on Climate Change; the Stockholm Convention on Persistent Organic Pollutants and the United Nations Convention to Combat Desertification. In addition, although not formally linked to the Montreal Protocol on Substances that Deplete the Ozone Layer, the GEF supports projects for the implementation of the Protocol in countries with economies in transition.

Recent developments: GEF receives record contribution from donor countries

A few days before the Fourth Assembly of the Global Environment Facility[2] that took place from the 24th to 28th May 2010 in Punta del Este, Uruguay, the GEF Secretariat announced a record boost from donor countries with more than 30 nations pledging $ 4.25 billion which will directly favor the implementation of various multilateral environmental agreements including the United Nations Framework Convention on Climate Change.

The amount pledged for the next four years is the largest increase in the GEF finances. The $4.25 billion represents a 52% increase in new resources provided by donors. The Global Environment Facility will channel these new resources towards measurable results in six key environmental focal areas: climate change, biodiversity, international waters, land degradation, persistent organic pollutants, mercury and the ozone layer. Over the next four years the GEF will direct funds to:

• lower CO2 emissions;
• expand sustainable management of protected areas and critical landscapes;
• strengthen multi-state cooperation on trans-boundary water systems management;
• reduce persistent organic pollutants in land and water; reduce mercury emissions;
• expand and protect the Earth’s forest cover.

The GEF will also implement a package of policy and operational reforms to give recipient countries greater ownership in funding choices. Some of these operational reforms were already adopted in the 38th meeting of the GEF Council[3] which was held on the 29th June in Washington DC. Among the reforms approved by the Council, developing countries will be granted:

• direct access to GEF resources for recipient countries looking to meet various UN convention requirements;
• streamlined GEF project cycle and a move to a more refined and strategic programmatic investment approach;
• reformed GEF’s Country Support Program with $26 millions in funding.

In addition, the GEF Council agreed to initiate a process to determine how best to integrate new agencies, including qualified national entities into the network of the Global Environment Facility.

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The record contribution to replenish the funds of the Global Environment Facility shall be primarily interpreted as a direct consequence of an increase on public concern in relation to environmental issues. This has been a direct consequence of the effort in promoting climate change on the international agenda. As a result, governments were compelled to finance environmental projects that are capable to address environmental issues in developing countries.

One problem is to understand how long developed countries will agree to finance environmental projects in countries with economies in transition such as Brazil, Russia, India and China. The principle of the environment as presenting “common but differentiated responsibilities” has become a sensitive issue for both developed countries and some emerging countries. The new GEF replenishment indicated that developed countries felt a strong political pressure to act instead of discussing about a possible reinterpretation of this principle. However, it is not clear yet how European recession will have an impact over future GEF contributions.

A second issue is the choice of the GEF as the largest international environment fund. In the actual scenario of the international environmental governance, many environmental organizations lack financial resources. To have a centralized financial mechanism for the implementation of multilateral environmental agreements in partnership with different organizations is therefore a choice that some developed countries seemed to have endorsed with this record replenishment.

Tarcisio Reis
Programme Officer
United Nations Environment Programme

October 2010