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The 6th GEF Assembly - Orientations for global environmental protection in the next four years



Dr. Đỗ Nam Thắng

     Taking place for a week with a series of meetings and related events, the 6th Global Environment Facility (GEF) Assembly ended successfully on 29th June 2018. This is the most important global environment event hosted by Việt Nam with about 1,500 high level participants from nearly 180 GEF member countries and major international organizations. In this Assembly and related meetings, various global environmental issues as well as their solutions were discussed via the approved strategy and program for GEF 7, implementation policies and several main inter-sectoral topics.
     The GEF 7 replenishment negotiating process lasts for more than one year via four replenishment meetings. This is the most complex replenishment since the GEF establishment in 1992 for several reasons. Firstly, GEF donor countries have revealed more stringent requirements on effectiveness of GEF resources. Apart from requirements for higher quality projects, the donor countries have asked for a higher co-financing ratio as well as increased participation of public sector. Secondly, the US, one of the major GEF donors in the previous cycles has recently reduced its budget for environmental activities in general and for GEF in particular. This has a significant influence on GEF replenishments as well as on other donors’ commitments. Thirdly, the number of GEF agencies increased from 12 in 2013 to 18 in 2018. Differences in policies and focuses of these agencies created diversion in view points in the GEF 7 replenishment meetings. In addition, recipient countries have become more vocal in requesting for countries’ ownerships and participation in resource allocation.
     The stakeholders’ differences have created considerable pressure in reaching agreements.  However, after three meeting days from 24-26/6/2018, the GEF Council approved the strategy and program for GEF 7. The most important contents then were endorsed in the 6th GEF Assembly on 27-28/6/2018. According to these documents, in the next four years, the overall budget for GEF is 4.1 billion USD, which will be allocated for projects and administrative management. Budgets for the three main focal areas of biodiversity, climate change and land degradation are 1292, 802 and 475 million USD, respectively (Figure). Of these, the countries will directly receive via the System of Transparent Allocation of Resources (STAR) 1031 million USD for biodiversity, 511 million for climate change and 354 million for land degradation. The remaining will be allocated via set aside global and regional projects. Among the three focal areas, climate change is subject to budget reduction the most, about 40% compared with Cycle 6, due to the establishment and operation of the Green Climate Fund (GCF), a separate financial mechanism for climate change.

     Việt Nam will receive 18.1 million USD in Cycle 7 via STAR, about 30% reduction compared with Cycle 6. The main reason for this reduction is that the overall budget for GEF 7 is 4.1 billion USD while that of GEF 6 is 4.43 billion USD. In addition, an important weighting scale of GDP of Việt Nam increased from 1,870 USD per capita in 2013 to 2,343 USD in 2017. Of the STAR allocation, 13 million USD is for biodiversity, 3.62 million for climate change and 1.39 million for land degradation.
      The countries have a certain flexibility in using STAR budgets. Sixty-one countries with their STAR budgets of lower than 7 million USD have a full flexibility in changing the allocation among the three focal areas of biodiversity, climate change and land degradation. For those with STAR budgets of over 7 million USD, the countries can have a flexibility of 2 million USD or 13% of their STAR, whichever is higher. Việt Nam is among these countries, with a flexibility limit of 2.34 million USD.

     STAR allocation will focus on: mainstreaming biodiversity across sectors as well as landscapes and seascapes, addressing direct drivers to protect habitats and species, furthering development of policy and institutional frameworks, promoting innovation and technology transfer for sustainable energy breakthroughs, demonstrating mitigation options with systematic impacts, fostering enabling conditions for mainstreaming mitigation into sustainable development strategies, supporting ground implementation of sustainable land management and fostering enabling conditions for sustainable land management.

     Apart from STAR, GEF 7 continues to support other focal areas of chemical and wastes, international waters and sustainable forest management via non-STAR allocation. The non-STAR allocation will follow a principle of “first come, first served”. The non-STAR will support the projects of strengthening blue economy opportunities, improving the management of areas beyond national jurisdictions, enhancing water security in freshwater ecosystems, industrial chemical programs, agriculture chemical programs, least developing countries and small island countries and enabling programs. Besides, GEF 7 also has three impact programs of food, land use and restoration, sustainable cities and sustainable forest management. The participation in these impact programs will be based on the countries’ interests and potential contributions to addressing the global environmental issues.
     The GEF Assembly also approved some implementation for GEF 7, including a co-financing rate, strengthened partnership in GEF project implementation and fostered gender issues.
The GEF Assembly approved increasing the co-financing rate from 5:1 to 7:1 in Cycle 7, meaning that 1 USD of GEF will leverage 7 USD from other sources, including governments, implementing agencies, the private sector and the community. However, this is a target of all projects, not for any individual project. In addition, co-financing is broadly defined, including all resources for implementing GEF projects.
     Regarding the strengthened partnership in implementing GEF projects, the Assembly approved the removal of requirements for a ceiling of 20% of GEF projects out of the total budgets of the GEF project agencies. According to this policy, there are no differences in the traditional GEF agencies such as multilateral development banks and UN agencies, and the new eight GEF project agencies such as IUCN and WWF. Thanks to this, the new GEF project agencies can have more access to GEF projects.
     The Assembly also approved some policies related to strengthening gender issues in GEF projects, more consultation with civil society organizations and increased participation of private sector. However, these are in principles only. More documents will need to follow to specify these policies.
     It can be concluded that the 6th GEF Assembly has opened important orientations for global environmental protection activities in the next four years. Although there is a little change in focal areas, ways of developing and processing proposals need to be improved to increase access to and better use of resources of this largest environmental financing mechanism.

      Some major interdisciplinary topics of the Assembly 

      During the two days of the Assembly, 12 round tables have been organized with the following topics:
    * Food, land use and restoration: Discussions focused on interlinkages among food security, land use, biodiversity conservation, and partnerships in sustainable land management and land degradation prevention. Examples and issues were mainly about Latin America and Africa.
    * Sustainable cities: Discussions were about solutions for sustainable urban planning, land use planning, emission and waste treatment, climate change adaptation and sustainable cities financing mechanisms. The GEF Global Platform for Sustainable Cities starting in GEF 6 will continue in GEF 7.
   * Partnerships in implementing Agenda 2030: This is a broad topic involving the areas of policies, regulations, financial mechanisms, partnerships and technologies. Discussions agreed that more resources were needed for achieving Agenda 2030 objectives. 
     * Science based targets for the Earth: This roundtable raised the need for developing science based targets for sustainability of the earth. Suggestions for the establishment of an intergovernmental panel for each environmental areas and relevant targets, similar to IPCC and the targets of 2oC increase for climate change.
     * Circular economy: This is an interesting topic for the private sector. A circular economy will not only address waste issues, achieve sustainable development goals and Paris Agreement but also create profit opportunities from reusing and recycling wastes. International corporation representatives expressed interests in working with the GEF and governments to promote this concept.

     * Marine plastic wastes: This is one of the most live discussions of the Assembly. Government representatives from Norway, Việt Nam, Indonesia and the CEO of Unilever, WB Vice President and UNEP Executive Director presented initiatives on mobilizing resources for marine plastic waste control, raising awareness and promoting participation of producers and consumers, and technology innovation in design and materials. In particular, Việt Nam’s initiative on a regional marine plastic control project was highly regarded.

     * Transforming chemical industry: Participants highlighted the importance of maintaining and promoting chemical pollution control, from production to consumption, and the need for having separate projects in this topic.

     * Wildlife: Discussions focused on solutions for combating against illegal wildlife trade, transboundary impact of bans on illegal wildlife and linkages of local people’s livelihood and conservation, in particular local people’s benefits in eco-tourism.

     * Genders and environment: Women’s roles in addressing environmental issues were reaffirmed. Specific recommendations on increasing women’s participation in all stages of the GEF projects were also made.
   * Clean energy innovation: To address an issue that 1.2 billion people lack access to energy and 2.8 billion people suffer from indoor air pollution requires various solutions related to technology innovation and sustainable financial mechanisms, including green bonds.
  *  Conservation financing: The biggest challenge of conservation in a lack of investors’ incentives due to low profits and long pay-back periods. Therefore, it is necessary to create incentive mechanisms for private sector participation, conservation markets to support governments in investing in conservation, including seascapes.

   * Sustainable dry lands: Experiences mainly from Africa were exchanged, with a focus on indigenous people’s roles as a key success factor. 
     Among these topics, sustainable cities, circular economy and marine plastic wastes are emerging issues which attracted considerable interests. GEF 7 will have some projects addressing these issues

Overview of the opening ceremony of the 6th GEF Assembly

GEF Chair and CEO Naoko Ishii congratulates Vietnam Minister of Natural Resources and Environment Trần Hồng Hà at the closing ceremony

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