GCF prepares to deploy cash after signing $1.5 billion agreement with Japanese government

GCF prepares to deploy cash after signing $1.5 billion agreement with Japanese government

Following the signing of $1.5 billion agreement with the Japanese government, the UN‘s Green Climate Fund (GCF) said that it now has enough cash to decide where to deploy its cash.

The fund, which is for climate aid to developing countries, said that Japanese commitment, pushed its resources beyond the threshold. Now, they can kick off projects before a key climate summit in Paris.

UN officials had set a deadline for the end of April. However, they lacked signed agreements for funding from major donors including the US and Japan.

However, the fund now has signed agreements for $5.47 billion out of the $10.2 billion that countries have said they will contribute.

Green fund officials will now start financing projects in developing countries. They aim to help developing countries limit their greenhouse gas emissions and adapt to climate change.

Héla Cheikhrouhou, executive director of GCF said, “This achievement means the Fund has reached an important milestone and can now start making financial commitments to developing countries”.

French President Francois Hollande said earlier this week that developing nations were unlikely to sign up or a new global climate change deal, which was due to be agreed in Paris at the end of the year until they receive more financial commitments from wealthy governments.

So far 33 governments, including eight developing countries, have pledged nearly $10.2 billion to the GCF. Of those, 21 have signed contribution agreements.

The fund requires additional funds from donors and aims to become the main international vehicle for climate finance.

On Thursday, Cheikhrouhou said that governments that have not yet pledged to the Fund are encouraged to step forward.

The GCF is looking forward to present its first set of projects for approval by its board at a meeting in November. However, money is unlikely to start flowing for activities until next year.