The effectiveness of the GEF : a case study of the financial mechanism for the United Nations Framework Convention on climate change

In 1991, the Global Environment Facility (GEF) was established as a multilateral fund, recognizing a need for international resource transfer for environmental activities in developing countries. After UNCED in 1992, the GEF was restructured in order to become an independent organization serving as the financial mechanism for developing country implementation of several environmental Conventions. The purpose of this study was to evaluate and explain the effectiveness of the GEF for the UNs Framework Convention on Climate Change (FCCC). The theoretical approach of this study was based on theories of International Environmental Regime Effectiveness, and I attempted to assess the extent to which the GEF has played an enabling role for the developing countries not yet disposing the necessary and relevant capacity for Convention implementation. The main findings of this study, was that the effectiveness of the GEF varied both according to the different tasks assigned by the Convention and across the group of developing countries. The GEF performed generally well in terms of developing strategies and programs to devise ways in which financial and technology transfers can be made in line with the Convention obligations and objectives. This study also found the GEF’s project portfolio to reflect a funding strategy recognizing the different needs of the different developing countries in the regime. In terms of the outcome of GEF-financed projects, GEF’s performance appears to be mixed. The GEF was given a high score in terms of enabling developing countries to meet their obligations under the Convention. GEF’s efforts to raise awareness and understanding of the problem, and to facilitate policy development appear, however, to have generated varied results. The GEF was found to be more effective in facilitating capacity building in a few developing countries considered to be extremely important due their high levels of greenhouse gas-emissions, but achieved considerably less in other countries. The general pattern flowing from GEF-supported activities was, nevertheless, that project outcomes are slow in emerging, and that the acquisition of technological know-how appears to be more difficult than expected. Two independent variables contributed to explain effectiveness, problem-solving capacity and problem characteristics. Regarding the former, problem-solving capacity was found to vary depending on the different rules of access and decision-making procedures practiced by the different forums of the GEF. In terms of explaining the above findings regarding project outcomes, one factor in particular was found to be important, GEF’s capacity to function as a channel for information. While a few countries have acquired considerable knowledge of GEF’s programs and policies for technology transfer, the majority of developing countries appear to have little understanding of neither the GEF nor its programs and procedures. A consequence of these countries lack of knowledge is that the GEF’s project cycle has become extremely long and complicated, sometimes resulting in projects outcomes that are not necessarily in line with the objectives of the Conventions. Both power and instrumental leadership loomed large within the setting of the GEF. While the most powerful actor, the US was found to be somewhat of a laggard, the GEF CEO proved to be instrumental in the decision-making processes in the GEF forums. The degree to which these actors affected GEF’s problem-solving capacity was difficult to assess, as they worked in opposite direction of each other. This study nevertheless found that many of the limitations faced by GEF’s problem-solving capacity could be traced back to the characteristics of the problem. Problem characteristics were mainly used to shed some additional light on the challenges faced by the GEF and in so doing, became an increasingly important explanatory factor of the GEF’s mixed performance. The problem of climate change was found to be extremely malign due the asymmetrical distribution of past, current and future greenhouse gas-emissions between the developed and developing countries. The developing countries did not display much interest in undertaking climate change activities unless they were related to development issues. The financial resources made available through the GEF appear not to have been sufficient in terms of creating a financial incentive in that regard. The developing countries lack of interest can, nevertheless, also be traced back to the institutional arrangements governing the resource transfer. The GEF is based on existing institutions, and its connection with the World Bank appear to have given the GEF a credibility problem at country level and has discouraged developing country participation in the climate-regime. Based on these findings, this study found that the GEF did not manage to attract sufficient developing country interest; instead it was seen as just one of many donors in the field functioning within a very complex system. Under such conditions, this study concluded that the likelihood that an effective regime would emerge was small