Climate change fund to pay Guyana for good eco-management

The Guyana climate change investment fund seeded by Norway was established on the weekend, with the first payment equivalent to US$30 million now being processed, the World Bank said.

Through the Guyana REDD+ Investment Fund (GRIF), Norway will pay for Guyana's performance on limiting greenhouse-gas emissions from deforestation and forest degradation, and for progress made against governance-related indicators, the World Bank said, adding that Guyana will invest the payments in its Low Carbon Development Strategy (LCDS).

The agreement was signed in Washington Friday.

"Today represents a big step forward in our joint efforts to show that we can create a low deforestation, low carbon, climate resilient economy in Guyana," said Guyana's Finance Minister Ashni Singh.

"Our two countries are forging new ground in trying to work out how REDD+ can help to reconcile the world's need for urgent action to avert climate catastrophe with Guyana's sustainable development," he added.

The Guyana and Norway governments have asked the World Bank to act as the trustee of GRIF.

The parties will release a fact sheet on GRIF in Georgetown, Guyana this week, detailing how the fund will operate.

Norway's payments to Guyana - which the World Bank said is made in Kroners - may amount to about US$250 million over the period to 2015 according to a methodology set out by the two countries in November 2009.

"It is very important to support climate-change financing, particularly in the forestry area," said Axel van Trotsenburg, World Bank vice president for concessional finance and global partnerships.

"In this context, we are very pleased to support Norway and Guyana in their innovative results-based approach, by providing the financial platform for this important initiative."

Last November, Norway and Guyana set out a joint partnership to "work together to provide the world with a working example of how partnerships between developed and developing countries can save the world's tropical forests".

The partnership is based on the concept of "payment for ecosystem services" and aims to contribute to the creation of a global regime to assign economic value to standing forests, the World Bank said.

"Today, Guyana, the World Bank and Norway have shown the world that developed and developing countries can solve complex problems together for the good of all," said Erik Solheim, minister of the environment and international development of Norway.

"We have agreed on an innovative mechanism for conservation and sustainable use of rainforest. I believe our achievement shows that when we pull together, we can deliver in a way that is of benefit to countries like Guyana and to the wider world's efforts to combat climate change."