The Pacific Resilience Facility treaty is set to be signed and ratified on Wednesday at the Pacific Islands Leaders Summit in Honiara. Photo: Supplied: Hall Contracting
After years of frustration trying to access climate finance, Pacific leaders are creating their own climate fund.
The Pacific Resilience Facility (PRF) treaty is set to be signed and ratified on Wednesday at the Pacific Islands Forum Leaders Meeting in Honiara, after a decade in the making. It will become the Forum's first financial institution.
The fund is going to be Pacific-led and is dedicated to improving community resilience in the region.
PRF general manager Finau Soqo said the idea was sparked by the difficulty of accessing the Green Climate Fund (GCF) - the world's largest climate fund for helping developing countries adapt and limit greenhouse emissions.
"For some of our countries, we've had to wait for years to access it. So the response to that was, 'Okay, instead of a club of 100 countries or 60 countries, maybe let's have just ours, just for the Pacific', and that's the essence of it."
So far, US$162 million has been pledged, with the goal of reaching $500m by the end of 2026.
"What the PRF treaty signing on Wednesday will do is trigger a series of processes, including a call on those pledges [and] an invitation for other sovereign investors to then formally pledge to fundraise for the rest," Soqo said.
"Our investors are dipping their toes in the water, like they're testing, so they're coming in with single-digit contributions. But of course, what we really want to do is fundraise the whole $500m before we start granting to communities so that the fund can be sustainable."
PRF general manager Finau Soqo Photo: RNZ Pacific/Caleb Fotheringham
The money from investor countries will generate a return - similar to a superannuation fund - with the return being used to finance community projects.
"Out of every dollar that we earn in income, 90 cents will be distributed, 10 cents will be reinvested so that we can grow the fund," Soqo said.
"It needs to be sustainable. We don't want it to just disperse everything and then it runs out of money for community projects."
Pacific Islands Forum (PIF) secretary-general Baron Waqa said Australia needed to be more attentive in the climate space when he was asked by the media how he viewed the nation's approach to global warming.
"Australia may be taking a little bit more time in addressing climate change, but I'm very positive at how things are moving."
Waqa said Australia had also pledged AU$100m to the fund, the most by any country.
"They're the top and that fund will assist climate vulnerable people, our people in the Pacific," he said.
"These are the very small voices that are somewhere in the village or in some of the small islands."
Last year, leaders endorsed Tonga as the location for the fund.
PIF chair and Tongan Prime Minister Dr 'Aisake Eke said the Pacific does not have the luxury of time when it comes to climate change.
The US pledged $20m last year in Tonga, Soqo said with the new administration there's uncertainty if that will come through.
