How Can We Make Climate Finance Fit for Purpose? A Conversation with the Green Climate Fund’s Mafalda Duarte

CLEMENCE LANDERS:
Mafalda Duarte. Welcome to the Center for Global Development.

MAFALDA DUARTE:
Thank you.

CLEMENCE LANDERS:
You are our final speaker of these annual meetings 2024, so heavy is the head that wears the crown. We've been speaking a lot and having a lot of sessions this week on the MDBs. We're two years into the evolution process, so we've been asking a lot of questions around where are the MDBs now, what's the state of the global financial architecture, where are we in terms of resourcing our efforts on climate change, and so I really couldn't think of a better way to end our annual meeting events with the Green Climate Fund, which is such an integral part of the architecture, but it's a part that we focused a little bit less on this week, so I think we're very excited to just learn a lot more about it. So, you need no introduction, but Mafalda Duarte is the Executive Director of the Green Climate Fund. Prior to joining the Green Climate Fund, you were leading the Climate Investment Funds, which grew significantly in size, scope, and reputation during your tenure. And under your leadership, the Climate Investment Funds became an early funder of initiatives around green industrial decarbonization energy storage.

You also led a lot of the initiatives in the early thinking about the Just Energy Transition Platforms, and then, prior to joining the CIF, you were at both the African Development Bank and the World Bank. So, let me just ask you to maybe just kick us off: what is the Green Climate Fund and tell us a little bit about it?

MAFALDA DUARTE:
Thank you, Clemence, and thank you for having us here. You'll notice that I will continue to sip coffee because I was just telling Clemence I arrived this morning, 5:30 in the morning, from South Korea. So, caffeine is most welcomed. So, the Green Climate Fund is- I mean, I try to not use a lot of jargon, but it's the largest multilateral climate fund globally. It is set as one of the key financial mechanisms to deliver on the Paris Agreement in terms of support to developing countries, supporting them in terms of their climate ambition, both mitigation and adaptation. So, the fund was set up ten years ago. It has grown from then until now. We've had $33 billion in pledges. Our last replenishment was last year, and we received pledges of $13 billion, which was the largest. We've had three rounds of pledges, 10, 10, and 13, and out of those $33 billion, we have at the moment $19 billion paid in, and out of the $19 billion paid in, we have commitments in projects in developing countries of 16, actually.

I came from the board; our board was just meeting for four days, and we've approved another $1 billion worth of investments. So, we normally invest roughly around half of our resources in mitigation, half in adaptation, which is important because we know that there's a very significant adaptation finance gap. So, we actually, in terms of the share of the resources that we invest, we are largest in terms of adaptation finance. And within adaptation finance, we have a clear mandate to focus on the least developed countries, SIDs and African states, which we do as well. We also provide a significant amount of grant resources, which is, again, another big ask and debate in this whole architecture, particularly when we are talking about the most vulnerable communities and resilience. So, that's where we dedicate most of our grant resources. But we do provide loans, we provide grants, we provide loans. We also use guarantees and equity instruments. So, we have quite a bit of flexibility.

We are working in 130 countries, so it's a very large and diverse portfolio of more than 260 investments. One of the very interesting things about the Green Climate Fund is the fact that we work with a very large and diversified network of organizations. So, we work from MDBs, which is a big discussion, of course, these days. But we work directly with private sector, commercial institutions, equity funds, so very different local financial institutions, national development banks. But we also work with the UN agencies, with civil society organizations, with governments directly. So, it's quite a hybrid model, very vast, large network, 135 entities that we are currently having accredited with the fund, and a very large interest of many more, in particular, developing countries have a keen interest in having their national entities, besides even the government, having their national entities accredited with the Green Climate Fund and being able to themselves obtain these resources for investments.

So, it's a rather unique instrument, given the scale, the flexibility, the large network of partners. It's rather unique in this architecture, and I'm happy to answer more questions around that. I've been in this system for a while, and I know that from an outside perspective, it's not often easy to understand the differences, but there are some interesting differences between the funds and the linkage between the funds and the MDBs.

CLEMENCE LANDERS:
Yeah, there's a lot here that I want to unpack, and in particular, I think in the second half, I want to get into these architecture questions because I think, in particular from our audience, we're going to have a lot navigating the different architecture, the different pieces and how it all comes together. But I just wanted to follow up on this point around, you said 135 different accredited entities. How do you go about selecting which projects you're going to fund? Do the entities come to you with proposals? Do you go to them and say, these are the kinds of things we want to fund, come to us with a proposal? How do you prioritize?

MAFALDA DUARTE:
Okay, so I mean, there are different models, and then we'll come to the prioritization point. We do have- because, again, it's the hybrid, so for example, we have governments that are accredited and then we have multilateral development banks that are also accredited or UN agencies. So, we can get proposals- we get proposals, in fact, from all of them. And we actually have a lot more projects that have come to us than what we can fund, and so, what we have been doing, even more so since I took over a year ago, is have very deliberate conversations with the governments, with the countries, to try to understand their priorities. What are the priorities, and how do we align those priorities with the pipeline that we are seeing coming out of so many entities that might want to work in any given country? And with that, try to, on the basis of those discussions, try to understand how do we prioritize any of this, because we have limited resources. We cannot fund everything that has come to us. We have mandates, as I said, from our board to invest half of the resources, around half in mitigation and half of adaptation, to prioritize certain geographies. We have certain mandates in terms of sectors and areas. I'll just give you an example: we have committed to invest significantly in early warning systems for all. We are part of the UN Secretary General plea to make sure that within a few years, all countries have solid early warning systems for all. So, we have those mandates, so we take that into account; we take into account what we are seeing coming out of the entities. We take into account what the countries tell us their priorities are, and then we try to make sense of all of this and say, OK, how do we prioritize and get into an agreement with the governments and certainly on the sovereign or public sector projects, country-specific, if they are country-specific? Because the other thing is that we do single-country projects, but we also do multi-country or regional projects.

So, it's quite a process.

CLEMENCE LANDERS:
And you're just coming out of a board meeting and you're still very early in your tenure, so you must have a vision for how what changes you want to make to the institution and where you want to take things. I understand you just launched a 50 by 30 agenda. Can you tell us a little bit about this and where you see the big departure points, maybe with where GCF has been in the past?

MAFALDA DUARTE:
Well, so the way I look at this, I took over slightly a year ago, and the way I look at this is one where, and it's not unique to GCF. We need scale. We need speed. I don't think any of us need to be persuaded that we are losing the window of opportunity is narrowing more and more. And we are certainly not investing at the scale and speed needed, in particular in developing countries, because it's quite worrisome to see that, actually, in recent years, the flow of investments in the developing countries in things like renewable energy are actually decreasing. If we think outside of China, we see the investments, actually the trends going down.

CLEMENCE LANDERS:
What do you think that is?

MAFALDA DUARTE:
So, I think I mean, we are in an overall macroeconomic situation that is challenging, of course. The developing countries have suffered from the recent crisis as well. There are serious debt challenges in developing countries. So, if we look at all of that macroeconomic situation and we see that, for example, with the IRA here in the US and other commitments elsewhere in developed countries, there are attractive investment opportunities for the private sector. So, I think it's not one factor. It's a combination of factors that is leading to this trend that is quite worrisome, because we need to be doing both. We need these investments in developed countries, but we certainly need them in developing countries. I think we all have to realize that two-thirds of the trillions of dollars of infrastructure investments that will happen in the in the coming decade, decade and a half, two decades is in developing countries. So, the lock in effect of high carbon, low resilient infrastructure is really, really concerning.

Coming back to the 50 by 30. My point of departure is we need scale and we need speed. So, therefore, 50 by 30, it's basically to signal we will equip the organization to operate at a much larger scale and speed. And so, I indicated a few things when I launched, and this is in strong alignment with the mandate of the fund, with the strategy that the board had agreed as well, though they didn't fix any particular target in terms of volume. Certainly, their ambition is one of increased scale for the fund. So, some of the things that I said when I launched it a year ago in the United Nations General Assembly, was targeting the most vulnerable people in communities, private sector capital mobilization, and an agenda of efficiency, focus on efficiency and impact, and really bringing partners together in more ambitious country platforms. So, those were basically the way I frame the vision. So, therefore, in terms of priorities, we are going through reforms to make the institution more streamlined and more efficient.

And I can unpack that a little bit. I have also reorganized the structure. We launched a new structure on 9 September, which I had announced earlier this year, to respond to that efficiency and impact agenda. So, for example, we are going to be structured in regions, so our model is one that's going to be fully operated. So, the operational side of the organization is going to be fully integrated in regions, and we will have a dedicated, in the normal understanding of MDBs, a whole vice presidency or equivalent dedicated for impact strategy and impact. So, those are some of the of the changes to respond to the private sector capital mobilization focus. I think we've announced quite a few interesting, innovative transactions last COP. I think during the course of this year in the board, we've also had approvals interesting, interesting transactions as well. But we are going to do a lot more on strategic investment partnerships and co-investments, so we have a dedicated team to help us push on that agenda, and that will be done through different ways, including mobilizing co-investments to our portfolio as well.

CLEMENCE LANDERS:
Yeah, let's stay on this private capital mobilization point. And this is something that we've been discussing a lot here at CGD this week and is a big theme of the annual meetings. And there is a real sense that, at best, the MDBs are right now getting an incomplete grade on private capital mobilization. In a lot of ways, it's been the white whale of development finance. But you were quite successful in this at the Climate Investment Funds. And if I understand correctly, I want to move this question a little bit towards risk appetite. The Green Climate Fund does not have a credit rating, is that right? So, you aren't necessarily tethered to the same supposed constraints that a lot of the MDBs have in terms of needing to maintain a portfolio that is not at risk. How do you see what the GCF can do in terms of private capital mobilization that maybe the rest of the system can't do? How are you thinking about this?

MAFALDA DUARTE:
There's a lot in that question. So, the first thing to say is that even organizations with credit rating, either double-A or triple-A, I mean, the MDBs, of course, that group of MDBs is triple-A, they can also do more than what they are doing, and this was recognized in the CAF and, therefore all of the asks for reform. So, all of the conversation around the credit rating agencies and their methodologies, and those need to evolve given where we are globally and the fact that climate requires a perspective that is more medium-term and long-term. So, we have a lot of these institutions that operate with short-term models and methodologies and paradigms. So that's one. These types of institutions like the Green Climate Fund or the Climate Investment Funds where I was before- what the shareholders or those that put capital in these organizations, their intent, because this is still public money, this is taxpayer money of many countries, including the US, is precisely to enable, to have available, the long-term patient risk capital that can enable investments that otherwise wouldn't happen, including by the MDBs.

So, I mean, a good example, which I was involved in my previous role was geothermal power development. It's very risky. Early stage of geothermal power development is very risky. And the MDBs were not involved in those investments to the degree that it would have been helpful for them to be precisely because it's quite risky. And depending on how much exposure they themselves would have in their own balance sheet to those investments, and if they started to grow in proportion to other investments, then that's when we could start having questions around, OK, what might be the impact of having portfolios, large portfolios of geothermal power development or other investments that are risk-they are risky- it's known that they are risky. So, that's what this public capital can do, and therefore, by doing so, either bring private sector, bring MDB or both to the investments.

And that's what GCF, the Green Climate Fund, that's what it is. It's risk-patient, long-term capital. The interesting thing with the Green Climate Fund, as opposed to what I had seen, because one of the things that we had also seen with the multilateral development banks, and I was inside these organizations, and therefore, all of the conversation around they should do more guarantees because if they use more guarantees, that more capital can be deployed. And there's a lot of conversation around guarantees as well and different perspectives around guarantees. One of the things that I see, for example, GCF doing is precisely having a lot more flexibility. So, we have some level of guarantees. It's not the instrument, it's not the most commonly used instrument, but we have some exposure in terms of that financial instrument. We have a large equity portfolio, which is actually quite interesting. And I hadn't seen the rest of this architecture or landscape, whatever we want to call it. So, we have a very large exposure, and the significant part of that is for adaptation investments. So, we are investing in several equity funds that are then providing capital to smaller companies that are investing in adaptation. It tends to be a combination also of adaptation and mitigation.

But that's interesting. So, that flexibility, and we have a high degree of flexibility- we can provide also grants, we can provide project preparation, we can help, we have a large project preparation facility within the fund that can help prepare projects to the maturity stage where then the investments can come in. So, I mean, your original question was private-sector capital mobilization- I think the whole system needs to do more. That's basically my underlying answer is- MDBs can do more despite their credit rating. There are funds that can also, I think we have a lot of flexibility in the Green Climate Fund, and we are using it. We are trying to think more deliberately- how do we do more? That's why I said, I think we have been announcing interesting things like last COP, we announced our investment in a platform, in a green guarantee company that basically guarantees issuances of green bonds. We also announced investments in a blended finance platform to unlock long-term lending or longer than what the markets are currently offering to some national governments. And these are attempts to bring also institutional capital into developing countries. So, we are doing a diversity of things through different types of structures, with different types of investors. And the commitment is to be a lot more deliberate.

CLEMENCE LANDERS:
Let's talk a little bit now about architecture and the climate finance architecture in particular. So, a couple of different ways we can take this. But I understand the G20 has commissioned a report looking at the architecture. I haven't myself seen it. Perhaps you have. And if you feel like telling us about it, we're all very curious. But you've been at two of these organizations. There are a lot of climate finance organizations. As a matter of fact, it seems like every time there's a new...

MAFALDA DUARTE:
Every time there's an event. Not even COP. Every time there's a climate event, there's something new.

CLEMENCE LANDERS:
Yes. And so I understand that the Azerbaijani presidency may be announcing something new as well. It seems like we are in a time where we have a very fragmented system, that, I would say, might even be operating as less of the sum of its parts. Can you reflect on this? What's working? What isn't? If you had a magic wand, how would you change things?

MAFALDA DUARTE:
Who has a magic wand?

CLEMENCE LANDERS:
Right now you do.

MAFALDA DUARTE:
I have said this many times, because I actually started my development career working in government. So, I was on the receiving end of all of this fragmentation, and this was many years ago. I'm not going to quote how many. At the time when I was in government and I was on the receiving end, I remember having to deal with 21 different organizations. And the costs associated in institutions that have lower capacity and have many challenges. These coordination costs are very high, and the coordination costs and the requirements are different. Every single organization has different requirements, every single standard, the way they want information, the templates, everything. And we are still to the greatest extent in that same paradigm. So, forget about creating new things because the creation of new things, this obsession or tendency or whatever the word that we might want to use to describe it- every time there's a big event climate event, we announce something new- is actually doing a disservice to the objectives and to the countries to those that actually have to use these resources.

So, I think we should stop, and I have actually said to different key stakeholders, COPs for example, should become an accountability forum. It should be about coming to the COP and reflecting back, OK, what have we committed? How much have we delivered? Let's go back to those commitments and announcements. And now let's drive accountability here. And if we are not able to advance, let's reflect why. What do we need to do? Instead of just keep creating institutions and initiatives which drain resources. So that's one. The second one is that there has to be really much more of an effort of what we might call standardization, because some of the things don't make sense. Why every organization, why for example, let's talk about MDBs why there isn't why there isn't further standardization of requirements. They are very similar organizations. The same thing with the climate funds. Why isn't there further standardization? OK. We can say, well, they all have specificities in their mandate, that's fine, they all have specificities in their mandate, they all have their governing bodies, their boards. But there is a really great degree of standardization that is possible and should really be pursued with deliberation, because, you know, it will help scaling up and speeding up these investments.

So, I started off in government, I was on the receiving end, as I said, but the private sector investors say the same thing “just standardize.” We don't want to have to deal with this set of requirements that then are different. And then you see I remember... I'm not going to quote the government. But I remember, you know, as being part of investments that brought multiple financiers together, a couple of MDBs, a couple of funds, some others, and I had one government who told me the single highest cost was the coordination of all of these different financiers and the different requirements. Because it's the same investment, but if you have organizations that have different procurement systems, for example, it's the same investment, but they have to look at different procurement rules, or they might have to look at different environmental and social standards and safeguards.

It's the same investment. So, just to come back to your question, is this a landscape fit for purpose? No. For me, the key message is we should stop with new things and actually consolidate, to the extent possible, and we should standardize.

CLEMENCE LANDERS:
I was waiting for you to say consolidation.

MAFALDA DUARTE:
No, I'm not suggesting that certain MDBs should merge.

CLEMENCE LANDERS:
You're not suggesting certain MDBs should merge. If there's press present, that is not the news that you've been waiting for. But I think the moratorium on the creation of new organizations resonates. The standardization point resonates. I think in the magic wand might be more consolidation of some of the funds. I mean, is that a politically possible thing to do at this point, or is that something that is not even worth reflecting on, because politically it's not doable?

MAFALDA DUARTE:
I mean, so you were talking about the G-20 report. The G-20 report right now talks about four funds. These are the largest, multilateral funds because there's a lot of bilateral funds as well. So, it's important to understand this. I've also said that do I see that there's scope, even within the conversation of four to think carefully around how do we maximize this system? Yes. But do I think that the fragmentation comes mostly from four? No, fragmentation comes from all of the thousands, hundreds of flowers blooming elsewhere. And we know this, the number of initiatives and trust funds and everything that is out there is very significant. But again, do I think that, and we are having these conversations and the G20 report alludes to this as well. Are there conversations that can happen to, to see how do we maximize? Because the funds, even these four were established at different points in time with specific, it's almost like the Bretton Woods. The Bretton Woods organizations were set up in a specific historical context for a specific mission.

And now we face different challenges. So that's why there's this pressure now. OK. How do we evolve these organizations to be responsive to the challenges that we face right now? So, it's the same thing with the funds. The funds were established at different points in time to respond to specific goals. And now we are at a specific point in time where scale and speed matters and bringing institutions together for greater impact. So, I mean, you've mentioned yourself that this week the conversation and I wasn't here, I wasn't able to follow this week, the conversation was a lot about MDBs, and there's a lot of focus on MDBs. I think the conversation needs to be broader because MDBs are very important. We have many reports out there that really make it very clear. We have four areas where we need significant action: domestic capital mobilization, and this can be done through different ways, and in fact, most of the investment is actually coming from domestic, private sector capital mobilization, again through a variety of ways, then we have MDBs, and then we have the funds. We have the capital that is allocated through funds, concessional risk capital. And so, the conversation needs to continue to be around these four lines, and how these need to work with each other to deliver. So yes, you said, OK, there's a lot of conversations around the MDBs and them unlocking private capital, but the conversation needs to be even broader. OK MDBs unlocking private capital. How do they need funds like ours or these type of resources to enable them to do that, or what is it that they can do by themselves without this capital? How do they need this capital? What can this capital of Green Climate Fund and is similar do to unlock even beyond the MDBs? Because we do work of the Green Climate Fund, as I was saying, we do work directly with governments, and we do work directly with private sector. So, what can we do to unlock that domestic capital mobilization and private sector capital mobilization?

So, I'm not saying that it's not understandable. I think it's understandable because people need to dedicate resources and political capital and effort to get something like that, which is substantive, like a reform of an MDB is not an easy task. So, they have to invest quite a bit of political capital into it, but I think we need a more holistic and integrated way of pushing the agenda. Because what we have seen in the MDBs is, yes, they can do more, but they can do up to a certain point and beyond that point they will need other type of capital. Precisely because of the fact that they want to retain their Triple-A credit rating.

CLEMENCE LANDERS:
So, I'm going to open it up to the audience for questions, but I'm going to be very selfish and ask one more. But I want you to start thinking about questions while we can be fast on this one. So, you mentioned the Green Climate Fund is on a replenishment cycle. So, you have to every four years, go to your donors, to get recapitalized. Yes. We at CGD recently put out a piece called “The Replenishment Traffic Jam” because we have found in 2024 and in 2025, about 12 funds, so this isn't yours, are coming to donors the same donors largely, and for about $100 billion.

MAFALDA DUARTE:
Yes.

CLEMENCE LANDERS:
A lot of these funds have remained cash in, cash out. So, $1 in is $1 out. This year we're in an IDA year. We just had a panel on IDA. It's a hard replenishment, but IDA has been able to multiply the amount of funding it gets from donors through a lot of different financial, I wouldn't say innovations, but a lot of different financial measures. They have loans, they have portfolio, they've gone to capital markets.

MAFALDA DUARTE:
Yes.

CLEMENCE LANDERS:
And so, in a way, IDA is a little bit more protected from the vagaries of donor generosity and parsimoniousness. You were at the Climate Investment Funds, launched a capital market mechanism where you basically leveraged the portfolio and were able to really kind of increase the magnitude of the climate funds. Is this something that you could do with the Green Climate Fund as well?

MAFALDA DUARTE:
Let me go back first to your point of the vagaries of this system. I think again, and I'm not saying anything new because these conversations are very active, lively conversations. We have to think hard whether the current model is fit for purpose. Because here we are talking about MDBs having to triple their capabilities. That's what the information is out there. They need to triple their balance sheets. We need concessional capital that is five times what we have at the moment. There are very difficult conversations happening at the moment in the United Nations Framework Convention on Climate Change context on the new collective quantified goal. And everybody knows that the levels of investment that are happening right now are not nearly enough, and so therefore it has been analyzed that we need these different types of capital to come in at a different scale. So, then we go back to that question, which is, is the system fit for purpose to enable the tripling of the MDBs balance sheets?

They will have to go and ask for capital increases. And then, as you said, we have the myriad of funds that have replenishment cycles, and not just for climate because, it's climate, it's health, it's education, it's, you know, all of the SDGs. Is this system fit for purpose? I think we have to be honest and say no. And it's a system that is very susceptible or exposed to political cycles and uncertainties. But the challenges are there. I mean, the climate challenge is not going to wait for the political cycle to be favorable or unfavorable to a specific. And we have to understand, I think it's really important to understand that if we don't tackle climate, many of the things that we are really concerned with, that are very present every day to us, it hits us in every news outlet, conflict, displacement, environmental collapse. So, we really have to think hard about what is that fit-for-purpose system. Where are we going to raise the money in such a way that we are not so exposed to a high level of dependency of a very narrow base.

And by the way, because the budgets of these governments are under pressure not just to respond to climate, but we know there was a pandemic. There are multiple challenges, and so no, the system is not fit for purpose. And therefore, I've also been saying that I do hope that we find a way of moving forward conversations around global taxation. There are many different options out there. There's a menu of options that are being analyzed, that people are discussing, and if there are other ways that others can bring forward to respond to what is a very unfit for purpose system, I think that's where we need to focus a lot of our energy, attention and efforts.

CLEMENCE LANDERS:
Yeah, I couldn't agree more. And I think global taxation is one of those things that may seem impossible and then overnight may become absolutely just inevitable. So, a little word of optimism there, but I share your perspective. Can I now turn to the audience? And if you could just wait for a microphone, I see a question here. Oh, all of a sudden everyone has a question. If you could, I'll take about three at a time. So, I'll take these three, if you could introduce yourself. If you could be brief. Ask a question and there you go. Hello.

SPEAKER:
Great. Thank you so much. It's been really great hearing your perspective this morning. My name is (UNKNOWN) from the Climate Policy Initiative. You mentioned country platforms a little bit earlier. So, I was wondering if you could speak a little bit to whether you think that they are the right mechanism for coordination across all of the development partners, or will they be kind of another piece of the puzzle that's adding to the layers that countries have to be kind of coordinating on? Thank you.

CLEMENCE LANDERS:
That's a great question.

MAFALDA DUARTE:
Should I take one by one? OK.

CLEMENCE LANDERS:
Let's group them.

NIKOLA SWANN:
Hello? Nikola Swann, SwissThink. If I could, I would just ask you to go back a bit to the question that I think the moderator had started about scaling. And I guess to me, it seems the classic model for scaling the MDB model is you get money from the governments, and you call it equity capital, you borrow from the private sector to leverage that. And this is how you get mobilization and scale. So, is this something that is in the future for your funds? That's my question.

CLEMENCE LANDERS:
And there was one last one from the gentleman in the back. Yep.

SPEAKER:
Hi. (UNKNOWN). I was a founder of an incubator in Iraqi Kurdistan, where I'm originally from, and also spent a couple of decades in environmental determinants of health. I don't want to ask you, because it'd be preaching to the choir about the role of innovators and young people and women, especially at the community level, to come up with climate mitigation adaptation, nor about the cyclical effect of climate and conflict. But speaking of the systems that are fit for purpose, I would love to hear your perspective about, you know, you have a tremendous effort and great work. And thank you for the work you've been doing in supporting Iraq, of course, and crowding in private sector. But the fund and MDBs and the international system is still focused on engaging countries, supporting countries, international organizations, MDBs, and sometimes, to put it lightly, they're not the most representative of the civil society voices and the innovations on the ground. What would be your vision over the next couple of years to bring in more of that voice, whether it's through your project support and project planning and knowledge management, or whether it's through other ways of engaging civil society voices and supporting them?

Thank you.

CLEMENCE LANDERS:
So, country platforms.

MAFALDA DUARTE:
OK. Let's go one by one.

CLEMENCE LANDERS:
Yeah. Organizing the disorder. Then we have a question on scaling mobilization and then a question on how can we bring these organizations closer to civil society, governments, what's happening on the ground.

MAFALDA DUARTE:
OK.

CLEMENCE LANDERS:
Your order. Your choice.

MAFALDA DUARTE:
On country platforms, and again, I think there's a lot of different interpretations of what this is. So, I'm a supporter of a model that is country led, and that brings all of the key partners to the table in that country, be it private sector, MDBs, funds, civil society and that that process is supported to come on the end of it with a clarity on priorities, strategic priorities of the country and alignment of the different efforts and finance towards those strategic priorities. So, that's how I see value in country platforms. And I have been making the offer that the readiness program of the Green Climate Fund, which is actually the largest grant mechanism that I have seen in this landscape- our board last year just to prove $500 million grant to do things like this. So that these processes can be supported because I think the model that again, we have at the moment, which is one project by one project by one project and the lack of alignment, so again, it's this issue of fragmentation.

There's a country that I'm not going to name again, that I visited, and the government was basically telling me we have five strategic priorities, but the partners that come to us only want to focus on one. So, empowering the governments to be able to enable that process, and, you know, funds like ourselves can be there because we nevertheless play as an incentive to the financiers to align themselves as well with country priorities. That's how I see value in country platforms. I mean, if we had a lot more time, we could go on because I was quite involved in the JETPs as well. And there's a lot of lessons to be learned from that experience, but I find value in that. In terms of civil society organizations, we actually fund civil society organizations, and because of the deliberation and commitment to target the most vulnerable people and communities, we are looking very carefully at the partners, the modalities through which we can further empower them in delivering finance to these communities, the most vulnerable.

But we are also, again, coming back to the country platforms. We are going to be more deliberate in encouraging also governments in bringing the civil society organizations to the conversations on country programs or client country platforms. So, those are just some of, and for example, I mean, the fund has this indigenous people advisory group, which we convene and we are trying to work very closely with them to see what more can we do? What are the entities that we should partner with? Again, what are the modalities to deploy finance to the indigenous people? Now this question here on the model of public equity to leverage the balance sheet, which is the model of the MDBs. It doesn't have to be that model. So, we are exploring different models. That is one model, but it's not the only model to ensure we use the finance as efficiently as possible, while at the same time, we understand that one of our mandates, again, is to provide grants to the most vulnerable, and in particular for resilience or adaptation purposes.

So, how does one think about that plus other parts of the portfolio which actually provide returns on those investments, and what are then the models to basically make sure that this finance is being managed as efficiently as possible? But again, I don't think that there's just that model of public equity to leverage the balance sheet.

CLEMENCE LANDERS:
I'm looking at my timekeeper. We have five minutes left. So, I'm going to take two more questions, or maybe three more if you can. OK. Let me start with this side this time. There are two women in the front.

KATERINA SANTOS:
Thank you so much. Katerina Santos, I work for a climate social enterprise in Africa. I was hoping we could zoom in on one of the instruments. Because I would love to hear your thoughts about the role that carbon credit projects play in advancing the climate mitigation agenda, especially in the Global South to advance that agenda as well as furthering the broader SDGs. Thank you.

MAFALDA DUARTE:
OK. Should we take one by one or more than one?

CLEMENCE LANDERS:
Is that your preference? What would you prefer?

MAFALDA DUARTE:
No. You just need to remind me if I forget. Thanks.

KERRY KLUTSE:
And thanks so much again for being here and coming straight off a plane as well. Hats off to you. I'm Kerry Klutse with Open Contracting Partnership, and one thing that we've been thinking about recently that brings together a lot of the threads that have come out here, whether it's getting more money coming in, figuring out how to support projects on the ground, especially aligning with country priorities, how to deal with sort of, better organizing and coordinating among all of the different entities that are involved. We've been inspired by a project we've been working on in Ukraine that's tracking all of the donor funds coming in, how to prioritize projects on the ground, and then especially which hasn't come up much, how those funds are spent and what is actually delivered. Curious to hear a bit about your thoughts on that, if there are things sort of in process for that end-to-end tracking and prioritization on the ground. Thanks. And if anyone's interested in talking, I'm here.

MAFALDA DUARTE:
OK. Carbon credits. That would be another really long conversation. What I can tell you is, in the Green Climate Fund, actually, I'm just coming out of the board, and the board approved us having sort of like a more mainstreamed approach to support REDD+ efforts. What does this mean? It means that we are now going to be able to support countries which have already accrued credits in a certain period of time. I think it's 2019 to 2022 and reward them for that. But is an incentive for them to invest in further, assuring credits from forestry. So, that that had been paused because we had a pilot for some years and had been paused on the basis of lessons learned with that pilot, the board just agreed to not have it as a pilot, to just have it as a mainstream instrument in our tool kit, let's say. I think we will have more conversations around carbon credits. And there are many issues around carbon credits, and we know that integrity of what we do is really important. So, I'll leave it at that.

The questions on, your question was Ukraine and impact. Broad impact. So, I mean, it's a very good question because the fact of the matter and this is where the beneficiaries, so local communities, and a big voice on that are precisely civil society organizations. That a lot of the resources don't trickle down to the community. They get used through various intermediaries. But this is also quite broad and generic because it also depends on the types of investments. What is the objective of the investment? But I do think even when the projects intend to reach the local communities and the vulnerable communities, there are studies indicating that most of the resources don't reach there because they get lost in the intermediary chain. I think we have to acknowledge that this is also why I was saying that we are looking at what are the modalities that would enable less loss in the process. And basically, what are more of the more direct mechanisms or that reduce as many of the intermediaries as possible so that you maximize in fact, how much of the resources go there?

So, this is an issue of modalities. Looking at the operational modalities, how do we get the money to the communities. And then of course, it's an issue of the systems that we have in place to monitor the impact and learn from what's working and not working. So those are two areas that are part of what we have embraced as well, in the context of the 50 by 30 vision.

CLEMENCE LANDERS:
Well, thank you. I'm afraid I'm going to have to close it out here, but I'm happy that we ended the conversation on impact, because I think that is a very, very important topic as well. But Mafalda, I really appreciate the frank exchange, and it was an absolutely fascinating conversation. So, this is a wonderful point in which to end our programming here at CGD for the week. Thank you again.

MAFALDA DUARTE:
Thank you.