Show me the money

I’ve been grappling with unfamiliar Mexican pesos now that I’ve arrived in Cancun.

It’s hard to tell whether I’ve got a favourable exchange rate or not – but what I do know is that the wodge of cash I’ve got to get me through the trip is startlingly thick.

Yet this is small fry compared to the financial issues that’ll be confronting negotiators as the UN climate talks open today.

One of the much trumpeted moves to come out of the negotiations in Copenhagen last December was a pledge that US$100 billion a year would be delivered for developing countries to tackle climate change. Great, you might think.

But, of course, there was a catch. Or several, in fact.

Tricks of the trade

The first – and most glaring – was that this is far below even the most conservative estimates of the amount of money developing countries need to tackle climate change.

The second is the recommendations of the impressively-titled High-Level Advisory Group on Climate Finance, convened by UN Secretary General Ban-Ki Moon.

Its mission was to recommend how this money should be raised – and in October it suggested a lot of it should come from a global carbon market.

This is a big problem. The price of carbon is notoriously volatile, so this wouldn't provide the steady stream of money that's so necessary for developing countries.

Not only that, but the carbon trading has been of increasing interest to banks, hedge funds and speculators – with the risk it could be the source of the next big financial crisis if carbon markets go global.

And thirdly, Friends of the Earth doesn't want the World Bank involved either.

Don't Bank on it

There's a big push by many rich countries – who conveniently, have a big say in how the Bank's run – to put it in charge of the money they'd give to developing countries.

Fair enough, you might say – but with the Bank being one of the largest lenders for fossil fuel projects worldwide, a large neon sign flashing 'conflict of interest' appears.

Friends of the Earth thinks the best solution is a Global Climate Fund, run democratically with a say from all countries on how the money's spent, which provides enough money for developing countries to tackle climate change head on.

Luckily it's our expert campaigners who've come up with that. At the moment, it's all I can do to keep track of my change.

Henry Rummins is a communications and media officer at Friends of the Earth. He's travelling to the climate talks in Cancún to report as part of the Friends of the Earth International delegation.