The document discusses climate change challenges and opportunities in Ghana, and the need for climate finance. It notes that climate change affects Ghana's development prospects now by posing risks but also opportunities through new international support mechanisms. Ghana's climate policy addresses adapting to impacts and mitigating emissions through climate-resilient and low-carbon development. Effective response requires significant financial flows above what has been committed. The document outlines MoFEP's roles in mobilizing, locating, implementing, and tracking climate finance through the national budget and public financial management systems to build large-scale response and integrate funding into wider development planning and processes.

1. Background on climate change and climate finance
MoFEP June 2011
Climate change affects economic output, livelihoods and development
prospects in Ghana now. Climate change both poses challenges and affords
opportunities for development, growth and poverty reduction. Challenges because it
risks reversing development gains and undermining Ghana’s future growth and
development path. Opportunities because new international mechanisms of support
are emerging to help deliver on national development objectives in the face of climate
change.
Climate change has two main aspects – adapting to its impacts and mitigating
(reducing) emissions of the greenhouse gases that cause climate change. These
have responses in “climate-resilient” and “low carbon” development. These are
captured in Ghana’s National Climate Change Policy Framework. It includes a pillar
on climate financing mechanisms. The framework needs to be elaborated further
and translated for action across sectors and stakeholders.
Effective response to the impacts of climate change on development requires
significant financial flows, far above any previously committed. Finance is a key
part of the international deal being negotiated under the UN Framework Convention
on Climate Change (UNFCCC). Ghana needs to have an informed view to feed into
negotiations but also set in place the necessary arrangements and mechanisms to
access existing and emerging climate finance in a coherent and strategic manner.
Financing scaled-up climate change investments requires a combination of
private flows, public domestic resources and external public resources. Global
public finance and domestic frameworks to set the rules are key.
There are key roles and opportunities for MoFEP on climate change. A key
issue is to establish mechanisms to manage fiduciary risks at scale. This requires
linking to core public financial management mechanisms, including budget guidelines
(to set signals), budget hearings, GIFMIS and standard reporting.
Key MoFEP functions could include:
• Mobilisation of finance (sources – e.g. fiduciary risk management and for
considering applications at Ghana level with EPA/MEST)
• Location of finance (resources – e.g. budget and budget guidelines)
• Implementation (delivery of finance - including linking to planning process
and medium-term national and sectoral development plans)
• Tracking achievement and progress to inform dialogue and secure/maintain
financial flows (Measurement, Reporting and Verification, managing
fiduciary risk standards)
Government of Ghana needs to demonstrate strong leadership, across sectors,
to present a vision of a climate-resilient and low carbon future for
development.
Strategies to address climate change will be of greatest value as part of
Ghana’s wider national planning and implementation processes, including the
Medium Term National Development Plan. Funding that is fully integrated into public
financial management systems, e.g. budgets and expenditure frameworks, builds
potential for large scale response.
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