Meeting of the Board 30 September 2 October 2017 Cairo, Arab Republic of Egypt Provisional agenda item 16 GCF/B.18/07 14 September 2017 Readiness and Preparatory Support Programme: progress report Summary The document provides an overview of progress made by the Readiness and Preparatory Support Programme since its inception, with a focus on results expected under the programme and progress since the last Board meeting. The Board is requested to take note of the information provided in this document.
Page b Table of Contents I. Introduction 3 II. Progress overview 3 2.1 Progress in 2017 and outlook into the remaining months of 2017 5 III. Results achieved and expected outcomes 6 3.1 Strategic frameworks, including country programmes and pipeline development 7 3.2 National stakeholders engagement processes 8 3.3 Strengthening direct access entities capacities and pipelines 9 3.4 Establishment of no-objection procedures 10 3.5 Private-sector engagement and mobilization 11 3.6 Adaptation planning process 3.7 Knowledge-sharing and learning strengthened 13 IV. Monitoring of readiness grants 14 4.1 Portfolio overview and key issues 14 4.2 Remedial measures undertaken to address issues 15 V. Readiness Programme budget 16 5.1 Programme budget utilization 16 5.2 Budget forecast to close the rest of 2017 17 5.3 Budget projections for 2018 19 Annex I: Readiness and Preparatory Support portfolio by region as at August 2017 21 Annex II: Readiness and Preparatory Support in pipeline as at August 2017 38 Annex III: Expected results from the readiness resources disbursed 42 Annex IV: Countries whose national designated authorities/focal points nominated entities that are receiving in-kind accreditation support as at August 2017 48
Page 3 I. Introduction 1. The Board approved the operationalization of the Readiness and Preparatory Support Programme through decision B.08/11 and requested the Secretariat to report biannually to the Board on the progress of the programme. Given the interest in the early progress of the programme, the Secretariat has been reporting on it to the Board at each meeting since its ninth meeting in March 2015. 2. This report provides an overview of the cumulative progress achieved under the programme up to August 2017. This update focuses on the outcomes that the programme has achieved to date, projected programming for the last four months of 2017, and estimated demand for 2018. The report also includes a section on progress in the implementation of readiness grant agreements that have received disbursements, early challenges faced and remedial measures being taken. The report finally outlines the lack of financial resources to approve all the requests submitted in 2017 and projecting into 2018. The work programme for the Readiness and Preparatory Support Programme is included in the Secretariat Work Programme for 2018 (under preparation). II. Progress overview 3. As at August 2017, the GCF has engaged with 114 countries on 215 readiness requests. Figure 1 below is a summary of the requests by type of activity. Figure 2 below depicts the summary of requests by region. Seventy-nine of the 114 countries are small island developing States, least countries or African States, which make up 69 per cent of the countries requesting readiness support (see figure 3). 4. Of the 3 readiness requests approved, 73 of them (59 per cent) have received disbursements, and entered the implementation stage. The programme has accelerated disbursements in 2017, reaching a cumulative total disbursement of USD 10.30 million as of August 2017 (see table 1). Table 1: Quarterly disbursements since 2015 up to August 2017 (United States dollars) Quarters (Q) 2015 2016 2017 Q1 77,306 328,913 1,520,768 Q2 56,748 696,400 1,601,594 Q3 15,950 399,815 3,766,134 Q4 163,668 1,657,800 Total 313,672 3,082,928 6,888,496 Note: The amount for 2017 Q3 includes disbursements up to 31 August 2017 only.
Page 4 Figure 1: Number of readiness requests by type of activity as at August 2017 Type of activity Submitted (USD amount) Approved (USD amount) Disbursed (USD amount) NDA strengthening, incl. country programmes 114 (37,205,050) 81 (24,661,187) 50 (7,089,656) Support for direct access entities 41 (7,706,565) 32 (4,320,395) 17 (1,016,643) Adaptation planning processes 35 (97,450,688) 3 (8,198,817) 2 (1,270,094) Strategic Frameworks 25 (11,563,147) 7 (2,295,830) 4 (919,735) All activities 215 (153,925,450) 3 (39,476,229) 73 (10,296,8) Abbreviation: NDA = national designated authority. Figure 2: Readiness requests per region as at August 2017 Region Submitted (USD amount) Approved (USD amount) Disbursed (USD amount) Africa 91 (70,862,535) 44 (13,299,677) 27 (4,162,058) Latin America & Caribbean 52 (35,609,527) 34 (9,341,166) 19 (2,406,170) Asia - Pacific 60 (33,385,425) 39 (15,301,471) 24 (3,353,555) Eastern Europe (14,067,963) 6 (1,533,915) 3 (374,345) Total 215 (153,925,450) 3 (39,476,229) 73 (10,296,8) Figure 3: Readiness requests per GCF classification as at August 2017 Region Submitted (USD amount) Approved (USD amount) Disbursed (USD amount) SIDS, LDCs, Africa 143 (98,854,409) 84 (27,9,878) 54 (8,411,281) Other 72 (55,071,041) 39 (,346,351) 19 (1,884,847) Total 215 (153,925,450) 3 (39,476,229) 73 (10,296,8) Abbreviations: LDC = least country, SIDS = small island developing States.
Page 5 2.1 Progress in 2017 and outlook into the remaining months of 2017 5. In the first three quarters of 2017, the Secretariat received 8 submissions from countries, comprising of 76 submissions in the first two quarters and 52 submissions in the third quarter (see annex II for the pipeline of requests). It is anticipated that an additional 64 proposals will be received in the fourth quarter, thus bringing the total number of submissions in 2017 to over 190 proposals. The fourth quarter estimate is based on information from the Secretariat s day-to-day dialogues with countries, and information shared by delivery partners supporting countries. The submissions and approvals in 2017 (actuals and estimates) are presented by region (table 2) and by readiness activity (table 3). 6. As at August 2017, the Secretariat received a total of 8 readiness proposals, 29 of which are for national adaptation plans (NAPs) and/or other adaptation planning processes. Of the 99 readiness proposals that are not related to adaptation planning, the Secretariat has approved 37 which amount to a total of USD 10.51 million. Of the 29 readiness proposals for NAPs and/or other adaptation planning processes to date in 2017, 24 (82 per cent) were submitted with one of two international accredited entities as the delivery partner. The inter-divisional endorsement committee has reviewed 35 readiness proposals (including 5 seeking adaptation planning support) and these are pending approval, which total USD 23.63 million. In addition to the adaptation planning proposals approved or endorsed pending approval, the Secretariat has provided written comments on a further six proposals, which are now pending resubmission or further consideration; and has conducted initial review on an additional seven proposals. The Secretariat is also continuing to process the remaining 43 readiness proposals (including for adaptation planning support). With an additional 63 readiness proposals expected in the fourth quarter (of which 20 are anticipated to be for adaptation planning support), countries will be expecting the Secretariat to process nearly 119 proposals during the remainder of 2017. 7. With the Secretariat s current capacity, it may only be possible to review an additional 20 to 30 proposals during the rest of 2017; thus only approving 110 130 of the 180 200 submissions by the end of this year. This problem principally arises because of capacity constraints resulting from limited staffing (where the same staff are focusing both on accelerating disbursements and supporting adaptation planning proposals), delays in automation and outsourcing as well as staffing transitions. Despite efforts to address the capacity constraints, the Secretariat is expected to process up to 80 per cent of readiness requests not related to adaptation planning by the end of 2017. Approval of all the remaining readiness proposals and some (28) adaptation planning proposals that are currently or foreseen to be received are likely to be carried forward to 2018.
Page 6 Table 2: Actual and estimated quarterly requests and approvals (up to 31 August 2017), by region (number of requests, USD values in brackets) Regions Africa Latin America and the Caribbean Eastern Europe Asia Pacific Total Submitted (actuals) Q1 Q2 Q3 Q4 Approved (actuals) Submitted (actuals) Approved (actuals) Submitted (actuals) Approved (estimate) Submitted (estimate) Approved (estimate) 11 3 20 4 24 6 32 19 (9,087,646) (808,000) (,987,138) (663,137) (30,605,677) (2,611,882) (27,185,000) (4,115,000) 13 9 8 2 10 4 8 3 (9,644,981) (2,894,191) (9,752,868) (408,203) (8,473,836) (1,252,051) (16,300,000) (1,300,000) 4 1 1 5 1 1 (3,836,914) (300,000) (3,000,000) (9,325,656) (33,915) (300,000) 10 7 9 6 5 22 13 (9,475,361) (3,155,691) (2,550,613) (1,568,163) (10,521,799) (2,093,695) (26,285,000) (4,585,000) 38 20 38 52 16 63 35 (32,044,902) (7,157,882) (28,290,619) (2,639,453) (58,926,968) (5,991,543) (70,070,000) (10,000,000) Table 3: Actual and projected quarterly requests by activities (up to 31 August 2017) (number of requests, USD values in brackets) Activities NDA strengthening and country programming Support to direct access entities Strategic frameworks Adaptation planning Total Submitted (actuals) Q1 Q2 Q3 Q4 Approved (actuals) Submitted (actuals) Approved (actuals) Submitted (actuals) Approved (estimate) Submitted (estimate) Approved (estimate) 23 15 13 6 15 5 16 13 (8,695,159) (5,707,749) (4,179,711) (1,879,711) (6,901,654) (2,313,295) (5,900,000) (4,900,000) 4 2 8 5 9 7 7 6 (1,153,000) (508,000) (1,828,014) (421,062) (2,252,219) (1,733,406) (520,000) (210,000) 4 3 10 1 4 20 16 (1,292,133) (942,133) (5,193,953) (388,680) (6,995,502) (1,944,842) (6,150,000) (4,890,000) 7 7 15 20 (20,904,610) (17,088,941) (42,777,594) (57,500,000) 38 20 38 52 16 63 35 (32,044,902) (7,157,882) (28,290,619) (2,639,453) (58,926,968) (5,991,543) (70,070,000) (10,000,000) Abbreviation: NDA = national designated authority. III. Results achieved and expected outcomes 8. The readiness proposals approved, under implementation or completed help to identify initial results achieved as well as results that may be expected in the coming months and over the next couple of years. Most of the readiness proposals under implementation are to strengthen national designated authorities (NDAs) and to enable them to develop a strategic framework, including country programmes, followed by providing support to direct access entities, support to access climate finance and finally, support for private sector mobilization. More recently, benefiting from an increase in Secretariat capacity, increased support is also being directed towards NAPs and/or other adaptation planning processes. The sections below include key results expected, including anecdotal examples of countries, building on the last report presented to the Board.
Page 7 3.1 Strategic frameworks, including country programmes and pipeline development 9. A key expected outcome is the development of country programmes and pipelines of projects/programmes. Recipient countries are supported to engage with stakeholders in their countries, as well as with accredited entities and the Secretariat, to further develop their country programmes and pipelines that serve to implement priorities in their nationally determined contributions and other national strategies or plans. Box 1 showcases activities planned in Mauritania. Box 1: Activities undertaken to develop a country programme and pipeline of projects in Mauritania MAURITANIA Review existing policies and strategies to identify national adaptation and mitigation priorities Organize one multi-stakeholder consultation workshop on priorities for engagement with the GCF Draft the country programme Organize four roundtable discussions on the country programme and a high level meeting to validate 10. Since the last report, several countries have progressed towards the following results: (i) (ii) (iii) The Federated States of Micronesia (FSM) completed a draft of the country programme, through a consultative process, and presented it to other Pacific island countries and other partners at the Pacific Regional Dialogue in July 2017. FSM has distilled key areas of priority for the GCF over the short, medium and long term, and engaged a project development specialist to assist in the process to further refine priority areas towards project concepts and to secure accredited entities (AEs) and partners to take the programme forward; Gabon determined the initial country strategic priorities, with an early definition of investment opportunities across sectors in country programming. Gabon began structuring the NDA team and its institutional arrangements by recruiting the first consultants and drafting terms of reference in order to form its climate finance task force and advisory technical committee. Gabon has put together a capacitybuilding plan, identifying the need for strengthening climate finance and project management capacities; and Mali also produced a draft country programme, and is waiting for comments from the stakeholders before it can be finalized and presented at a national workshop during the second half of 2017. It also gathered inputs for the country programme through an open call for projects. 11. Other countries expected to develop similar country programmes include: (i) (ii) 2017: Bangladesh, the Central African Republic, Ethiopia, India, Mauritius and Pakistan; and 2018: Albania, Bahamas, Barbados, Belize, Bolivia (Plurinational State of), Chile, Colombia, Costa Rica, Dominica, Dominican Republic, Ecuador, El Salvador, Georgia, Grenada, Guatemala, Guyana, Haiti, Honduras, Jamaica, Kazakhstan, Kyrgyzstan, Mauritania, Montenegro, Morocco, Namibia, Oman, Paraguay, Peru,
Page 8 Republic of Moldova, Saint Vincent and the Grenadines, Tajikistan, Tonga and Uruguay. 3.2 National stakeholders engagement processes. Another key outcome of readiness support is to enable NDAs to engage the stakeholders in their countries to conduct dialogues and consultations, particularly on country programmes. Fifteen grants under implementation will produce this result by the end of 2018. These consultations are planned to be conducted with the balanced and effective representation of all relevant public, private and civil society stakeholders, including women s groups. Box 2 showcases activities planned in Colombia. Box 2: Activities planned in Colombia to engage national stakeholders on country programmes COLOMBIA Design publications and communication products in digital and physical formats related to the processes of the GCF Articulate the priorities, and coordinate the engagement with relevant stakeholders Conduct workshops and training on climate finance to incorporate climate change in planning and budgeting Develop communications material of funding proposals in prioritized sectors 13. Using readiness resources, Guyana a communications strategy to help raise awareness of the GCF and its operational modalities among key national stakeholders. The strategy aims to support Guyana to administer its responsibilities relating to the GCF, covering the period to the end of March 2018. The strategy details planned communications activities, products and target audiences, and is intended to be a living document that will be updated as the project progresses and as new information emerges about the needs and preferences of the target audiences. 14. Other countries expected to engage with national stakeholders on country programmes include: (i) (ii) 2017: Bangladesh, the Central African Republic, Ethiopia, Gabon, India, Mali, Mauritius, Montenegro and Pakistan; and 2018: Albania, Bolivia (Plurinational State of), Chad, Chile, Costa Rica, the Congo, the Democratic Republic of the Congo, Djibouti, Dominica, the Dominican Republic, Ecuador, El Salvador, Gambia, Georgia, Guatemala, Guinea, Haiti, Honduras, Jamaica, Kazakhstan, Kyrgyzstan, Liberia, Mali, Mauritania, Micronesia (Federated States of), Morocco, Namibia, Oman, Paraguay, Peru, Senegal, Swaziland, Tajikistan, Timor-Leste, Togo, Tonga, Tunisia, Uruguay, Vanuatu and Zambia. 15. Furthermore, countries are leveraging support from different AEs and other development partners to initiate early stages of stakeholder engagement and consultations. Examples include national workshops held in Costa Rica, Kazakhstan, Kyrgyzstan, Mexico, Peru and other countries. The GCF Secretariat has lent support to NDAs for such stakeholder engagement through advice on the agenda, the provision of materials and, in some cases, through virtual or physical
Page 9 participation. Growing demand for such support will require the Secretariat to strengthen its capacity to effectively respond to such requests. 3.3 Strengthening direct access entities capacities and pipelines 16. A third outcome of readiness support is to enable support for direct access entities in the accreditation process, from identification to accreditation, and once accredited develop their capacities to build their pipelines as articulated in their entity work programmes and to effectively implement projects/programmes funded by the GCF, including the pilot programme to enhance direct access. Box 3 showcases activities supporting the South African National Biodiversity Institute (SANBI) to achieve the outcomes post-accreditation. Box 3: Activities that South Africa is conducting to develop the South African National Biodiversity Institute pipeline and concept notes and funding proposals SOUTH AFRICA Conduct a dialogue to discuss and update current and future projects funded by the GCF and enhance partnership between the NDA, AE and the Secretariat Prepare a country programme using the initial guidelines prepared by the Secretariat Strengthen NDA/AE capacity to access preparation support for developing funding proposals Ensure funding proposals are aligned with and adhere to national climate change and sustainable development priorities Abbreviations: AE = accredited entity, NDA = national designated authority. 17. Proposals for activities such as the one approved for SANBI have also been approved for the Agency for Agricultural Development of Morocco, Centre de Suivi Écologique in Senegal, and Environmental Investment Fund of Namibia, and these readiness activities are expected to yield similar outcomes to the SANBI case highlighted above. 18. With the technical assistance provided by the programme, two direct access entities, the Central American Bank for Economic Integration (CABEI) and the Micronesia Conservation Trust (MCT), were accredited at the fifteenth meeting and seventeenth meeting of the Board, respectively. Three more have reached Stage II of the accreditation process, and an additional five have reached Stage I. The provision of technical assistance for institutional gap assessments on the accreditation requirements and action plans reduces the time taken for reviews undertaken at Stage I and Stage II. 19. Other countries expected to strengthen the capacities and pipelines of direct access entities include: (i) (ii) 2017: Antigua and Barbuda, and Chile; and 2018: Albania, Argentina, Armenia, Dominican Republic, Egypt, Haiti, Jamaica, Jordan, Kazakhstan, Morocco, Namibia, Oman, Tajikistan, Tonga and Uruguay. 20. Further in-kind guidance and support by the Secretariat and its regional advisers has also been provided to 146 entities nominated by the NDAs/focal points of 68 countries in all four regions, which helps such entities to understand the accreditation requirements and advance their applications through the accreditation process (see the list of countries in annex IV).
Page 10 3.4 Establishment of no-objection procedures 21. A fourth expected outcome of readiness support is the establishment of transparent and efficient no-objection procedures in countries. Forty-two countries expect to establish such a procedure, thus enabling the NDAs or focal points of these countries to lead effective coordination mechanisms, prioritize interventions for the GCF, and monitor, oversee and streamline climate finance in their countries. The example of Kiribati is showcased in box 4 below. Box 4: Activities that Kiribati is conducting to establish a no-objection procedure KIRIBATI Design processes and procedures to consider new proposal ideas, review and approve proposals and submit noobjection [letters?] Convene a one-day workshop to discuss processes and procedures for noobjection [letters?] and proposals Identify and provide the necessary capacity development training to strengthen the NDA team and other stakeholders for effective project/programme management, monitoring and evaluation Abbreviation: NDA = national designated authority. 22. With the readiness support, the following countries have shown early results under this outcome: (a) (b) (c) (d) Vanuatu has a comprehensive and country-driven approach to assessing project ideas, concepts and proposals put forward by all stakeholders before the issuance of a no-objection letter, with a turnaround time of 1 2 months. This includes a tailored project concept note form and a publicly disclosed procedure which provides certainty for proponents; Guyana established a National GCF Steering Committee with an overarching mandate to direct, coordinate and deal with the related issues for defining the mode of mobilization and use of funding from the GCF. It will support all tasks related to the GCF, including implementing the no-objection procedures for approving funding proposals and concept notes, as well as nomination of prospective direct access entities to the GCF; The Cook Islands has a no-objection procedure through a learning by doing approach and has considered seven projects to date. The process includes the assessment by the NDA of key elements of projects, as well as an approval process involving other relevant offices and bodies building on existing systems. The country is in the process of further refining and formalizing the procedure, which will clarify timelines for stages of the process, ensuring the relevant ministries and stakeholders are formally engaged in the review and recommendation process, and expects the Cabinet to approve the final noobjection procedure; and Countries such as Chile and Costa Rica have initial procedures that have been broadly shared and validated with national stakeholders and are also serving as good examples for other NDAs in the region through south south exchanges. With GCF readiness support, they will further detail and adjust procedures based on their early experiences. 23. Other countries expected to establish no-objection procedures include:
Page 11 (i) (ii) 2017: Bangladesh, Central African Republic, Cook Islands, Ethiopia, Gabon, Guyana, India, Maldives, Mali, Montenegro, Pakistan, Thailand and Vanuatu; and 2018: Albania, Bolivia (Plurinational State of), Chad, Congo, Democratic Republic of the Congo, Djibouti, Dominican Republic, Ecuador, El Salvador, Gambia, Georgia, Guatemala, Guinea, Haiti, Honduras, Jordan, Kiribati, Kazakhstan, Kyrgyzstan, Liberia, Mali, Mauritania, Micronesia (Federated States of), Morocco, Namibia, Oman, Paraguay, Republic of Moldova, Senegal, Swaziland, Tajikistan, Timor- Leste, Togo, Tonga, Tunisia, Uruguay and Zambia. 3.5 Private-sector engagement and mobilization 24. A fifth outcome that countries are expected to realize from readiness support is the mobilization of private-sector finance for climate action in their countries. Countries engage the private sector during their country consultative processes to identify opportunities to create enabling environments and to crowd-in private-sector investments from domestic as well as regional and international investors. Such engagements could result in the development of funding proposals for private-sector projects or programmes, including under the request for proposals targeting small- and medium-sized enterprises or to mobilize funds at scale. For example, Vanuatu has and launched in July 2017 the Vanuatu Business Resilience Committee which fosters private sector engagement in low-emission high climate resilient development in Vanuatu. The case of Jamaica is showcased in box 5 below. Box 5: Activities that Jamaica is conducting to engage and mobilize the private sector JAMAICA Engage in dialogue with the private sector through a consultative process with the NDA (regional workshops) Analyse barriers and propose recommendations to maximize privatesector engagement in climate change initiatives Launch a Call for project ideas from regional private sector entities aligned with the GCF investment criteria and the PSF Assist private-sector candidates for accreditation (fiduciary, ESS, gender assessments) in developing consistent funding proposals for the GCF Abbreviations: ESS = environmental and social safeguards, NDA = national designated authority, PSF = Private Sector Facility. 25. Other countries expected to engage with and mobilize the private sector are: (i) (ii) 2017: Chile, Montenegro and Tonga; and 2018: Albania, Antigua and Barbuda, Armenia, Bahamas, Barbados, Belize, Colombia, Costa Rica, Dominica, Dominican Republic, Ecuador, Guatemala, Jamaica, Jordan, Kazakhstan, Kyrgyzstan, Kazakhstan, Moldova, Morocco, Namibia, Oman, Paraguay, Republic of Moldova, Tajikistan, Tonga and Uruguay.
Page 3.6 Adaptation planning process 26. A sixth outcome of readiness support enables countries to establish or strengthen their NAPs and/or adaptation planning processes. 34 countries have submitted readiness proposals seeking such support. The Readiness and Preparatory Support Programme has approved support that will yield such results in Liberia, Nepal and Pakistan, with implementation already underway in Liberia and Nepal. Additionally, such support to Antigua and Barbuda and Uruguay has also been endorsed for approval. 27. The following 29 countries are also seeking such support: Argentina, Armenia, Bangladesh, Benin, Bosnia and Herzegovina, Colombia, Costa Rica, Cote d Ivoire, Democratic Republic of the Congo, Dominican Republic, Ecuador, Egypt, Honduras, Kenya, Madagascar, Malawi, Mali, Mauritania, Mongolia, Montenegro, Myanmar, Niger, Serbia, South Sudan, Sudan, Swaziland, United Republic of Tanzania, Uzbekistan and Zimbabwe. Nineteen requests come from least country, and two from small island developing States (SIDS). 28. To accelerate progress towards adaptation planning processes, the Secretariat has undertaken measures to strengthen the quality of submissions and to increase the efficiency of the approval process. Further guidance has been produced and shared with all NDAs and AEs to assist them in designing their adaptation planning proposals. The guidance includes an indicative list of adaptation planning outcomes and outputs and the requirements to build on complementary in-country adaptation planning processes. As an example of adaptation planning support sought from the GCF, box 6 below provides a brief overview of Pakistan s proposal to strengthen its adaptation planning process. Box 6: Objectives of Pakistan in strengthening its adaptation planning process PAKISTAN Strengthen the institutional and technical capacity of the national adaptation planning process Strengthen climate information systems, and the prioritization of adaptation options Establish a funding strategy for the NAP process including its implementation Monitor, review and share knowledge to learn from the NAP process in Pakistan Abbreviation: NAP = national adaptation plan. 29. Additional steps are to be taken by the Secretariat in the remainder of 2017 to further support countries in strengthening the quality of adaptation planning proposals to ensure that they draw on good practices being identified based on proposals submitted to date. These steps include: (a) participating in person or virtually in all regional training provided by the Least Developed Countries Expert Group on NAPs in 2017; (b) direct engagement with numerous NDAs and current and/or potential delivery partners through thematic workshops and bilateral meetings; and (c) deepening the level of detail in guidance provided, including a set of review criteria considerations and indicative admissible activities. With an increase staff capacity, these steps are planned to increase in Q4 2017 and throughout 2018.
Page 13 3.7 Knowledge-sharing and learning strengthened 30. Aside from the grants and technical assistance provided to countries, the Secretariat organizes structured dialogues and events to disseminate and share the knowledge accumulated by countries. The Secretariat has organized five major events since the beginning of 2017 and highlights from the Caribbean and Pacific Structured Dialogues, which represents most of the SIDS, are included in box 7 below. 31. Countries and entities have shared the benefits of being engaged in the regional structured dialogues organized by the Secretariat. So far, the Secretariat has organized four regional structured dialogues which facilitated engagements between NDAs, accredited entities and the Secretariat to build the pipeline for the GCF, and provided opportunities for sharing experiences, leading to furthering the understanding of countries experiences in engaging with the GCF. The first structured dialogues for Asia and the Caribbean, and the first regional workshop in the Eastern Europe and Central Asian countries took place during the second quarter of 2017. The Secretariat is planning a structured dialogue in Latin America at the end of November 2017 in Bogota, Colombia. Box 7: Major outcomes from the first structured dialogue in the Caribbean GCF structured dialogue with the Caribbean 19 22 June 2017, Placencia, Belize 42 potential projects covering 13 countries (USD 1.2 billion in GCF requested resources) were elaborated: o 8 readiness proposals were advanced for submission by delivery partners and NDAs; and o A pipeline of 34 potential projects was identified for further development. 11 CPBs were approved and 4 advanced for submission in 2017. Three regional initiatives were identified for further development, including: o (i) Building a regional platform to manage climate risk; o (ii) Strengthening the capacity of DAEs at the regional level; and o (iii) Mobilizing private-sector engagement in the Caribbean region. Two new national entities expressed interest in seeking GCF accreditation, namely St. Kitts and Nevis Development Bank, and Trinidad and Tobago s Environmental Management Authority Abbreviations: CPB = country programme brief, DAE = direct access entity, NDA = national designated authority, PPF = Project Preparation Facility. 32. The Caribbean Structured Dialogue was held in Placencia, Belize, from 19 to 22 June 2017, with 66 participants representing 13 Caribbean countries, including ministers, NDA representatives, AEs and civil society organizations. The four-day gathering saw Caribbean countries come together to lay out their plans to address climate change in partnership with GCF.
Page 14 Participants learned from the GCF and from each other, and explored areas for regional collaboration. Each country took concrete steps to move their climate priorities forward through intensive interactions with GCF, the AEs and other partners. 33. The dialogue concluded with a roadmap for the region, identifying a prospective pipeline of 42 projects and programmes with estimated GCF investment totalling USD 1.2 billion for a total project value of USD 2.1 billion. The projects and programmes were clustered around the following themes: scaling up energy access and energy efficiency; climate-proofing infrastructure; and increasing resilience in communities, ecosystems and land use. The Structured Dialogue laid the foundations for greater regional cooperation and programmes to address the challenges of climate change in the Caribbean. This was demonstrated through the following three priority regional initiatives identified for further development: (a) building a regional platform to manage climate risk; (b) strengthening the capacity of direct access entities at the regional level; and (c) mobilizing private sector engagement in the Caribbean region. 34. The GCF Structured Dialogue for the Pacific, which took place in Nukualofa, Tonga, from 18 to 21 July 2017, involved 150 participants, representing 13 out of 14 Pacific countries. These participants included members of a high-level ministerial panel, and representatives of the NDAs, AEs and civil society organizations. Given the Pacific s success in accessing GCF resources (seven full funding proposals have been approved for the Pacific to date: six public sector and one private sector) the dialogue focused on lessons learned to date, including those as countries move towards implementation. The dialogue also focused on enhancing the engagement of the private sector. 35. The dialogue concluded by updating the Pacific Road Map, which showcased 24 concepts and funding proposals totalling USD 561 million in its regional pipeline. The priority sectors for the region are: enhanced livelihoods, resilient infrastructure, health and well-being, resilient ecosystems and low-emission energy. The dialogue was also timed to coincide with a half-day workshop for Pacific National Designed Entities for the Climate Technology Centre and Network (CTCN) and the Global Environment Facility Expanded Constituency Workshop for Asia Pacific. 36. The GCF, in implementing the Strategic Plan for the GCF and at the request of several NDAs and direct access entities, is seeking to develop innovative solutions for stakeholders to exchange knowledge. This initiative is inspired by the belief that knowledge exchange by the largest possible number of individuals and entities able and available to offer information, experience, skills and expertise on a voluntary basis, will reinforce the capacities of the NDAs and direct access entities, support access to GCF and help to build a stronger pipeline of projects and programmes. IV. Monitoring of readiness grants 4.1 Portfolio overview and key issues 37. Of the 58 readiness grants that received first tranches of disbursements and are under implementation managed by the Portfolio Management Unit (PMU), 2 have been completed, and 22 have submitted progress reports, with only 19 submitting financial reports. The remaining 28 grants are yet to reach their reporting deadlines. See figure 4 below for an overview.
Page 15 Figure 4: Overview of readiness grants under implementation as at August 2017 58 22 Progress/Portfolio reports 19 Financial reports Note: The figures in the post-disbursement stages are limited to the number of readiness projects implemented under the PMU from March to August 2017. 38. The PMU was established in January 2017. One of its key tasks is to support the Division of Country Programming (DCP) in monitoring a growing number of readiness grants that are implementing activities after receiving first disbursements. Furthermore, PMU is also processing subsequent disbursements based on the review of progress and financial reports. 39. Since it started monitoring readiness grants, PMU has identified issues with 11 readiness grants, including delays in reporting and grant term expiry requiring extensions. Of the four grants whose term had expired, two recipients submitted completion and audited expenditure statements, while two others requested no-cost extensions. Of the seven grants experiencing delays in reporting, six have fulfilled all or part of their past due reporting requirements, and the seventh is in the process of doing so. 40. Under the requirements of the readiness framework agreements, the United Nations Development Programme (UNDP) and the United Nations Environment Programme (UNEP) submitted the first portfolio reports covering 10 readiness grants. One grant was cancelled at the request of the NDA due to the limitation that the implementation modality of the delivery partner posed on waiving procurement procedures. 41. For subsequent disbursements, PMU has processed the second disbursements for two grants totalling USD 184,000. 42. PMU has also been working with and other relevant divisions/offices across the Secretariat to develop and manage procedures for subsequent disbursements, and prepare relevant guidelines for such procedures. 4.2 Remedial measures undertaken to address issues 43. Contractual issues during implementation: Where PMU identified contractual issues, it has worked collaboratively with DCP to contact NDAs, AEs and delivery partners requesting justification for delays and overdue reports and provided them with new due dates and requirements. For four expired grants, the Secretariat requested financial and progress reports to verify the use of proceeds and the progress of the activities. Two of these grants proceeded with subsequent disbursements after the review of the relevant documents, while the other two (which have requested no-cost extensions) received official letters from the Secretariat including specific conditions required for the extensions. 44. Reports received in different formats: The proposals and reporting templates have been evolving during the course of the implementation of the Readiness Programme. As a result, PMU has found it somewhat challenging to review progress and financial reports that are inconsistent across reports and lacking important elements for monitoring, such milestones for activities. PMU has been working with DCP, and where required the Secretariat has also contacted NDAs, AEs and
Page 16 delivery partners, to close information gaps. Furthermore, PMU is collaborating with DCP and other relevant divisions/units to revise templates and develop guidelines for future reporting. 45. Limited capacity: Only one officer has been monitoring the full portfolio of readiness grants under implementation, including corresponding with NDAs/AEs/delivery partners on issues during implementation, reviewing progress/portfolio reports and financial reports, managing database for readiness grants under implementation, processing subsequent disbursements, developing reporting templates, and addressing policy gaps. In order to more effectively monitor a growing portfolio of readiness grants under implementation, PMU has recently recruited a consultant and a Senior Specialist who are expected to join in September 2017. V. Readiness Programme budget 5.1 Programme budget utilization 46. A summary of resources of the Readiness and Preparatory Support Programme, including amounts approved by the Board, resources committed, resources available for execution, and amounts disbursed and spent, is included in table 4 below. Of the total amount of USD 80 million approved by the Board, USD 45.34 million has been committed or spent, leaving USD 34.70 million available for the further execution of the programme. 47. Of the USD 45.34 million, USD 39.48 million has been committed to countries in the form of grants or technical assistance for a total of 3 requests in 88 countries (see annex I for details on the portfolio of approved requests), and an additional USD 5.82 million has been spent on activities such as events (both regionally and targeting direct access entities), on regional consultants advising and supporting countries, and on visits by NDAs to the GCF headquarters. Table 4: Programme budget utilization up to 31 August 2017* (Millions of United States dollars) Items 2014 2015 2016 2017 Total Approved by Board (a) 16.00 14.00 50.00 80.00 Available for execution (b) 16.00 29.60 68.96 50.90 80.00 Requests submitted by countries (c).18 23.74 118.01 153.93 Committed to countries (d) 9.39 15.64 14.45 39.48 Disbursed (e) 0.31 3.09 6.89 10.29 Other expenses or commitments (f) Total committed or spent (g) = (d) + (f) Balance available for commitments (h) = (b) (g) 0.4 1.25 2.37 1.80 5.82 0.4 10.64 18.06 16.24 45.30 15.6 18.96 50.90 34.66 34.70 Notes: (a) includes amounts approved by the Board at B.06, B.08, B.11 and B.15 for execution of the Programme
Page 17 (b) includes amounts approved by the Board plus budget available for execution from the previous year (c) includes requests officially submitted as proposals by national designated authorities (NDAs)/focal points for all activities to date (d) includes resources committed by way of approvals of grants and technical assistance (i.e. PricewaterhouseCoopers support for direct access entities) (e) includes resources disbursed (f) includes other expenses incurred or committed towards the organization of events, hosting NDAs visiting the Secretariat and in-kind support provided by consultants (g) includes all commitments and expenditures (h) balances available for further commitments * All lines are updated to 31 August 2017 except (f), as this is not confirmed from the finance team. The Secretariat has committed USD 0.3 million to develop an online platform to support the NDAs and the direct access entities, which has been added to line (f). 5.2 Budget forecast to close the rest of 2017 48. The Readiness Programme has USD 34.70 million available for further commitments according to the table 4 above. With the remaining readiness proposals from 2017 that need further processing and those projected for submission in the last quarter of 2017, the Secretariat is faced with both a lack of human capacity to operationally process them, and financial resources to further approve and take on additional readiness funding commitments under the current budget allocation. The Secretariat has analysed the current portfolio of those already submitted, and those projected to be submitted, along with proposals that need commitments. The section below explains the analysis conducted and the additional resources required to meet future commitments. Table 5: Q1 Q3 readiness proposals submitted and approved as at August 2017 (number of proposals; USD millions in brackets) NAPs Other readiness proposals Total Q1 Q2 Q3 Total Submitted Approved Submitted Approved Submitted Approved Submitted Approved 7 7 15 29 (20.90) (17.09) (42.78) (80.77) 31 20 31 37 5 99 37 (11.14) 7.16 (11.20) 2.64 (16.15) (0.71) (38.49) (10.51) 38 20 38 52 5 8 37 (32.04) 7.16 (28.29) 2.64 (58.93) (0.71) (119.26) (10.51) Table 6. Projected approvals of those proposals that have been reviewed by the Secretariat (number of approvals; USD millions in brackets) Q3 2017 Q4 2017 NAPs 3 1 (8.90) (2.60) Other readiness proposals 3 15 Events (Latin American Structured Dialogue, Africa Structured Dialogue) Total (1.77) (5.15) (0.30) (0.80) (10.97) (8.50) (19.52) 49. The Secretariat has already reviewed 35 readiness proposals that have been submitted since the beginning of 2017 and that are pending final approval; some of them are expected to materialize into full commitments within the next 1 2 months, as shown on table 6. Thus, of the
Page 18 USD 34.70 million, the Secretariat will be left with USD 15.18 million without processing any other additional readiness proposals. If the Secretariat were to only approve non-adaption planning-oriented readiness proposals, excluding all the adaptation planning proposals submitted and currently under review, it will have USD 26.68 million available. 50. The Secretariat expects to process and approve most of the pending proposals within the next 3 4 months, and therefore with the USD 15.18 million available the Secretariat would exceed the resources available to make further commitments. The Secretariat could approve readiness proposals other than adaptation planning proposals with the remaining resources, but under this scenario none of the adaptation planning proposals could be approved. Table 7 shows the required financial resources if the Secretariat were to review and approve all of the readiness proposals (including adaptation planning) by end of the year. Table 8 presents a more realistic and conservative projection of those in table 7, based on current capacity, indicating the number of requests and associate monetary value that will realistically be reviewed and approved by end of the year. Table 7: Proposals that have been submitted between Q1 and Q3 2017, and need to be reviewed and approved NAPs and/or other adaptation planning processes Number of submissions Amount (USD millions) 25 71.59 Other readiness proposals 31 15.84 Total 56 87.43 Table 8: Estimated approvals of those pending proposals submitted between Q1 and Q3 2017 NAPs and/or other adaptation planning processes Number of submissions Amount (USD millions) 17 43.9 Other readiness proposals 25.0 Total 42 55.9 51. As shown in table 9, from the Q4 submissions, the Secretariat would need to focus mostly on the readiness proposals for non-adaptation planning because of the annual cap, and to defer further approval of adaptation planning proposals submissions until 2018.
Page 19 Table 9: Q4 readiness proposals projections in submissions and approvals (as of 31 August 2017) Activity Strengthening national designated authorities and country programming Support to direct access entities Strategic frameworks Number of requests Submissions Amount (USD millions) Approvals (estimate, USD millions) 16 5.9 4.9 7 0.52 0.21 20 6.15 4.89 Adaptation planning 20 57.5 Total 63 70.07 10 52. In summary, based on the analysis above, the scenarios to close of 2017 (with and without adaptation planning proposals) are as shown in table 10 below, and are consistent with the estimates previously presented at the fifteenth meeting of the Board (B.15) for the 2017 Readiness budget. Table 10: Total budget needed to close 2017 (USD millions) Without national adaptation plans With national adaptation plans Budget approved by Board 80 80 Committed as of 31 August 2017 45.30 45.30 Approvals pending for reviewed proposals 8.02 19.52 Approvals likely for Q1 Q3 submissions pending review 55.9 Approvals likely for Q4 submissions 10 10 2017 closing balance 4.68 50.72 5.3 Budget projections for 2018 53. The Secretariat is also projecting to process 140 proposals by end of 2018, and would need additional resources to be approved by the Board in order to be able to do so. The indicative projections are shown in table 11 below, by activities.
Page 20 Table 11: Indicative projections of readiness requests to be processed in 2018 by type of activity Readiness activities Adaptation planning National designated authority support, including for country programmes Strategic frameworks for GCF programming Support to direct access entities Structured dialogues and other knowledge-sharing activities Number Requests Estimated average value (USD) Total (USD) Projected disbursements 40 2,500,000 100,000,000 30,000,000 40 500,000 20,000,000 10,000,000 20 500,000 10,000,000 7,000,000 20 250,000 5,000,000 3,000,000 10 500,000 5,000,000 5,000,000 Total 130 140,000,000 55,000,000 54. In conclusion, based on the analysis set out above, the Secretariat requests the Board to approve a total budget of USD 190.76 million, of which USD 50.72 million would be to close 2017 and USD 140 million to close 2018. 55. The Secretariat is considering options to continue to strengthen the Readiness and Preparatory Support Programme that could serve as a strategic tool at the very beginning of the project cycle. Objectives may be to further ensure the programme so that it: (a) is truly countrydriven; (b) results in strengthening in-country capacity; (c) is directly focused on the countries specific needs as expressed by the NDA; and (d) is directly aligned with strengthening the quality of project and programme funding proposals. Additional capacity and resources will be required in the last quarter of 2017 and into 2018 for effective implementation, consistent with previous Board decisions on country resource allocation under the Readiness and Preparatory Support Programme.
Page 21 Annex I: Readiness and Preparatory Support portfolio by region as at August 2017 Region Country Results Africa Benin Burkina Faso Cameroon Central African Republic Chad Comoros Congo Delivery Partner Approved amount (USD) 2015 2016 2017 Disbursed (%) Duration (months) UNEP 150,000 24 36,070* PwC 37,000 (completed) - IUCN 300,000 IUCN 300,000 150,000 UNDP 300,000 (50%) 0,000 CSE 300,000 (40%) UNDP 300,000 24 150,000 UNDP 300,000 (50%) 24
Page 22 Region Country Results Africa Côte d'ivoire Democratic Republic of Congo Djibouti Egypt Ethiopia Gabon Gambia Ghana Guinea Delivery Partner Approved amount (USD) 2015 2016 2017 Disbursed (%) Duration (months) CSE 300,000 18 CSE 300,000 CSE 300,000 UNEP 300,000 Ministry of Finance and Economic Planning 300,000 CDC-Gabon 300,000 0,000 (40%) 0,000 (40%) 2,456 (41%) 0,000 (40%) 0,000 (40%) PwC 33,415 - Ministry of Finance and Economic Affairs 300,000 CTCN 300,150 UNDP 300,000 75,000 (25%) 300,150 (100%) 300,000 (100%) 24 18 24 13 24
Page 23 Region Country Results Africa Kenya Liberia Mali Mauritania Mauritius Adaptation planning processes Delivery Partner Kenya National Treasury PwC 37,000 UNDP 300,000 Approved amount (USD) 2015 2016 2017 Disbursed (%) Duration (months) 150,000 UNDP 2,263,467 Sahel Eco 41,165 Sahel Eco 252,000 Ministry of Environment and Sustainable Development (CCPNCC) Ministry of Finance and Economic Development (MoFED) 300,000 34,102* (completed) 150,000 (50%) 804,684 (36%) 41,165 (100%) 100,000 (40%) 0,000 (40%) 300,000-24 24 6 18
Page 24 Region Country Results Africa Morocco Namibia Niger Rwanda Private Sector engaged and mobilized Delivery Partner Approved amount (USD) 2015 2016 2017 Beya Capital 300,000 Disbursed (%) 100,000 (33%) Duration (months) ADA 300,000 24 EIF Namibia 391,009 244,209 (62%) UNEP 300,000 18 Environment and Climate Change Fund 300,000 0,000 (40%)