The Green Climate Fund (GCF), unveiled as part of the Paris Agreement in 2015, was designed as a lynchpin for global climate solidarity between rich and developing countries. Despite its laudable ambitions, the Fund faces important challenges and criticism. It has struggled to define its role in an increasingly crowded climate finance landscape and is seen as slow and difficult to work with, especially for the most vulnerable countries. The GCF is also not effectively targeting its funds towards countries with the greatest needs.

The GCF is due for replenishment and is calling on donors to provide ambitious pledges to enable a scale-up in its financing. Donors must decide how to prioritise the GCF within an evolving global climate finance architecture. This question is especially pertinent for Australia, which stopped supporting the GCF in 2019 and remains one of the few major donors outside the Fund.

Australia should rejoin the GCF to rebuild its global climate credentials in its bid to host COP31 and to further its strategic climate objectives in the Pacific Islands region. The GCF remains central to realising global climate solidarity and worth major donors investing their time and resources to boost its allocations and improve its operations.

Several key reforms will be necessary, however, if the GCF is to deliver on its full potential. The Fund should focus more squarely on meeting the needs and priorities of the most climate vulnerable countries relative to other climate finance providers that target mitigation efforts in higher-emitting developing countries. To deliver on this, the GCF must develop clearer mechanisms for ensuring its support goes to where the adaptation needs are greatest. It should also greatly enhance the ability of vulnerable countries to directly access its financing, especially through more ambitious efforts to cut red tape and shift towards sustained programs of support rather than one-off projects.