Special Funding Mechanisms
In general, financing for the implementation of the international environmental agreements comes from the treaty parties' own resources. Yet because most developing countries are burdened with huge debts, they usually depend on external funding to help pay for environmental protection measures.
This funding has usually been in the form of Official Development Assistance(ODA). However the average ODA has been decreasing instead of increasing, falling far short of the target of 0.7 percent of the GNP as was adopted by the U.N. in the early 1980s and reaffirmed by the Brundtland Commission and UNCED. 1 On the other hand, the private capital flows have increased, yet even if they are a necessary condition for sustainable development they are not enough because many poor countries are getting very little of this funding, and in addition, sustainable development requires some types of social and environmental investments that do not attract private capital. 2 For this reason, new and additional funding mechanisms are sorely needed to promote developing countries to become parties to the environmental conventions and in turn fulfill their commitments.
Many new funding mechanisms have been suggested to implement Agenda 21, which at the same time would promote the implementation of multilateral environmental treaties at the national and international levels. 3 Several countries have begun to reduce subsidies that promote activities that degrade the environment, and have in place or have begun experimenting with emission trading programs and user fees.
At the international level, a number of innovative mechanisms have been suggested, some of which I will examine in this chapter. The Global Environment Facility (GEF) is widely considered the main financial mechanism to facilitate participation and implementation of the inter-national environmental agreements. The Multilateral Fund of the Montreal Protocol is another such funding mechanism, yet it applies only to the Montreal Protocol, as shown above. 4 Joint implementation activities, as discussed above, 5 could also qualify as special funding mechanisms. In addition,