Discussions regarding the design of the Green Climate Fund (GCF), which would disburse $100-billion a year for climate financing among developing countries by 2020, deadlocked this week as countries were unable to agree to the design of the fund, the International Institute for Environment and Development (IIED) said.

The disagreement flowed from a meeting of an international committee tasked with designing the fund in time for governments to approve it at next month’s United Nations (UN) Framework Convention on Climate Change seventeeth Conference of the Parties, COP 17, in Durban.

South African National Planning Commission Minister Trevor Manuel, who co-chaired the meeting, described the outcome as "sub-optimal".

The least developed countries (LDCs), 48 of the poorest nations in Africa and Asia that are particularly vulnerable to climate change, were represented on the committee by Bangladesh and Zambia, whose negotiators have called from the outset for a radically new approach.

The IIED said developing countries have warned that control of the fund by the donor nations and the burden of bureaucracy that it entailed would limit their ability to make good use of it.

The institute argued that national climate-change trust funds in developing nations should be able to directly access the GCF, rather than going through a third party such as the World Bank, which entailed long delays and excessive paperwork.

“Direct access would empower the recipients of support to take their destiny into their own hands, without having to have their plans and projects approved by external entities,” says the IIED’s Dr Saleemul Huq.

Pa Ousman Jarju, chairperson of the LDC negotiating block at the UN climate change talks, said direct access would allow more devolved decision-making to reflect local and national concerns, and it would enable countries to integrate the funding into their national plans and strategies for dealing with climate change.

“Without direct access, poor countries will struggle to adapt to climate change as they would face immense delays to access the funding and would not have the freedom to decide how and when to spend the money,” he added.

After six months of tense negotiations, the LDC bloc seemed to have succeeded in their demand for provisions for direct access to be included in the final text, the institute said.

But in the committee’s final meeting on October 18, the US and Saudi Arabia withdrew their support for the overall design supported by all other countries because of concerns about other aspects of the text.

Germany expressed frustration and disappointment, and said that the committee’s failure to agree a design “will likely result in not having the GCF this year or the next”.

Developed countries agreed to set up the GCF at COP 16 in Cancun last year.