The fact that pollution of the environment could take place with impunity was one of the most manifest international market failures, Minister in the Presidency responsible for the National Planning Commission (NPC) Trevor Manuel said on Friday.

Speaking following his appointment as one of three co-chairs on the transitional committee responsible for designing the Green Climate Fund, the Minister acknowledged that capitalising the fund would require “a lot of moral suasion” to convince developed countries to contribute.

The Green Climate Fund was a mechanism agreed to at the United Nations Framework Convention on Climate Change’s (UNFCCC’s) Cancun 2010 conference, which would seek to mobilise funds from industrialised countries to be dispersed among poorer developing nations for climate mitigation and adaptation projects.

While many countries understood their responsibility to contribute - owing to historical emissions, blamed for rapid climate change, which are likely to be experienced more harshly by least developed countries – Manuel said there was still reticence in actually handing over the money.

The transitional committee would be tasked with designing the governance arrangements of the fund, mobilising resources and establishing the modalities of spending the resources within the fund. For the first three years of operation, the World Bank would be the trustee of the fund.

Filling the fund, Manuel added, would also likely rely on ensuring that there was a transparent pricing of carbon emissions.

When questioned on whether South Africa was likely to be a net contributor, or a net beneficiary, Manuel said that South Africa, and other larger emerging economies, were likely to be neutral participants, as long as they met their domestic obligations.

He added that it was hoped that the fund would be established by December, when the world gathered in Durban for the 17th Conference of the parties (COP17), thus allowing COP17 to progress beyond financial matters.

Speaking from Cape Town, Manuel said that he was meant to be at the meeting currently taking place in Mexico City, but UNFCCC executive secretary Christina Figueres had contacted him to let him know that he had been elected as a co-chair to the transitional committee in absentia.

Manuel participated in teleconferences on Friday, during which the schedule for further meetings was discussed along with the anticipated key milestones ahead of the Durban gathering. The committee was likely to have at least four meetings before November, and these would likely ‘piggyback’ on scheduled meetings of UNFCCC negotiators.

The Green Climate Fund was first mentioned at COP15 in Copenhagen in 2009, however at Cancun in 2010 it was decided that it would need to be operationalised by the time of COP17 in Durban.

The fund was expected to generate $100-billion a year for climate financing by 2020, as well as “fast-start finance” of $30-billion for use between 2010 and 2012. What would happen during the gap from 2013 to 2020 would also need to be clarified.

Manuel said that the transitional committee saw the establishment of this fund as a “feasible but challenging” task.

Manuel was also appointed to the board of the Global Green Growth Institute (GGGI), chaired by former Korea Prime Minister Han Seung-soo, and co-chaired by London School of Economics Professor Lord Nicholas Stern, and Standford University Professor Thomas Heller.

The GGGI would conduct research into climate change and advise countries and companies on policies to adapt to and combat rapid climate change.

Manuel said that there were many parallels between the work on the fund and the work being done by South Africa’s NPC, with particular reference to President Jacob Zuma’s strong commitment that South Africa’s emissions “peak, plateau and reduce“.