Climate funding unprecedented opportunity for corruption, warns Transparency

Climate funding presents unprecedented opportunities for corruption as large sums of money flow through new channels from donor nations, Transparency Maldives (TM) has warned.

Over US$130 billion in worldwide funding for climate change adaption and mitigation projects is predicted to flow into the highly complex aid sector, said TM Project Coordinator Maurifa Hassan, during the local launch of Transparency International’s Global Corruption Report focusing on climate change.

“Those most affected by climate change are those most marginalised,” said Hassan during the launch at Traders Hotel. “Rules of engagement” set by donor nations were “diverse and complicated”, and directing funding to where it was needed most would require strengthening transparency and governance practices.

Already, she said, “where carbon markets have been introduced, the rules tend to be set by the market leaders.”

Speaking at the launch, Finance Minister Ahmed Inaz emphasised the importance of ensuring aid investment and expenditure was transparent.

“Many islands require immediate and expensive engineering,” he said. “Adaption is costly, and sea walls do not come cheap. Male’s sea wall cost US$17 million, and without the support of Japan we would not have been able to build it.”

Investment in renewable energy was also central to the country breaking its addiction to imported oil, he noted.

“However, large amounts of international funds have gone into reports produced by foreign consultants, which then sit on the shelves in various ministries,” Inaz said. “That is also a form of corruption – the money is not going where it is needed.”

‘Climate Champion’ Hamza Khaleel from the Commonwealth’s Youth Program observed that accountability for funding among local bodies was “almost non-existent.”

“The people are the eventual victims of half-finished projects, and this can have a real impact on democracy,” he said.

“The government must lead by example, as the private sector takes its lead from the government.”

Transparency International’s report on climate finance corruption emphasised “better governance” as the solution, and said that “it will be crucial to ensure that the mitigation strategies and adaptation solutions that emerge at local, national and international levels embrace participation, accountability and integrity.”

“Left unchallenged, corruption ruins lives, destroys livelihoods and thwarts attempts at social and economic justice. The same risks apply to climate change,” the report said.