The International Climate Initiative (ICI)

Since 2008, the Federal Ministry for the Environment, Nature Conservation and Nuclear Safety and Building (BMUB) has been financing climate-related projects in developing and newly industrialized countries, as well as transition countries in central and eastern Europe within the framework of the International Climate Initiative (IKI).

Objectives

IKI’s funding priorities are the mitigation of greenhouse gas emissions, adaptation to climate change, the conservation of natural carbon sinks (e.g. through forest protection) and the protection of biological diversity. IKI sees itself as a contribution to international environmental cooperation that complements “classic” development cooperation. However, the BMU also uses the IKI to build strategic alliances with progressive developing countries in connection with the regular world climate conferences on the implementation of the UN Framework Convention on Climate Change (UNFCCC) and the Convention on Biological Diversity (CBD).

Key developments

IKI’s funding portfolio has changed considerably over the years. In addition to the classic implementing organizations such as GIZ and KfW, these also include international organizations, non-governmental organizations and research institutions. In the meantime, the IKI has aligned its funding more strategically and wants to support developing countries in implementing their commitments under the UNFCCC and CBD. In addition, it wants to promote innovative approaches that can generate an impact beyond the individual project or are transferable. Over the years, this has led to larger project volumes and increasingly transnational projects, which, however, has made access more difficult for new and especially smaller organizations. The IKI has countered this by differentiating its funding. There are now several funding lines:

  • Thematic and country specific selection procedures, which fund specific thematic priorities in selected countries through high funding volumes, and
  • Medium and Small Grants, which are more tailored to smaller organizations and projects.

In terms of transparency, the IKI is a pioneer in German climate finance, with comparatively detailed information on funded projects on its website. Since 2016, IKI has published updated information on funded projects every quarter in accordance with the IATI (International Aid Transparency Initiative) standard.

The monitoring and evaluation system has also developed over the years. Since 2015, the IKI has had a standardized monitoring system through which it can also report according to standard indicators (e.g., on the number of tons of CO2 reduced or number of people assisted in climate change adaptation). The summary report of the first project evaluation cycle is publicly available. In May 2017, a second evaluation cycle has started, covering about 425 projects. However, the results are not publicly available yet.

Funding

Originally, the funds for financing the IKI came from the auction proceeds of a small portion of the CO2 certificates in European emissions trading; in the meantime, however, the IKI is an ordinary budget item in the BMU budget. For years, the IKI was endowed with just under 120 million euros annually. In the meantime, it has grown and has a volume of 596 million euros in 2021. (as of July 2021)