Name of Fund

The Government of Norway's International Climate and Forest Initiative (NICFI)

Official Fund Website

http://www.regjeringen.no/en/dep/md/Selected-topics/climate/the-government-of-norways-international-.html?id=548491

Date Created

Date fund proposed: December 2007

Date fund made operational: 2008

Proposed Life of Fund

Indefinite

Objectives

The NICFI aims to:

1.    Work towards the inclusion of emissions from deforestation and forest degradation in a new international climate regime.

• A key focus is to contribute to the development of a credible system for monitoring, assessment, reporting and verification.
  

2.    Take early action to achieve cost-effective and verifiable reductions in greenhouse gas emissions.

• In the preliminary phase, it is likely to focus on capacity building, where progress is measured against milestones for the capacity building process and not against emission reductions results which cannot reasonably be expected in the immediate term.
  

3.    Promote the conservation of natural forests to maintain carbon storage capacity.

Activities Supported

The NICFI supports activities that strengthen international cooperation on REDD. It focuses on the development of international finance and support systems through close cooperation with multilateral organisations.  Specifically, the NICFI works to establish:

• Credible systems for monitoring, reporting and verification (MRV) of emissions reductions from deforestation and forest degradation, at national levels in partner countries, and at the international level.
  
• Robust, effective and flexible international architecture to advance efforts in reducing deforestation and forest degradation.

Conditions & Eligibility Requirements

Multilateral Channels
The majority of NICFI’s activities are conducted through multilateral channels including the:

• Congo Basin Forest Fund
  
  
• Forest Carbon Partnership Facility (FCPF)
  
  • Continued contributions to FCPF is dependent on the
    
    • degree of complementarity with UN efforts;
    • level of interest from relevant recipient countries; and
    • clarity of focus on  transformational change and results-based approaches to REDD.
      

• Forest Investment Program (FIP)
  Continued contributions to FIP is dependent on the
  
  • degree of complementarity with UN efforts;
  • level of interest from relevant recipient countries; and
  • clarity of focus on transformational change and results-based approaches to REDD.

• Guyana’s REDD+ Investment Fund (GRIF)
  
  
• UN REDD Programme (UN-REDD)
  
  • Currently one of the main ICFI channels but contributions in later phases will be limited to fewer countries.

 Eligibility of projects is subject to each initiatives project selection criteria.

Bilateral Channels
NICFI activities are only conducted through bilateral channels in countries where multilateral initiatives and/or multi-donor cooperation already exist.  This ensures that recipient countries possess the necessary capacity for the uptake of projects.   However, exceptions are made for:

• Countries that have already made such extensive progress at the national level that performance-based support for the implementation of an established strategy can be immediately provided; and
• Countries with which Norway has long, broad-based experience of cooperation on natural resource management, and which have already started internationally supported REDD programmes. 

Generally continued funding from the NICFI is dependent on performance of the bilateral initiatives.  

Access to Funding

Funding will primarily be provided through the above mentioned established multilateral channels, with certain exceptions for bilateral partnerships.

 The Norwegian Agency for Development Cooperation (NORAD) contracted a team of independent evaluators from the British company LTS  International in collaboration with Indufor Oy, Ecometrica and Christian Michelsen Institute to provide real-time evaluation services to NICFI between 2010 and 2013. The approach involves a range of evaluation activities to be periodically repeated during the life of the Initiative, as well as stand-alone evaluations of specific thematic or geographic areas. This is the largest evaluation ever attempted by the NORAD Evaluation Department and is the first time that a Real-Time evaluation approach has been used for development cooperation. It allows the NICFI to draw early lessons and allow corrections to be made in ‘real time’ and covers:

• management and administration in Norway

• multilateral, bilateral and nongovernmental agencies funded by the Initiative

• international negotiations and related global and regional policy processes

• national REDD processes, plans and actions

 The evaluations comprise desk studies and field work in selected countries as well as validation and feedback workshops. They provide both  documentation and learning functions. The concerned partners will therefore be actively consulted during the evaluation process, also on issues related to the terms of reference and timing of the different evaluation activities.

 Evaluation reports will be publicly available. As of April 2014 ‘real time’ evaluations have been undertaken for:

·         NICFI’s Contributions to a Global REDD+ Regime 2007-2010

 And at national level in:

·         Brazil

·         Indonesia

·         Democratic Republic of Congo

·         Guyana

·         Tanzania

Decision Making Structure

A project group in the Ministry of the Environment, Department for Pollution Control, Section for Climate and Energy, has been appointed to implement the NICFI. The group cooperates closely with the Ministry of Foreign Affairs and other relevant ministries, and draws on climate- and forest-related expertise from multilateral organizations, NGOs and research institutions. A broad-based inter-ministerial coordinating group of approximately 12 members has also been appointed.

Although the Ministry of Environment maintains overall responsibility for the NICFI, Norway's Ministry of Foreign Affairs is responsible for managing and disbursing funds. Additionally, NORAD manages funds for civil society support and scientific institutions.

Non-Government Stakeholder Participation

A key component of NICFI's funding portfolio is the Civil Society Support Fund, which supports civil society input to climate change negotiations and REDD+ activities. In 2010, this Civil Society Support Fund received USD$27 million to generate and disseminate scientific knowledge, strengthen civil society's ownership of REDD+, promote informed debate on REDD+, and enhance capacity for stakeholder participation within REDD+.

Information Disclosure

The Norwegian Government, and by extension, the NICFI, report regularly to the United Nations Framework Convention on Climate Change (UNFCCC).

Safeguard Policies

The Government of Norway has been an outspoken proponent for environmental and social safeguards in REDD+, particularly in the case of indigenous rights. The NICFI co-chaired the design process of the Forest Investment Programme (FIP). However, some CSO observers are concerned about a lack of clarity from the NICFI over exactly what form its safeguards should take.

Issues Raised

According to a 2010 independent evaluation by LTS International, media and public response to the NICFI has been positive. However, questions were raised about the coherence of various aspects of Norwegian finance.

Inclusion as Official Development Assistance?

Yes.

Financial Instrument/ Delivery Mechanism Used (e.g. grant, loan)

The NICFI is primarily grant-based (although some funding may be disbursed as loans e.g. funds channelled to the FIP)

Nature of Recipient Country Involvement

Country partnerships under NICFI are viewed as opportunities to demonstrate that genuine north-south climate change partnerships based on mutual commitments, mutual trust and constructive dialogue are possible.