, taking into consideration the country’s absorption capacity. Such estimates are needed not only to properly integrate spending on adaptation into wider development programs but also as a basis for mobilizing financing. Bangladesh’s Climate Fiscal Framework (CFF, Finance Division, June, 2014) is an attempt to make public finance systems ready for utilizing domestic and international climate financing in the most efficient and effective manner. Finalizing and implementing the CFF will ensure efficiency in distributing climate funds to relevant sectors. The framework
Financing Facility (CFF). Stand-alone CFF access requires that the balance of payments situation be satisfactory apart from the export shortfall. Because of the difficulty in making this assessment in the absence of a program that addresses the appropriate adjustment/financing mix, and the inability of most members to meet this standard, the CFF has been little used in recent years. Moreover, CFF financing is not on concessional terms and it does not cover all exogenous shocks faced by low-income countries. In contrast, a PRGF window could offer financing on concessional
the ESAF into the PRGF, the purpose of the PRGF is to provide “loans on concessional terms ... to low-income developing members ... in order to support programs to strengthen substantially and in a sustainable manner their balance of payments position and to foster durable growth, leading to higher living standards and a reduction of poverty.” 26 21. Compensatory Financing Facility (CFF) . Financing under the CFF is available to eligible members that are temporarily experiencing a decrease in export earnings or an excess in cereal import costs. Members must have
of payments problems, the adjustment required under a stand-by arrangement can be minimal. 21. Financing under the CFF does not count toward the access limits in the credit tranches and under the EFF, and hence CFF financing could, in principle, augment total resources available to members . However, in practice, this floating aspect of the CFF has not been used to alleviate the constraint, since access in the credit tranches under stand-by arrangements and under extended arrangements rarely has been close to the access limits. Out of 127 Fund arrangements that