Carrots without Sticks? New Financial Mechanisms for Global Environmental Agreements.

This critique has been leveled exclusively- and massively - at the GEF, largely because of its close association with the World Bank, which is still a favourite global villain for opin- ion-leaders in the environmental NGO community and the Third World.71 Suspicions of donor-domination remain, even though many of the early objections against the alleged "undemocratic", closed and top- down style of decision-making in the GEF pilot phase were at least partly met and remedied by its post-Rio re-structuring. After a series of intergovernmental meetings and interagency contacts in 1989-1990, the World Bank's Board of Executive Directors in March 1991 established the Global Environment Facility (GEF),z9 which according to its enabling instrument should "support pro- grammes and activities for which benefits would accrue to the world at large while the country undertaking the measures would bear the cost, z3 In 1992, the Conference of the Parties to the Montreal Protocol adopted an "indicative list of categories of incremental costs", ILM 32 (1993), 874 et seq. 92 Without the promise of financial aid for their participation, however, the countries of the South, China and India in particular, "would not have signed up to the Montreal Protocol, thereby undermining the ozone regime's global reach,"93 and Without the prospect of losing their GEF funding, the countries of Eastern Europe and the former Soviet Union would simply continue their lucrative free-riding production of ozone-depleting substances.94 In the face of this dilemma, the granting of "selective incentives"95 to these reluctant parties has been justified by tional Regimes", European Journal of International Relations 1 (1995), 267 et seq., (283). [Extracted from the article]

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