The GCF has explicitly recognised that “there is a strong need for capacity building” (GCF, 2013). In addition, multilateral and regional funds could facilitate achieving the aid effectiveness principles by providing greater donor co-ordination and reducing risks of fragmentation. National institutions help to identify climate finance needs and prioritise its allocation. The ability and capacity of recipient governments to set a clear vision and strategies for climate change within national plans, to develop policies and programmes to access and absorb international climate funds, and to channel and manage resources, are critical factors in determining the effectiveness of climate finance.