By Pete Ogden

At the latest round of UN climate talks in Lima, Peru that concluded yesterday, negotiators representing more than 190 countries lunged and parried their way to an outcome that will guide countries as they scramble to reach a new international climate agreement by December 2015.

But when we look back at this conference in years to come, one of the most notable developments may be something that has received relatively little attention: the announcement by China that it was formally launching a new multilateral south-south climate fund.

This move by China is significant for several reasons. First, it comes in the midst of a drive to capitalize a new fund – the Green Climate Fund (GCF) – that has been in the works for five years, including with China’s direct participation. One of the unique aspects of the GCF is that developed and developing countries collaborated closely on it and that both camps have provided financial support. This mutual engagement was no small accomplishment given the fraught relationship between developed and developing states during climate negotiations.

Many celebrated in Lima last week when the GCF crossed its goal of a $10 billion initial capitalization with the help of some new developing country pledges. But China made clear that it would not be contributing, calling that a job for developed countries. Instead, China drew from the same playbook that it has in advancing the BRICS Bank and the Asian Infrastructure Investment Bank as alternatives to existing international financial institutions: it announced a new multilateral forum where it will have the latitude to write the rules.

The establishment of a South-South climate fund is not a bad thing. To the contrary, we should applaud China’s entry into this space and welcome the reported $80 million over three years with which it is seeding the fund. The world needs all the help it can get in mobilizing resources to assist countries pursuing cleaner economic growth and struggling with the impact of climate change.

But, as with the BRICS Bank or an Asian Infrastructure Investment Bank, the devil will be in the details: what kinds of projects will the fund support? Will China scale the fund into something bigger and more consequential? What does China mean when it describes the new fund as “market-based”? And how will this new fund interact in the larger ecosystem of climate finance? China has been mum on these questions so far. But its initiative merits close attention, particularly by those interested in China’s evolving role in global governance.

Pete Ogden is a Senior Fellow and the Director of International Energy and Climate Policy at the Center for American Progress. He served recently on the White House National Security Staff as director for climate change and environmental policy.