World's biggest climate fund ramps up investment plans, World News
The Green Climate Fund's (GCF) plan to release about US$1.2 billion (S$1.5 billion) for 17 projects mostly in Asia and Africa follows approval by shareholders including the United States at a meeting this week, against a fractious political backdrop that has seen development aid slashed.
Official development assistance could fall 17 per cent this year after a 9 per cent drop in 2024, the Organisation for Economic Cooperation and Development (OECD) said in a June report, led by hefty cuts to US aid by President Donald Trump.
"At a time when collective climate action is more needed than ever, GCF is stepping up to deliver on its mandate," GCF Co-Chair Seyni Nafo said in a statement.
The GCF disbursement includes $227 million for an initiative to expand green bond markets in 10 countries. Green bond markets are where companies raise capital for projects that limit climate change or otherwise benefit the environment.
In South Asia, it will invest $200 million in the India Green Finance Facility to scale renewables and energy efficiency, while in East Africa it will invest $150 million in the food system to support nearly 18 million people.
All the projects will bring the GCF investment portfolio to $18 billion across 133 countries. So far, countries have pledged $29.9 billion to the GCF and paid in $21 billion.
As well as releasing more money, the GCF board also approved plans to speed up its work with partner organisations, which can include accredited entities like other multilateral lenders and so-called Direct Access Entities (DAE) in developing countries.
From an average 30 months to accredit a DAE, the aim is to shorten the time to nine months or less by overhauling its procedures, including carrying out much of the due diligence at the project stage.
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