Climate action in emerging markets will get a boost as a result of the first financing agreement between the United Nations Green Climate Fund (GCF) and the European Investment Bank (EIB). The accord enables the GCF to commit €200 million to a new flagship European Union programme known as the Global Green Bond Initiative (GGBI).
The GCF is investing the sum in the GGBI Fund, a public‑private investment vehicle with a target size of €3 billion, which will be run by Amundi, Europe’s largest asset manager.
The GGBI Fund aims to mobilise as much as €20 billion in private capital for sustainable infrastructure projects in low- and middle-income countries.
“Our partnership with the Green Climate Fund shows how multilateral cooperation can scale up climate action where it is needed most,” said EIB Vice-President Ambroise Fayolle. “Together, we are supporting sustainable growth, resilience and better living standards in low- and middle-income countries.”
“GCF’s €200 million equity investment in the Global Green Bond Initiative will de-risk investments in 10 emerging economies. This equity will stimulate country-led green projects that deliver climate solutions in critical sectors such as energy and transport,” said the Green Climate Fund’s Chief Investment Officer (a.i.) Amer Baig. “The Global Green Bond Initiative is a landmark partnership with the European Commission and European Investment Bank that will enhance country ownership of national climate action and fill critical gaps in climate financing gaps. The partnership supports GCF’s ambition to be the climate partner of choice for developing countries.”
“The creation of the Global Green Bond Initiative Fund, and this first significant commitment from the Green Climate Fund demonstrates that we can build impactful blended finance investment solutions. The GGBI fund aims to mobilise public and private capital to finance climate transition in emerging markets – one of the defining challenges of our time,” commented Valérie Baudson, Chief Executive Officer of Amundi. “Expertise, innovation and collaboration are essential levers to direct capital where it is needed most. We are very proud to be part of this collective initiative.”
The EIB is an accredited entity of the GCF, which is the world’s largest dedicated multilateral climate fund. The financing agreement between the EIB and the GCF demonstrates both organisations’ commitment to multilateral climate action for low- and middle- income countries.
Global Green Bond Initiative (GGBI)
The GGBI is a flagship initiative of the EU’s Global Gateway strategy. It has three complementary pillars:
- The GGBI Fund which mobilises private capital at scale towards sustainable investments in developing countries through green bonds.
- A comprehensive Technical Assistance programme which will share EU expertise and support issuers in partner countries in designing and issuing both green bonds and projects.
- The Green Coupon Subsidy Facility (GCSF) which will help reduce borrowing costs for issuers facing particularly prohibitive interest rates, under specific circumstances.. This will allow partner countries to grow on the green bond market much faster and raise the money they need for their people and their economy.
Global Gateway
Global Gateway is the EU’s strategy to boost smart, clean and secure links in digital, energy and transport, and to strengthen health, education and research systems worldwide. It delivers high quality investments that meet the highest environmental, social and governance standards, ensuring sustainability and transparency for partners, people and the planet.