ALIDE to implement GCF “readiness” project to boost climate finance in six Latin American countries
- The agreement signed between the Association and Unops —institution manager of the funds on behalf of the GCF— officially marked the project’s launching.
- The ministerial departments responsible for environmental and climate policy of Argentina, Cuba, the Dominican Republic, Guatemala, Paraguay and Uruguay are participating in this initiative in representation of their governments.
May 12, 2021- The Latin American Association of Development Financing Institutions (ALIDE) will act as “delivery partner” of a Green Climate Fund (GCF) “readiness” project to boost climate finance in six Latin American countries. The agreement signed recently between the Association and the United Nations Office for Project Services (Unops) –the funds management institution— officially marks the launching of this initiative.
Known as “Enhancing Climate Finance and Investment in LAC Banking Sector,” the project seeks to increase climate finance in financial institutions of Argentina, Cuba, the Dominican Republic, Guatemala, Paraguay and Uruguay. The proposal intends to turn the banks’ individual efforts into coordinated regional financial sector initiatives and, in that way, to increase the number of institutions accredited in GCF and the projects, in line with the countries’ climate policies and frameworks.
The agreement officially marking the launching of the project was signed by Gurel Gurkan, Head of Unops Support Services, and Edgardo Alvarez, ALIDE Secretary General, after its approval by the GCF Secretariat. Under this agreement, the Association will receive financing over an 18-month period for different activities that will contribute to the project aim.
Participating in this multilateral initiative, in addition to the international organizations, are senior officials of the beneficiary countries, whose involvement will make direct and coordinated work with the governments possible. In that way, ministers, vice-ministers and directors of government departments responsible for environmental and climate policy of Argentina, Cuba, the Dominican Republic, Guatemala, Paraguay and Uruguay will be participants.
On the project
The development finance institutions of Latin America have responded proactively to the challenge created by climate change, by incorporating an element of sustainability into their products and services. Even so, those individual initiatives are unable to produce significant national or regional results in terms of the climate. What is lacking is a regional approach to climate finance, that would identify barriers and opportunities and lead to a sharing of experiences and of mechanisms for impact monitoring and follow-up.
In that context, the group of six Latin American countries decided to collaborate with ALIDE in developing a GCF project. The result of the joint effort is the proposal “Enhancing Climate Finance and Investment in LAC Banking Sector,” which seeks to boost climate finance through three main lines of action.
In the first place, the project seeks to assist financial institutions and national finance platforms with their accreditation and access to GCF funds. Also, to step up the institutions’ participation in implementing National Determined Contributions (NDCs) and the Country Program, as well as to promote joint investments and strategic alliances between financial institutions and accredited entities by means of mechanisms to facilitate climate investment to scale in Latin America.
GCF Climate vision
Born of the historic Paris Agreement, the GCF is the world’s largest climate fund. It is mandated to help developing countries collect and materialize their NDC ambitions for low emission and climate resilient routes. The institution recognizes the importance of promoting green financial systems with which to address climate change. It has a comprehensive vision for ecologizing the financial system on three levels: capacity, market and policy.
The GCF has collaborated and participated from the very beginning in carrying out a variety of activities with ALIDE, like organizing workshops, sharing experiences and creating knowledge. The launch of the new ALIDE-GCF climate finance project responds to those cooperative relations and to their institutional aims.
ALIDE is the community of financial institutions that generates banking solutions for the development of Latin America and the Caribbean. Founded in 1968, its main objective is to contribute to the economic and social development of the region, through the good practices in development financing that it promotes among its associates, about 90 institutions with a presence in more than 20 Latin American countries and other regions of the world.