Executive Director of Green Climate Fund (GCF), Yannick Glemarec, says the climate portfolio of the Fund grew by 40% this 2021, adding $2.9 billion in new climate finance.
‘’Our portfolio now totals $10 billion in GCF resources, amounting to $37 billion in climate assets under management’’, he said in a thank you message to the Fund’s partners.
GCF was created to support the efforts of developing countries in responding to the challenge of climate change.
The rest of the message goes thus: ‘’2021 was a year when the world needed GCF more than ever, and I am proud that we have risen to the challenge, just when it has been critical for us to do so. Our role is not just to channel climate finance to developing countries, but to do so in a way that drives a paradigm shift towards low-emission, climate-resilient development. For that we need scale, we need efficient delivery, and most of all, we need a transformational approach. On all these measures, I am proud to say that GCF has delivered this year.
‘’These funds are spread across 190 projects and programmes, equally targeting adaptation and mitigation action. And almost two-thirds of our adaptation funding goes to the most vulnerable countries: Least Developed Countries, Small Island Developing States, and African states.
‘’Alongside this huge volume of new climate finance, we have also been able to speed up our delivery to developing countries. GCF has now disbursed a cumulative $2.3 billion for adaptation and mitigation action in developing countries, exceeding our target for the year, and increasing the total disbursements made over the lifetime of GCF by 64% since the end of 2020.
‘’We are also reducing the time taken between project approvals by our Board and the disbursement of funds on the ground. Thanks to greater operational efficiencies, we have halved the average time taken between these two milestones, from an average of 15-19 months in 2018, down to 7-10 months for projects approved in 2021.
‘’More programming and more rapid delivery of resources are essential, but that alone is not enough to drive the paradigm shift we need. GCF has a clear, four-pronged strategy to drive such a transformation, and we have further refined our approach this year to deliver real change.
‘’First, we are helping nurture a supportive climate regulatory environment and public support in developing countries. In response to the COVID-19 economic shock, we have leveraged our capacity-building Readiness programme to support developing countries’ efforts to craft climate-compatible economic stimulus measures and explore innovative financing instruments to finance them without increasing their debt burden.
‘’Second, GCF’s investments are also accelerating innovation, providing early-stage financing to climate innovators to pilot new climate solutions. One example this year is our new $279 million investment in the Amazon Bioeconomy Fund to support new bio-businesses across six Latin American countries to reduce emissions and enhance climate resilience.
‘’Third, we are de-risking the first deployment of new climate solutions at scale. As part of our efforts to make blended finance work better for the most vulnerable, for adaptation and for ecosystem-based approaches, our Board approved the Global Fund for Coral Reefs this year.
‘’This $500 million blended finance vehicle will leverage up to $3 billion in private investment for coral reef conservation and restoration in developing countries. It will offer critical risk equity capital, debt swap schemes, and grant funding to deliver exciting and impactful coral reef projects.
‘’And finally, we are strengthening domestic financial institutions to support the widespread adoption of commercially proven new climate solutions in developing countries. In 2021 we have worked with Jamaica to establish the first Caribbean exchange for green bonds to finance net-zero, climate-resilient infrastructure in the Caribbean region.
‘’As we prepare to mark the end of 2021 and enter a New Year, I would send my sincere thanks to all our partners for your contributions this year to the fight against climate change. The Green Climate Fund is a partnership organisation, and we can only achieve our ambitious mandate with the support of all our partners, including Accredited Entities, delivery partners, Civil Society Organisations, and of course our developing country partners.
‘’The momentum around COP26 last month has kept opened our window of opportunity to avoid the worst impacts of climate change. I hope that this year has also delivered a sobering realisation that there is no further time to lose to reach the ambitions of the Paris Agreement. If the increasingly ominous scientific reports were not enough, in 2021 we have also witnessed a series of devastating extreme weather events that risk becoming increasingly common in the years to come.
‘’It may be difficult to remain optimistic in the face of these signs of climate breakdown, coupled with another wave of COVID-19. But we know that the societal transformation we need for our climate can also deliver inclusive economic recovery from the pandemic. The solution is the same. A climate-resilient recovery must be our top priority for 2022.’’
