PARIS, Dec. 8, 2015 /PRNewswire/ -- The Global Green Growth Institute (GGGI), an intergovernmental organization founded to support and promote green growth, held a high-level panel discussion today at COP21 in Paris featuring senior government representatives from three GGGI member countries (Costa Rica, Ethiopia, and the Philippines) to look at national and international barriers to financing green projects, and steps to overcome them.
The session, moderated by GGGI Assistant Director-General and Head of the Knowledge Solutions Division Mahua Acharya, examined how national and international financial institutions and project development are related, focusing on the role that domestic financial institutions play in project development and leveraging international finance, with a view to both public and private sources of finance.
In the opening statement, Yvo de Boer, Director-General of GGGI and former Executive Secretary of the UNFCCC, presented GGGI's vision for promoting and facilitating green investments, looking at the linkages among international and domestic sources of finance as well as bankable project pipeline development.
"We know the world is awash with money. We are not short of capital at a global level," said Yvo de Boer. "The conviction of GGGI is to promote ambition by calling for action, and in order to enhance action we are going to need finance."
The panel also outlined the three essential steps for securing green finance: 1) innovative international finance; 2) national instruments; and 3) bankable projects. (See below for additional details on the "The Three Steps to Green Finance".)
The senior representatives from GGGI member countries also highlighted their country's strategy for mobilizing green finance to implement the programs and projects that reflect and are in line with their respective visions of green growth.
The participants in the panel discussion included:
- H.E. Dr. Edgar Gutierrez-Espeleta, Minister of Environment and Energy, Costa Rica
- Mr. Admasu Nebebe, Head of CRGE Facility, and Director of UN Agencies & Regional Economic Cooperation Directorate- Ministry of Finance and Economic Cooperation, Ethiopia
- Ms Joycelin Goco, Assistant Secretary, Climate Change Commission, the Philippines
This panel, hosted by the Green Investment Service (GIS) of GGGI, also underscored the service offerings of GIS and the GGGI's in-country activities to unlock the potential of finance for green growth-related projects and programs.
GGGI's Three Steps to Green Finance:
Step 1: Innovative international finance
Facilitating greater access to private capital, multilateral grant, equity, and guarantees as well as climate finance investments for green green/climate change in emerging markets has been a longstanding area of work for GGGI. There are a multitude of planned and implemented innovative international finance instruments available, each with a different emphasis and focus and different modalities and procedures for accessing them. GGGI offers member countries the opportunity to appropriately access these funds, tailoring countries submissions to best fit the opportunities that match their needs and priorities.
Step 2: National instruments
National instruments can be deployed either unilaterally or in order to channel funding from Innovative international finance. For example National Climate Funds are becoming an increasingly popular mechanism that supports countries to manage their engagement with climate finance by facilitating the collection, blending, coordination of, programming and accounting for climate finance. The funds can blend various resources (both national and international) and include mechanisms for attracting international financing (either through direct access or other intermediaries) Financial regulations and policies can be shaped to create an investment-friendly environment for green growth, and financial and non-financial policy instruments can be deployed to address barriers and risks
Examples of areas where GGGI and its staff have experience and in many cases are engaged include
- Pay for performance REDD+ mechanisms such as the Amazon vision fund in Colombia
- Nationally coordinated resilience funds blending national and international finance such as the People's Survival Fund
- Internationally funded infrastructure funds that blend public and private finance such as as the CRGE in Ethiopia
- Emissions trading and offsetting systems and how these can interlink with facilities such as the World Bank Methane purchase facility
- Carbon taxes and how these can be hybridized by use of nationally based offset programs that expand the financial flows associated with carbon taxes in to economic sectors not covered by the tax, bringing economy wide benefits.
Step 3: Bankable Projects
Enhanced access to international finance coupled with the policies and tools outlined in steps 1 & 2 can be brought together to facilitate access to finance for bankable projects. Measures designed to overcome incremental costs include NAMAs, feed in tariffs, carbon instruments, concessional loans and grants, plus risk management approaches such as structured funds and tranched investment. Overcoming critical issues such as real and perceived risk, untested rates of return, lack of demonstrable success stories, limited experience in developing countries, and an unfavorable policy environment can produce project investment on the ground.
About the Global Green Growth Institute (GGGI):
Based in Seoul, GGGI is an intergovernmental organization founded to support and promote a model of economic growth known as "green growth", which targets key aspects of economic performance such a poverty reduction, job creation, social inclusion, and environmental sustainability. The organization partners with countries and multilateral institutions to help build economies that grow strongly and are more efficient and sustainable in the use of natural resources, less carbon intensive, and more resilient to climate change.
GGGI works with countries around the world, building their capacity and working collaboratively on green growth policies that can impact the lives of millions, and has representation in a number of partner countries, including:
Member Countries: Australia, Cambodia, Costa Rica, Denmark, Ethiopia, Fiji, Guyana, Indonesia, Jordan, Kiribati, Republic of Korea, Mexico, Mongolia, Norway, Papua New Guinea, Paraguay, Philippines, Qatar, Rwanda, Senegal, United Arab Emirates, United Kingdom, Vanuatu, Vietnam
Operations: Cambodia, China, Colombia, Ethiopia, Fiji, India, Indonesia, Jordan, Mexico, Mongolia, Morocco, Nepal, Peru, Philippines, Rwanda, Senegal, South Africa, Thailand, Uganda, United Arab Emirates, Vanuatu, Vietnam
SOURCE Global Green Growth Institute