GCF, KOICA and 10 Other Organizations Approved as New GCF Project Implementation Bodies

[Sejong=Asia Economy Reporter Kim Hyunjung] The Green Climate Fund (GCF) Board held a virtual meeting from the 28th of last month to the 2nd of this month and approved 10 new institutions, including the Korea International Cooperation Agency (KOICA), as new GCF project implementing entities. Along with this, four climate change response projects targeting developing countries, worth a total of $500 million, were approved.

The Ministry of Economy and Finance announced the results of the board meeting on the 4th. The newly approved entities include KOICA, Mitsui Sumitomo Bank, the Development Bank of the Philippines, the Development Bank of Zambia, the Zimbabwe Infrastructure Development Bank, the Moroccan Sustainable Energy Agency, the Vietnam Development Bank, the Mexican Small and Medium Enterprise Development Bank, TBC Bank, and the Inter-American Institute for Cooperation on Agriculture. As a result, the total number of GCF accredited entities has increased to 113.

The GCF designates institutions with project implementation capabilities as accredited entities to develop and manage climate change response projects in developing countries. KOICA has become the second domestic institution, after the Korea Development Bank, to be approved as a GCF accredited entity.

KOICA has supported a total of four climate change response projects, amounting to $560 million, in cooperation with other GCF accredited entities such as the World Bank (WB) and the International Union for Conservation of Nature (IUCN). With this accreditation, KOICA is expected to directly develop Green New Deal overseas projects based on GCF funds and contribute to the overseas expansion of domestic institutions and companies.

At this board meeting, four new projects targeting nine developing countries were approved, with a total GCF support amount of $500 million for greenhouse gas reduction and climate change adaptation projects. These include the construction of a light rail transit system in the metropolitan area of Costa Rica (GCF support of $270 million), financial support to enhance energy access in Africa ($170 million), and climate adaptation support in the eastern region of Rwanda ($33 million), among others.

Through the approval of these projects, a leverage effect is expected with a total investment of $2.95 billion, including co-financing from the Central American Bank for Economic Integration (CABEI) and the African Development Bank (AfDB).

As a result, GCF projects have expanded to a total of 177 projects, with GCF support amounting to $8.9 billion and total project costs of $33.3 billion, benefiting approximately 500 million people in developing countries vulnerable to climate change and expected to reduce a total of 1.8 billion tons of greenhouse gases.

On the 1st, the GCF announced the approval of $1.2 million in project preparation funding for the "Climate Technology Holding Companies Overseas Expansion Support Program," led by the Korea Development Bank, a domestic accredited entity. This project is the first GCF project to foster startup companies through climate technology development and commercialization in developing countries. It supports promising climate technology companies' entry into new southern markets such as Indonesia, the Philippines, Cambodia, and Laos, and aims to establish a $100 million climate fund to activate climate finance.

The GCF highly values the climate technology company development effect of this project and plans to showcase it at the upcoming 26th Conference of the Parties (COP26) to the UN Framework Convention on Climate Change, scheduled for early November, actively supporting the expansion of global private companies' participation in Green New Deal projects.

A Ministry of Economy and Finance official explained, "The Korean government will continue to strive for the sustainable development of the GCF, which has become the world's largest climate change response fund, and plans to actively support the participation of domestic institutions and companies in GCF projects by strengthening linkage with our Green New Deal."

Meanwhile, the next GCF board meeting is scheduled to be held from October 4 to 7.

This content was produced with the assistance of AI translation services.