The Green Climate Fund (GCF) has committed $240 million to the Infrastructure Climate Resilient Funds (ICRF). Launched by the Africa Finance Corporation (AFC), this facility aims to finance climate-resilient infrastructure in Africa.
The 35th meeting of the Green Climate Fund (GCF) Board of Directors ended in South Korea with good news for Africa. The United Nations (UN) financial mechanism has pledged $240 million to theInfrastructure Climate Resilient Funds (ICRF). This financing mechanism launched in September 2021 aims to finance climate-resilient infrastructure in Africa.
This $240 million investment is the first commitment by the GCF to a large-scale multi-country programme. The ICRF is targeting a capitalisation of $750 million for climate resilient infrastructure financing. The fund, managed by AFC Capital Partners, will support the incremental cost of integrating climate adaptation and resilience measures into climate protection infrastructure, thereby reducing the risk of commercial institutional investors participating in the mobilisation of large-scale finance.
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The GCF is accompanying its investment with a grant of $13.7 million. It thus becomes the first financial institution to accompany the establishment of the ICRF. “The GCF’s anchor investment in the ICRF will mobilise African pension funds and other private investors to invest in climate resilient infrastructure as a new asset class in Africa. It will also serve as a model for local banks and financial institutions to engage in climate finance,” says Yannick Glemarec, GCF Executive Director.
Over the next few years, the ICRF will target institutional investors, including African pension funds, sovereign wealth funds and insurance companies. The funds raised will finance new and existing infrastructure that is planned, designed, built and operated to anticipate, prepare for and adapt to the continent’s changing climate conditions. The ICRF will make these investments alongside the AFC.
Jean Marie Takouleu