NDF - Financing for climate change and development projects

Enhancing Readiness of ADB Developing Member Countries for Scaled Up Finance [NDF C89]

Hanoi, Vietnam. Photo: Judith Scharnowski, Creative Commons.
Hanoi, Vietnam. Photo: Judith Scharnowski, Creative Commons.
6.06.2016
The project aims to help build the capacity of ADB developing member countries to access critical financing for scaling up climate change actions.

Regional Asia
Developing Member Countries for Scaled Up Finance
Project Ref: NDF C89
 

NDF contribution: EUR 0.5 million
Total project cost: USD 1,500,000
Project period: 2016-2017
Partner agency: Asian Development Bank (ADB)

Objectives

ADB approved a Regional Technical Assistance Enhancing Readiness of ADB Developing Member Countries for Scaled Up Finance on 20 December 2013 for a total amount of USD 750,000 financed by the ADB Technical Assistance Special Fund. It is being implemented by ADB's Climate Change and Disaster Risk Management Division (SDCD). The TA aims to help build the capacity of ADB developing member countries to access critical financing for scaling up climate change actions. In its current form, the TA aims to help 3 such countries to develop the capacity to identify priority infrastructure investment projects that mitigate climate change and/or support adaptation to climate change, while creating development co-benefits. One of these priority investment projects (in Fiji) has been approved for support from the GCF. All investment projects identified under this TA will be developed so as to maximise the potential for investment from the GCF and other donors, as well as from multilateral development bank and private sector actors. The TA will help developing member countries to conceptualize financing strategies for these investments, identify capacity gaps and barriers that impede the flow of climate finance, and raise awareness on climate finance.

The TA also aims to help identify new opportunities for scaling up climate investments more in general, which is particularly timely given ADB's recent commitment to double climate financing to USD6 billion annually by 2020. As mentioned above, two concrete proposals are the AC1iFF and the climate challenge through a call for proposals (Unlocking Innovation for Development, the CfP). These are being developed as part of the ongoing TA. Key outputs under the TA are summarised below:

iv. Output 1: Identification of opportunities for new and scaled up climate finance operations;
v. Output 2: Identification of priority infrastructure investment projects and capacity building needs in selected countries; and
vi. Output 3: Enhanced awareness of investment opportunities in low-carbon, climate resilient infrastructure.

The NDF funding will contribute mainly to the addition of two countries to Outputs 2 and 3 under the TA, with a focus on the identification of 2-3 physical priority infrastructure investment projects with significant climate change mitigation and/or adaptation benefits. It is expected that the identified investments will be pursued by ADB, NDF or another donor/investor and deemed bankable, thereby allowing for identification of suitable financing for the projects and subsequent implementation. NDF will follow the identification and due diligence closely to ensure that adequate measures are taken to pursue the identified investment opportunities.

NDF also works closely with the ADB to ensure that NDF priorities in terms of climate change mitigation and adaptation are key criteria in the selection of projects. Further, NDF will act as a knowledge partner to develop AC1iFF and the CfP, based on experience from other similar facilities as well as climate change investments in general.

Financing

The total cost of the TA will amount to USD 1,500,000, of which NDF will contribute USD 500,000.

NDF Contact

Procurement Specialist Erik Holmqvist
Telephone +358 10 618 002

More information

C89 Project Proposal for Small Grant Facility