NDF - Financing for climate change and development projects

Support to Green Climate Fund proposal development in Mozambique

Photo: NDF
Maputo-KaTembe bridge.
Photo: NDF
People waiting for the bus in Maputo.
Photo: INAM
Devastation in Beira after Hurricane Idai, March 2019.

NDF and the World Bank (WB) will share the costs of preparing a full Green Climate Fund (GCF) funding proposal package for Maputo, the capital of Mozambique

The Nordic Development Fund (NDF) has approved a grant of EUR 500,000 that will contribute to the costs of preparing a full GCF funding proposal on the Maputo Urban Transformation Project(MUTP) in Mozambique.
The proposed GCF funding will complement a new WB USD 120 million loan to Mozambique and allow for increasing the climate scope and coverage of the MUTP in Maputo.
The proposed intervention areas for the planned GCF funding consist of informal settlements in Maputo including the city centre Baixa and the district of KaTembe that face growing challenges due to climate change and the high rates of poverty. More than 70 percent of Maputo's population resides in informal settlements with no drainage and poorly constructed houses, which drastically increases their vulnerability to high-intensity storms. Maputo is already highly vulnerable to sea level rise and coastal erosion under the present-day climate. The city centre is particularly vulnerable to sea level rise, resulting in seawater back-flowing through the drainage canals and flooding several areas. KaTembe has a vast natural environment area (mangroves, floodplains, beaches and coastal line) that functions as natural protection to climate events. However, due to the new urbanisation axis opened after the inauguration of the Maputo-KaTembe Bridge, this important natural environment could be destroyed due to informal urbanisation.
Mozambique experiences an increasing trend of drought and floods that negatively affects the country's social and economic development. The most recent Cyclones Idai and Kenneth hit the coast of Mozambique in 2019 with catastrophic impacts affecting almost 2 million people and causing damages of an estimated USD 2.2 Billion.
The development of a full GCF funding proposal for MUTP will seek to have the proposed intervention focus on addressing the main drivers of urban vulnerability including informality, exposure and poverty. The plan is to have the GCF MUTP proposal focus on transforming informal settlements into climate-resilient neighbourhoods with decent housing and economic opportunities.
The Nordic countries are staunch supporters of the Green Climate Fund, which is the financing mechanism for the UNFCCC. The general concept for GCF came out of COP15 in Copenhagen, Denmark, in 2009, and Denmark, Finland, Norway and Sweden are or have been members of the GCF Board. The Nordic countries have pledged significant contributions to the capitalisation and demonstrated their commitment by being among the first countries to sign contribution agreements with the GCF. In the recent GCF replenishment process, the four Nordic countries Denmark, Finland, Norway and Sweden contributed more than 15% of the total capital increase. Sweden is the single highest per-capita contributor and together with Norway, they are among the six countries that provided the lion's share of almost USD 10 Billion raised by the Green Climate Fund.
More information:
Development of GCF Proposal on Maputo Urban Transformation Project (MUTP) [NDF C125]
Green Climate Fund (GCF)