News update – 20 Sep 2023

Annual GCF conference convenes key investors and fund managers to accelerate private climate investment

The sixth annual GCF Private Investment for Climate Conference (GPIC) has wrapped up in Nairobi, Kenya, with entrepreneurs, project developers, and investors sharing best practices and innovative ideas to accelerate the private sector’s contribution to finance for climate action in developing countries.

The two-day event took place from 4-5 September in Nairobi, Kenya alongside the Africa Climate Summit, and heard from fund managers, donors, institutional investors, Chief Executives, business owners, GCF Accredited Entities, and project partners from across the globe.

The conference convened a diverse group of more than 250 participants from 60 countries represented. Many participants noted the ‘great energy’ and ‘intimate setting’ of the conference which helped to facilitate an optimal environment for networking. Others commented on the ‘rich and insightful content’ led by experts. Others said:

“My favourite session from Day 1 of the #africaclimateweek was ‘Investing in Nature’ by #gcf #GPIC2023. It was a truly inspirational conversation.”Vera Kloettschen, Climate & Sustainability Adviser, ImpactDev Africa on LinkedIn

“#walkingthetalk this is all we read in #GPIC2023… I find the conference strategic for all stakeholders.”Amolloh Melyne, Regional Responsible Business Program Manager, Neumann Kaffee Gruppe (NKG) on LinkedIn

“I had an incredible experience at the 6th annual #GPIC2023 in Nairobi.”Abdulmajid Nsekela, Group CEO, CRDB Bank on Twitter

Addressing the opening session, GCF Executive Director Mafalda Duarte, highlighted GCF’s key role in accelerating private investment. “We know,” she said, “that investors and developers have an unparalleled capacity to deliver the finance that is needed to create new markets and spur innovation across all sectors. But we know that to unlock this potential, we need to address key barriers and risks. This is where GCF comes in. Not only have we provided USD 4.5B, (15.3 B in co-financing), to private sector projects over the past eight years we are uniquely placed to work globally with international and local finance partners, community-level banks, and financiers who sit embedded in the heart of the communities we serve. This access, combined with our flexible financing instruments, from equity to loans to grants, to concessional finance enable GCF to catalyse significant investment through and across this sector.”

The conference explored a wide range of topics including:

• Replicating successful business models for climate investment;
• Investing in nature through innovative financial instruments and revenue streams;
• Seeding and supporting climate technologies and business models, and highlighting the programmes that use early-stage capital to drive climate finance;
• Navigating the clean energy transition and understanding a holistic perspective to investment across small, decentralised, and large projects, at scale;
• Understanding the nuances involved in measuring adaptation impacts and,
• How to work with GCF, exploring the multiple avenues of support.

Alexia Latortue, Assistant Secretary for International Trade and Development, U.S. Department of the Treasury who also spoke in the opening session said, “The United States sees the GCF as an absolutely central part of the climate financial architecture. We need to see GCF continue to be a vanguard in the climate financial architecture – taking risks, promoting catalytic instruments ringing solutions to the hardest climate finance problems, focusing and reaching the most vulnerable to climate change.”

Jacqueline Novogratz, Founder and CEO of Acumen, a GCF Accredited Entity, emphasised that “What is needed are more financial institutions willing to take risk and provide concessional capital and grants. This is where GCF stands apart. GCF is willing to take that first loss, provide that guarantee, co-create, enable grants to bring in other partners – recognising we can’t do this alone. The partnership between GCF and Acumen has truly been a game changer.”

GCF and CRDB Bank, a GCF Direct Access Entity, celebrated the launch of a project in Tanzania that strengthens the resilience of the agriculture sector by facilitating access to agriculture climate adaptation technologies. Speaking about working with GCF, Abdulmajid Mussa Nsekela, Group CEO of CRDB Bank said, “I must commend GCF because they give you capability. The main benefit that comes from working with GCF is the package of innovative financial instruments on offer. Within USD 100 million, 30% is grants and guarantees, which address fundamental challenges in the agriculture sector. The grant provides technical capacity building for farmers and supports policy intervention. The guarantees de-risk lending and enable farmers’ access to financing. Another key element of this programme is the integration of weather-index-based agriculture insurance, which will accompany all loans under the programme. Such insurance will de-risk the bank’s exposure and contribute to the farmers’ climate resilience. This could not be possible without support from GCF.” 

Dr Mahmoud Mohieldin, UN Climate Change High Level Champion for COP27, Chair of GFANZ Africa Advisory Board, and Facilitator of GCF Second Replenishment, emphasised how climate finance can also address Africa’s development challenges, enabling pathways towards improved energy access, water and food security, and debt solutions. Speaking at the conference, he said, “There is no dichotomy between climate finance and development finance. For those who consider that climate finance detracts from development finance, or who think we don’t need to worry about it now, I say that this is exactly the time we need to consider both together. If we solve for climate, we solve for development too.”

Alloysius Attah, Co-Founder and CEO of Farmline, an investee company of GCF funded project, Acumen Resilient Agriculture Fund (ARAF) — which supports early-growth innovative agribusinesses that enhance the climate resilience of smallholder farmers in Ghana, Nigeria, Uganda, and Kenya — shared how the project helped scale-up funding for his company. He said, “We have raised 20 million dollars [USD] over the past decade, but what is very exciting about our story is that 17 million [of that] came in the last two and a half years when we first raised our pre-series A round led by ARAF, I’d like to take this opportunity to thank GCF and ARAF for supporting us to get to this point.”

The conference closed with remarks by Kavita Sinha, Director of the GCF Private Sector Facility who said “ At least over a billion and half dollars’ worth of new ideas were discussed over the two-day conference and it’s up to each one of us to work in partnership to accelerate great ideas like these and deliver critical climate action to those who need it the most. That is why we are here.”

To access photos from the conference, click here.

For more information about the GCF Private Sector Facility, click here.

High-Level Pledging Conference of the second replenishment of GCF (GCF-2)

GCF’s ability to ramp up financing depends on having new resources to do so. A successful GCF replenishment is critical to unlocking the finance needed to shift from investments to climate impact for developing countries, at scale.  For more information about the GCF Pledging Conference in Bonn, Germany on 5th October 2023, click here.

Source : https://www.greenclimate.fund/news/investment-impacts