The Green Climate Fund (GCF) has unlocked more than US$4 billion in additional resources to support climate investments globally, with Africa expected to receive about 40 percent of the funding.
Catherine Koffman, Regional Director for Africa at the GCF, said the new financing presented a significant opportunity for African countries but stressed the need for stronger pipelines of investment-ready projects to attract the funds.
She made the disclosure in an interview with the media during the GCF Regional Dialogue for West and Central Africa in Accra.
The GCF has approved about US$20 billion for climate investments globally over the past decade, with US$7.6 billion allocated to Africa.
Ms Koffman said although Africa had received a substantial share of the Fund’s financing, the continent’s climate financing needs remained much higher.
“We have unlocked an additional over four billion dollars to invest in the next year or so. And Africa will also get, hopefully again, 40 percent of that,” she said.
She explained that GCF financing was designed to serve as catalytic funding rather than cover the entire cost of climate projects.
According to her, the Fund’s financing was intended to reduce investment risks and encourage private-sector and other investors to provide additional capital.
“Our funding is supposed to trigger three times, four times, five times what we give, because our funding only comes in to mitigate risk,” she said.
Ms Koffman said African countries therefore needed to strengthen their capacity to develop bankable projects capable of attracting larger volumes of private and public investment.
The Fund has committed about US$740 million globally through its readiness programme, including approximately US$250 million for Africa, to help countries strengthen institutions and prepare climate projects.
Ghana, Mali, Burkina Faso and Nigeria are among the countries receiving new readiness grants, with Ghana allocated US$3 million.
Ms Koffman said relatively small readiness grants could unlock significantly larger investments when used to develop viable projects and strengthen institutional capacity.
“The thing about readiness is it might seem like a small amount, but if you put three million of readiness into something, you can unlock six billion dollars of funding,” she said.
She said the GCF was also decentralising its operations to improve access to climate finance and make its processes more responsive to local conditions.
The Fund has established regional offices in Abidjan, Côte d’Ivoire, serving West, North and Central Africa, and Nairobi, Kenya, serving Eastern and Southern Africa.
Ghana had also sought to host a regional office but was unsuccessful.
Ms Koffman said decentralisation would bring the Fund closer to countries and help it better understand local market conditions while reducing the time required to process climate investment proposals.
She said the GCF had also introduced reforms to simplify its processes, following concerns that its procedures had previously been lengthy and bureaucratic.
According to her, the accreditation process, which could previously take up to five years, had been reduced to about nine months or less, while the period for moving an investment idea from a concept note to a funding proposal had also been reduced from about three years to nine months or less.
The Fund has further introduced a project-specific assessment mechanism that allows institutions to submit at least one project for consideration while their accreditation is being processed.
On concerns over increased borrowing to finance climate action, Ms Koffman said grants remained important for African countries, particularly for adaptation projects that did not generate direct revenues.
She said the Fund recognised that Africa’s debt situation required financing approaches that would not further increase the financial burden on countries.
Ms Koffman said the GCF was therefore exploring mechanisms such as debt-for-climate swaps, which could help countries reduce debt obligations while directing resources towards climate investments.
“Our intention is never, never to cause more hardship to the countries that we serve,” she said.
The GCF Regional Dialogue in Accra brought together government officials, finance ministries, accredited entities, private-sector representatives and development partners to discuss ways of improving access to climate finance and building stronger pipelines of climate investments across West and Central Africa.
