“It is time the market got to work on climate change”
One week prior to the 41st G7 summit in Germany, the UK government has committed £50 million of existing funding to the Climate Development Finance Facility (CDFF) to help developing countries tackle climate change. The UK’s Prime Minister, David Cameron, announced this during his meeting with François Hollande in Paris on 28 May to discuss climate change and other issues. Cameron stressed the importance of doing more to get the private sector involved in the world’s fight against global warming. He mentioned that “quite simply”, now is the right timing to get the market to “work on climate change”. CDFF, as a new international initiative for this matter, functions as a way to “back new technologies for a clean energy economy”.
CDFF is a new facility, set up by the Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden N.V. (FMO) in partnership with Phoenix Infraworks, to encourage private sector investment into renewable energy projects in developing countries. Often, project finance in these places is not the most suitable option as it can be complex and time-consuming to realize.
CDFF represents a new approach to funding infrastructure, through which social impact, economic returns and operating infrastructure will be delivered in a faster and simpler manner. The facility is unique because it combines three innovative investment facilities into one facility that can fund the development, construction and re-financing of projects in the wind, solar and hydro sectors.
CDFF was selected as one of four winning pilot initiatives selected and endorsed by the The Global Innovation Lab for Climate Finance (“the Lab”) in April 2015. The Lab is a global initiative that supports the identification and piloting of cutting edge climate finance instruments and aims to drive billions of dollars of private investments into climate change mitigation and adaptation in developing countries.
The £50 million that was announced by the UK government and the EUR 7 million from the Dutch government committed earlier this year enables CDFF to move to the next phase and attract participation of private investors in renewable energy projects in developing countries.
About FMO
FMO is the Dutch development bank. FMO has invested in the private sector in developing countries and emerging markets for more than 45 years. Our mission is to empower entrepreneurs to build a better world. We invest in sectors where we believe our contribution can have the highest long-term impact: financial institutions, energy and agribusiness. Alongside partners, we invest in the infrastructure, manufacturing and services sectors. With an investment portfolio of EUR 8 billion spanning over 85 countries, FMO is one of the larger bilateral private sector development banks globally. www.fmo.nl
About Phoenix Infraworks
Phoenix Infraworks is a infrastructure company established by Andrew Johnstone, ex-CEO of Africa Infrastructure Investment Managers (AIIM), and ex-Chairman of Macquarie Africa. Off this background and a prior career in infrastructure development, the DNA of Phoenix reflects over a decade of ranking as the most experienced and most successful infrastructure fund management expertise in Africa.
