One-stop shop will spur efforts to transform Paris pledges into investment plans
The Inter-American Development Bank (IDB) and the Inter-American Investment Corporation (IIC) – together, the IDB Group – announced the creation of NDC Invest, a one-stop shop to help countries access resources needed to translate national climate commitments into investment plans and bankable projects.
In April of this year the Governors of the IDB Group committed to the goal of doubling the Group’s volume of climate-related financing by 2020. That commitment reflected the likely increase in demand from countries seeking financing for implementation of their Nationally Determined Contributions (NDCs), prepared for the November 2015 Paris Conference on Climate Change. The Paris conference culminated in an ambitious global agreement to combat climate change and to accelerate actions and investment needed for sustainable low carbon and climate resilient development pathways.
NDC Invest is a platform comprised of four elements: NDC Programmer, NDC Pipeline Accelerator, NDC Market Booster and NDC Finance Mobilizer. Together, the components aim to enable progress toward both the NDC and IDB lending objectives, as well as toward achievement of the UN Sustainable Development Goals.
“We are offering a comprehensive package of support for countries to implement their commitments from the Paris Agreement,” said Juan Pablo Bonilla, Manager of the IDB´s Climate Change and Sustainable Development Sector. “With the right mix of policy assistance and financial instruments the IDB Group can play a pivotal role in mobilizing investors to deliver the scale of investment required for sustainable infrastructure.”
According to various estimates, the countries of Latin American and the Caribbean must increase their infrastructure investments from the current regional average of 3 to 5 percent of Gross Domestic Product to remain internationally competitive. The Paris commitments in addition require that such investments be sustainable, in an effort to keep global temperature rise to well below 2ºC above pre-industrial levels by the end of the century. The NDC Finance Mobilizer component of NDC Invest in particular seeks to improve countries’ access to external concessional resources, in addition to financing from the IDB and the IIC. A key objective will be to provide the credit-enhancement that may be needed to mobilize private capital.
Over the coming months governments, private companies and non-governmental organizations will be invited to partner in the development of the initiative with the aim of creating a regional public–private platform that can work to deliver the low carbon and climate resilient investments that the region needs.
The announcement of NDC Invest will take place at the IDB during the launch of the 2016 report of the Global Commission on the Economy and Climate, The Sustainable Infrastructure Imperative. The report sets out an action agenda for investing in sustainable infrastructure as the key to tackling the three central challenges facing the global community: driving growth, development and climate action.
About the IDB
The Inter-American Development Bank is devoted to improving lives. Established in 1959, the IDB is a leading source oflong-term financing for economic, social and institutional development in Latin America and the Caribbean. The IDB also conducts cutting-edge research and provides policy advice, technical assistance and training to public and private sector clients throughout the region.
About the IIC
The Inter-American Investment Corporation (IIC), a member of the Inter-American Development Bank (IDB) Group, is a multilateral development bank committed to supporting the private sector in Latin America and the Caribbean. The IIC finances sustainable enterprises and projects to achieve financial results that maximize social and environmental development for the region. With a current portfolio of $7 billion under management and 330 clients in 20 countries, the IIC works across sectors to provide innovative financial solutions and advisory services that meet the evolving demands of its clients.
- John Ferriter
Chief, IDB Climate Change Division