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EBRD and GCF boost climate financing for Mongolia www.neweurope.eu
The European Bank for Reconstruction and Development (EBRD) and the Green Climate Fund (GCF) plan to make climate financing available for climate mitigation and resilience projects in Mongolia.
Smaller firms in Mongolia will benefit from new opportunities to make their businesses more energy efficient and productive thanks to a $4 million loan provided by the EBRD and GCF to XacLeasing, one of the country’s largest financial leasing companies, the EBRD said on September 21.
Hannes Takacs, EBRD Associate Director, Head of Mongolia, noted that for the first time the EBRD is making leasing loans for climate mitigation and resilience projects available to small businesses in Mongolia. “Broadening access to leasing, including widening the range of available leasing products, is one of the Bank’s priorities in the country. We are delighted to partner with our longstanding client, XacLeasing, a leasing company that has the expertise and reach to support that strategic goal,” he said.
The loan is being made available under the EBRD’s Green Economy Financing Facility (GEFF) in Mongolia and blends $1 million of GCF concessional finance with $3 million of EBRD finance, the bank said.
According to the EBRD, XacLeasing is the first leasing company to join GEFF Mongolia and will offer leases to micro-, small- and medium-sized enterprises (MSMEs) for investments in high-performing technologies that improve the use of energy and water resources.
The leases will cover investments in technologies such as energy-efficient production machinery, agricultural irrigation and rainwater harvesting equipment. Beneficiaries can identify climate-friendly technologies with the help of the Green Technology Selector and dedicated technical support is available through a consultancy team funded by the GCF and Japan.
GEFF Mongolia supports gender activities that aim to enhance equal opportunities for men and women to access finance for green technologies, the bank said, adding that it builds on the success of the EBRD’s previous Sustainable Energy Financing Facility in Mongolia that enabled small businesses to finance over 35 energy efficiency and renewable energy investments with a combined value of over to $20 million.
The EBRD GEFF programme operates through an aggregate network of more than 140 local financial institutions across 27 countries, supported by almost €4.2 billion of EBRD finance for 160,000 clients since it began. These projects have led to annual CO2 emissions reductions of more than 8.6 million tonnes.
The partnership between the Green Climate Fund and the EBRD has seen the GCF support seven EBRD programmes with US$ 1.08 billion, catalysing more than US$ 2.7 billion co-financing. The GCF is the largest climate fund in the world to support the efforts of developing countries to respond to the challenge of climate change.
In Mongolia, the EBRD works to help build a diverse economy by developing the private sector and supporting infrastructure improvements. The Bank has invested more than €1.8 billion in 113 projects in the country since it started operations there in 2006.
Published Date:2020-09-25
