The Green Climate Fund of the UN will finance efficient- and renewable-energy projects headed by SMBs.
The financing initiative was approved during a board meeting of the Green Climate Fund in its Songdo branch in South Korea. It will be run through BID, the crediting agency for the fund, which will act as an intermediary.
The credit line will be backed by BICE for 60 million USD, and it is hoped for that SMBs and other private investors will provide an additional 70 million USD.
The loan also includes 3 million USD for non-refundable technical cooperation that will be directed towards research and technical training.
The initiative coincides with that of the government to increase renewable-energy participation and 20% of electricity consumption by 2025, and reduce all energy consumption by 10.2% by 2030. It is also in-line with the goal to reduce greenhouse gases 18% by 2030.
The credit line will be run through BICE bank directly to the businesses or through their second-tier banking area. Beneficiaries will be SMBs, energy consumers that invest in qualifying energies (like biomass, biofuel and efficient energy), agents of the relevant sector, and local financing institutions.
The Green Climate Fund was adopted as a financing mechanism at the UN Framework Convention on Climate Change (UNFCCC) at the end of 2011.
The objective is to contribute to the objectives of mitigation and adaption to climate change in the international community and to be a main mechanism for multilateral financing to support the actions related to such in developing countries.