NEFCO becomes first Nordic institution accredited by the Green Climate Fund
The Green Climate Fund (GCF), a global fund created by the United Nations Framework Convention on Climate Change (UNFCCC) to support the efforts of developing countries to respond to the challenge of climate change, has announced a decision to include the Nordic Environment Finance Corporation (NEFCO) as one of its accredited entities.
At its recent Board meeting in Bahrain, the Green Climate Fund (GCF) decided to include the Nordic Environment Finance Corporation (NEFCO) as one of its accredited entities. The accreditation offers new opportunities for NEFCO to blend its financing with GCF and other accredited entities’ funds and further increase the capabilities of developing countries to grow in a sustainable way.
GCF seeks to use public investment to stimulate private finance, unlocking the power of climate-friendly investment for low-emission and climate-resilient development. To achieve maximum impact, GCF seeks to catalyse funds, multiplying the effect of its initial financing by opening markets to new investments.
The Nordic countries had the exact same vision when they established NEFCO in 1990 with the aim to increase awareness of environmental and climate issues outside the Nordic countries through the provision of cost-efficient financing of sustainable development investments in the surrounding regions.
Today, NEFCO’s activities are global, but its financing operations are still focused on Eastern Europe and the implementation of small and medium-sized projects (SMPs) with demonstration value. Due to its focus on SMPs, NEFCO fills a gap, supplementing financing offered by the larger international financial institutions (IFIs).
We are very pleased to be the first Nordic institution to be accredited by GCF. Our particular strength lies in the fact that we are a ‘project factory’ and have a long track record in relatively fast implementation of innovative small and medium-sized private and public environmental projects, said Helle Lindegaard, Vice President, Trust Funds and Climate, at NEFCO.
NEFCO also puts particular emphasis on offering hands-on environmental advice and building capacity to gradually enable its smaller clients to become better at mobilising additional finance also from other sources.
We have already identified some possible project leads for which we will seek support under the GCF Simplified Approval Process Pilot Scheme. We are very much looking forward to contributing to the paradigm shift objective of GCF by making use of our green growth track record and extensive network of trusted public and private partners to deliver effective, transformational and innovative climate-financing mechanisms with sustainable development impacts, Lindegaard said.
The Nordic Environment Finance Corporation (NEFCO) is an international financial institution established in 1990 by the five Nordic countries: Denmark, Finland, Iceland, Norway, and Sweden. NEFCO’s green financing is targeted at small and medium-sized projects and focuses on generating environmental benefits through these project implementations.
All projects to be financed by NEFCO need to demonstrate that they will benefit the environment in a cost-effective way. To ensure that these benefits will in fact materialise, financing is released in tranches against monitored milestone results, and environmental outcomes are monitored annually for as long as NEFCO is involved.