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Infrastructure Trust Fund
and Climate Change
Alexis BONNEL
Sector Operations
Agence Française de Développement
Agence Française de Développement – AFD – www.afd.fr
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ITF and Climate Change
The insider’s view
 Contribution of ITF co-financed projects on climate
change mitigation and adaptation
The outsider’s view
 A performing blending instrument
 An example to follow by Climate Change negotiations
on future financing architecture
Agence Française de Développement – AFD – www.afd.fr
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Climate Change inside ITF
 Climate change adaptation & mitigation are major issues
in Sub-Saharan Africa
 Adaptation : many countries extremely vulnerable
 Mitigation : increasing dependence on fossil energy ; poor resilience of
development paths to external energy shocks (depletion of fossil
resources, price volatility, …) ; deforestation
 ITF already contributes on both agendas at project level
 Climate impact of projects is optimized by also working
at policy making level and through capacity building
 e.g. spatial planning
 Flexible interpretation of geographical scope and
regional mandate of ITF needed
 e.g. improving performance of national power utilities, addressing
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Agence
Française
de Développement
– AFD – www.afd.fr management issues, …
energy
efficiency
and demand-side
Climate Change inside ITF
Next steps ?
 Request systematic carbon footprint (mitigation) ?
 Request systematic vulnerability analysis (adaptation) ?
 Define carbon objectives/guidelines/strategies of ITF ?
 Enhance knowledge sharing, best practice dissemination
and joint analytical work between ITF members
Agence Française de Développement – AFD – www.afd.fr
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The outsider’s view :
Climate finance and ITF
Source : Bilateral Finance Institutions and Climate Change:
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Agence Française de Développement – AFD –Awww.afd.fr
Mapping of Climate Portfolios; Stockholm Environment Institute, 2009
Current situation of international
public climate finance
World Bank $2bn
11%
GEF $0,5bn
3%
Bilateral + EIB: 66%
AFD (France) $1,8bn
10%
EBRD (Europe)
$0,9bn
5%
ADB (Asian Dev
Bank) $1,5bn
9%
JICA (Japan) $6,3bn
36%
IDB (InterAmerican
Dev Bank) $1,1bn
6%
Multilateral: 34%
EIB (Europe) $1,1bn
6%
KfW (Germany)
$2,4bn
14%
2008 data, based on climate finance reporting of relevant institutions
NB : European Commission does not currently report on EdF climate change interventions
Several programs sponsored by EdF could be considered as climate finance, including some funded by the Energy Facility
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Agence
– AFD – www.afd.fr
USD 18
bnFrançaise
(EUR de
12Développement
bn) committed
annually on mitigation and adaptation
Climate finance / COP
A paradigm change
 Tackling climate change means investing
 In all sectors: energy, transportation, water, housing, industry, agriculture…
 By structuring demand and making projects financially viable
 Catalyzing hundreds of billions…
 By mobilizing the whole range of existing and future means of financing :
national and international tax system and markets, carbon markets,
public and private sector
 By creating leverage effects with tools dedicated to climate: stockholders
equity, grants, loans, guarantees…
 … and reforming ODA, a major player in supporting countries
and catalyzing finance
 By creating a system that responds to countries’ demands
 By supporting and reinforcing the emergence of national institutions in
developing countries
 By conditioning aid solely on the criteria determined by the COP
Agence Française de Développement – AFD – www.afd.fr
 By guaranteeing priority of access to the poorest
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An innovative and quickly operational
financial mechanism
 Governed by the Parties
 Giving developing countries the choice of their donors
 Promoting collaboration and competition
 For more innovation and efficiency
 Using funds fairly
 By adapting budgetary efforts to the nature of the investments and
beneficiaries
 By using subsidies to make projects financially viable
 By attracting public and private, international and national investments
 And quickly
 By mobilizing all existing channels
 Predictable and sustained flows, guaranteed by the COP
 By placing the mechanism under the authority of the COP
 By creating a binding system of financial contributions by Parties
Agence Française de Développement – AFD – www.afd.fr
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International blending facility
COP
NAMAs
International blending facility
High Level Body
Registration Database
Policies/Local govts/Companies
Financing
requests
Executive committee
of the Facility
Credit committee of the
International blending facility
Contributions by Parties
and/or innovative financing
mechanisms
Adaptation
strategies
Additional
grant requests
as needed
Grants +
loans +
guarantees
+ other
financial
tools
Grants
Grants
Agence Française de Développement – AFD – www.afd.fr
Pool of financiers
National, bilateral, international, private
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Thank you …
Agence Française de Développement – AFD – www.afd.fr
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