DBN Secures $250m Green Climate Fund Accreditation

Just 24, 2024

Development Bank of Nigeria (DBN)

The Development Bank of Nigeria (DBN) has secured accreditation from the Green Climate Fund (GCF), enabling it to access up to $250 million in funding for climate change projects.

This landmark accreditation positions DBN as the first Direct Access Entity (DAE) in Nigeria, granting it direct access to GCF resources without intermediaries.

However, with the accreditation, DBN can only help with loans and project management.

But they are planning to add grants, investments, and guarantees soon.

The GCF funds will be channeled towards climate mitigation and adaptation projects aligned with Nigeria’s Nationally Determined Contributions (NDCs).

These projects will focus on key sectors such as agriculture, manufacturing, healthcare, education, transport, and logistics.

GCF funds will be administered at highly concessionary rates, involving close collaboration with the Nigerian Climate Change Council (NCCC) for project selection, appraisals, and alignment with the Nigeria’s Nationally Determined Contributions (NDCs).

Shortlisted projects will require detailed funding proposals to be submitted to the GCF for approval.

The resources provided by the GCF can only be used for climate mitigation and adaptation projects that align with Nigeria’s NDC focus areas.

DBN Managing Director, Dr. Tony Okpanachi, while addressing journalists in Abuja on Tuesday noted the significance of this accreditation in combating climate change challenges faced by Nigeria, including desertification, flooding, and unpredictable weather patterns.

He highlighted the opportunity to create greater awareness about climate change, promote green economy practices, and attract additional climate finance to Nigeria.

With this accreditation, DBN is now empowered to develop and submit funding proposals for projects and programs, oversee their management and implementation, deploy various financial instruments such as concessional loans and co-financing, and mobilize private sector capital for climate change initiatives.

The accreditation covers projects “under the categories of basic fiduciary standards, specialized fiduciary standards, project management, on-lending and/or blending for loans, and medium-sized projects categorized under ESS Risk: Category B”.

The Green Climate Fund (GCF) is the world’s largest dedicated fund aimed at helping small island states, least developed countries, and developing nations reduce their greenhouse gas emissions and enhance their resilience to climate change.

The GCF channels climate finance to these countries and invests in their adaptation and mitigation activities through a portfolio of projects implemented by accredited entities.

These entities, including DBN as a newly accredited DAE, develop funding proposals and oversee the management and monitoring of GCF-approved projects.

The GCF, as the world’s largest dedicated climate fund, supports developing countries in reducing greenhouse gas emissions and building resilience to climate change. DBN’s accreditation empowers the bank to develop and implement climate-focused projects, leveraging its expertise in financial intermediation.

“This achievement marks a significant milestone for Nigeria in its efforts to address climate change and achieve sustainable development” Okpanachi said.