Bank unveils green loans plan to unlock trillions for climate finance | Climate finance

An innovative plan to use public money to support renewable energy loans in the developing world can save cash from the private sector for urgent climate financing.

Avinash Persaud, a special consultant for climate change to the President of the Development Bank (IADB), who develops proposals, believes that the plan can provide new investments in poor countries in a few years and can provide a pile of $ 1.3tn in the climatic financing that developed until 2035.

“This can be a engine for green growth and can produce the trillions required for climate financing in the future,” he said. “This can be a transformation.”

His ideas will be revealed in detail at the UN meeting in Germany this week and will launch negotiations for a COP30 climate summit against a global past for discussions in Brazil this November.

The world’s largest economies, which have missed a deadline in February, still need to offer plans for greenhouse gas emissions before the Brazilian Summit, but so far only a few have done so.

However, researches by The Guardian, the campaign group oil change international studies, show that many developed countries still promise to ör move away from fossil fuels in 2023 in 2023, but plan to expand oil and gas removal.

The analysis found that the US, Canada, Norway and Australia were responsible for 70% of the new oil and gas expansion envisaged in 2025-35.

Oil Change Romain Ioualen, led by international global policy, said: “Planning of large oil and gas expansion of countries with the highest income and largely historical responsibility to cause a climate crisis, without paying attention to the sources of life and livelihood.” He said.

The two-week meeting at Bonn, which ended on June 26, will come to the forefront when they need to reduce the vital issue of finance for developing countries and to cope with the effects of excessive air.

Recommendations for Persaud and others to receive loans to renewable energy projects in the developing world may allow billions of dollars of private sector cash to give great support to global climate financing.

The plan led by the IADB will include the purchase of existing loans to green projects in poor countries from the private sector lenders, which will include the purchase of development banks financed by the taxpayer.

Such loans are relatively low because they are already performing – but because they are in developing countries, their credit ratings are lower than the rich states – the mainstream private sector investors, such as pension funds, are forbidden to touch them due to strict rules of credit value.

However, if these loans are supported by Development Banks, which can guarantee defaults and have their own perfect credit ratings, the “re -packaged” credit financing may meet the private sector criteria.

Barbados’ prime minister Mia Mottle, former adviser Persaud, said, “He noticed that there was $ 50 billion to make green loans in Latin America,” he said. “Why don’t you buy it to create new projects?”

When the key to the concept is purchased by development banks who pay a small premium to existing private sector creditors with loans and loans, the creators of renewable energy projects should agree to use the financing they have accessed in new projects.

This creates a “virtuous circle ği where developers who have expertise in establishing successful renewable energy plans when loans are purchased.

IADB is now trying to start the program and is expected to send a request for the offer before the COP30 in the next few months. The first credit portfolio is likely to be about $ 500 million to $ 1 billion.

Many private and public sector experts, Persaud’s ideas may have a great impact, he said.

Mattia Romani, a COP30 consulting with COP30 on climate financing, said, “It is a very powerful initiative of both pragmatic and innovative. Considering the inevitable restrictions in the coming years, it is one of the few realistic tools to reach out. [the sums needed].

“This initiative is designed to open the lock of corporate capital in order to protect corporate capital into motors for the transition -based needs of corporate investors by taking advantage of the balance sheets of domestic commercial banks of domestic commercial banks.