The OPEC Fund for International Development (the OPEC Fund) revealed this week that it has approved more than $300 million in new financing in the first quarter of 2023.
A $54 million (€50 million) loan for Armenia “will support policies to increase climate resilience and mitigation through a series of reforms on energy efficiency, air quality standards and to finance environmental impact assessments,” the OPEC Fund said in a statement.
Colombia has borrowed $150 million to “support policies promoting sustainable and resilient growth by fostering the government’s capacity to plan climate action and promote the energy transition,” the group’s member-funded agency said eponymous oil tanker.
In India, $100 million has been borrowed to build a 35-mile (56-kilometer) ring road “around one of the country’s largest cities, serving a population of more than four million people”.
“The financing [for the South Asian nation] It will also be supported by a $410,000 grant, which will contribute to the preparation and implementation of the project,” the OPEC Fund said.
Seychelles has signed up for $20 million to “help the country strengthen policies to promote inclusive and sustainable growth.” According to the statement, plans for the African archipelago state under the loan include reforms in land development, fisheries and consumer data protection.
‘Climate Action Plan’
The OPEC Fund said the loans reflect its commitment to its Climate Action Plan, launched in September 2022.
“These efforts will help our partners in Africa, Asia and Latin America improve their climate policies while increasing resilience to climate change,” its director general Abdulhamid Alkhalifa said in the statement.
“At the same time, our work on energy access and road infrastructure underscores our continued dedication to improving the lives of people around the world.”
The Climate Action Plan promises an increase in climate finance to 25% of the entire financing portfolio of the OPEC Fund by 2025 and 40% by 2030.
The agency, founded in 1976 by members of the Organization of the Petroleum Exporting Countries (OPEC), said that by September 2022 the share of climate finance in its approved projects was 20 percent.
Good SDGs
The OPEC Fund said in January it had raised $1 billion of its first bond to finance the Sustainable Development Goals (SDGs).
Proceeds from the three-year fixed-rate bond “will be used to finance or refinance key sustainable development projects that are aligned with the OPEC Fund’s multi-sectoral development mission and directly contribute to achieving the SDGs,” a statement from group on January 20. .
The SDGs are a 17-point non-binding United Nations agenda agreed in September 2015. Entering into force the following year, the goals include zero poverty, quality education, gender equality, clean and affordable energy, consumption and production responsible and peace and justice.
The OPEC Fund published its SDG bond framework last year.
“Bond proceeds will be allocated according to specific criteria defined in the SDG Bond Framework focused on food security, health, infrastructure, education, employment and renewable energy,” he said in the January announcement.
The EMEA (Europe, Middle East and Africa) region represents the largest share of the number of investors in the offering at 52 percent. According to the statement, 27% of investors are located in Asia Pacific and the remaining 21% are from North America.
“In terms of investor type, central banks and official institutions accounted for 62 percent, banks 19 percent, asset managers nine percent and insurance and pension funds eight percent hundred,” the statement said.
The OPEC Fund says on its website that it is “the only development institution with a global mandate that provides financing from member countries to non-member countries exclusively.”
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