IFC to help banks unwind coal power plant exposure by 2030
The World Bank group’s private sector funding arm, International Finance Corp. (IFC), has rolled out a program dubbed “30 by 30 Zero,” intended to help mobilize private financing for more climate-friendly projects in the Philippines.
Now active in the Philippines as well as in South Africa and Mexico, the program is aimed at helping financial institutions, especially banks, better incorporate green finance strategies into their investment plans, reduce climate risks and ultimately cut greenhouse gas emissions.
In particular, the goal is to work with financial institutions to strengthen their role as aggregators of climate financing by growing their climate-related lending to an average of 30 percent of total portfolio, with near-zero coal exposure by 2030.
Massive requirements
“Achieving the country’s climate targets requires massive financing, which cannot be met by the public sector alone. Private financing is therefore crucial,” IFC country manager for the Philippines Jean-Marc Arbogast said.
“The financial sector, especially commercial banks, can play a key role in greening the economy by addressing climate-related risks, promoting sustainable development and decarbonizing industries through financing,” Arbogast added.
The program is funded by the government of Germany through the International Climate Initiative, developed jointly by IFC and the World Bank and gathers support from governments, international finance institutions and commercial banks and real sector partners.
Partnership with CARD
In the Philippines, IFC partnered with microfinance service provider CARD SME Bank to boost their capacity to finance climate-smart agricultural solutions for farmers.
Over 3,000 farmers across the country are expected to get access to these solutions starting October.
The 30×30 program also aims to draw more issuers with climate-themed bond offerings to the market, especially with IFC being a major driver of this segment.
In 2017, IFC invested $150 million in BDO Unibank Inc. for the first green bond issued by a financial institution in the country.
Over the following two years, in 2018 and 2019, IFC supported several first green bond issuances.
More recently, last April, IFC supported BDO’s first blue bond to help tackle marine pollution and preserve clean water resources. INQ
