1.2 billion of this amount was in partnership with banks and financial institutions, IFC climate program leader says
International Finance Corporation (IFC), a member of the World Bank Group, provided nearly $2.8 billion in loans and equity to Turkey in the past five years for green bonds, green buildings and energy efficiency projects, Patrick Avato IFC's Program Leader for Climate Business & Cities or Senior Operations Officer, told Anadolu Agency on Thursday.
"In the past five years, the IFC has helped the private sector and municipalities to make climate-smart investments," Avato said, adding that $1.2 billion of this amount was in partnership with banks and financial institutions to promote on-lending by Turkey’s banks to small and medium-sized enterprises (SMEs) for sustainability and energy efficiency projects.
He underlined that new financial instruments were also introduced to Turkey for the first time through green bonds and green mortgages.
Avato exemplified Izmir for its holistic approach to sustainability projects, which tackle growing congestion and pollution issues through major investments in public transport, including a new ferry service, metro line, tramway, and a smart traffic lights network.
"IFC is putting a major emphasis on supporting cities like Izmir and Istanbul to help create cities that are livable, function well and provide economic opportunities to their residents. Over the past six years, IFC has committed $250 million and mobilized $315 million in direct support for Turkish municipal infrastructure," he declared.
Climate-smart investment offers major opportunities for investors in emerging markets, Avato asserted. He said that despite low oil prices and slow progress on global climate negotiations, record high investments in renewable energy and energy efficiency globally have been seen in the last two to three years.
"This tells us that these investments are driven by fundamentals and are here to stay," he said.
- "Right business conditions" - key in fight against climate change
The IFC's newly launched report on Thursday entitled Creating Markets for Climate Business highlights the importance of private sector investments for meeting the climate targets of developing countries.
Trillions of dollars in private investments can be triggered through a combination of smart policy reforms and innovative business models, the IFC said, adding that seven industry sectors can make a crucial difference in catalyzing private investment: renewable energy, off-grid solar and energy storage, agribusiness, green buildings, urban transportation, water, and urban waste management.
"Already, more than $1 trillion in investments are flowing into climate-related projects in these areas," the corporation noted but added that trillions more could be triggered by creating the "right business conditions" in emerging markets.
“The private sector holds the key to fighting climate change,” said IFC CEO Philippe Le Houerou.
“The private sector has the innovation, the financing, and the tools. We can help unlock more private sector investment, but this also requires government reforms as well as innovative business models—which together will create new markets and attract the necessary investment. This can fulfill the promise of Paris [Paris climate agreement],” he concluded.
By Ebru Sengul