Green Fund Initiative launched to combat climate change

Panama City, June 13, 2018.- The Central American Economic Integration System (SICA) region will have resources of 88.1 million euros to promote investments to mitigate the effects of climate change and ensure the sustainable development of the region.

The Green Fund Initiative for the SICA Region will be implemented within the cooperation framework between the European Union, the General Secretariat of SICA, the Central American Bank for Economic Integration (CABEI) and the Government of the Federal Republic of Germany.

The initiative has two components, the first being the so-called Green MSMEs II Initiative, focused on reducing carbon dioxide (CO2) emissions through the generation of renewable energy and the adoption of energy efficiency measures in Central American Micro, Small and Medium-Sized Enterprises (MSMEs), with a donation of 14 million euros from the EU, a contribution from the Government of the Federal Republic of Germany through the German Development Bank, KfW, of reimbursable resources of 40 million euros and non-reimbursable resources of 1 million euros and 7.1 million euros from the CABEI. The Green MSMEs II Initiative will be managed by KfW and implemented by CABEI.

The second component, the Green Development Fund, will facilitate investments at the local level to improve resilience to climate change in vulnerable areas through landscape restoration and integrated ecosystem development.

The resources will be managed by the German International Cooperation Agency (GIZ), in coordination with the Central American Commission for Environment and Development (CCAD) and is supported by the German Ministry of the Environment, Natural Conservation and Nuclear Safety's (BMU) REDD+ Landscape program, which provides 6 million euros, and with an EU financial contribution of 20 million euros.

CABEI will continue to promote interventions that focus transversally on climate change adaptation and mitigation, through financing to countries and MSMEs, pre-investment projects and technical cooperation in projects that seek to reduce the impact on climate change.