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Treasury & Capital Markets
G7 endorses climate financing strategy
EIB and AllianzGI initiative aims to mobilize private investment for climate mitigation and adaptation projects in emerging economies
The Asset 29 Jun 2022

Leaders of the Group of Seven (G7), who met in Elmau, Germany, on June 26-28, endorsed the Emerging Market Climate Action (EMCA) strategy as an example of a concrete innovative and market-led approach to mobilize private investments for climate-relevant infrastructure and to enhance multilateral finance and collaboration. Germany pledged to increase its investment in the vehicle.

EMCA is a blended finance strategy initiated by the European Investment Bank (EIB) and Allianz Global Investors (AllianzGI) to finance climate mitigation and adaptation as well as environmental projects in Asia, Africa, Latin America, and the Middle East.

The strategy aligns with the G7’s ambitious agenda to Build Back Better for the World and narrow the infrastructure investment gap in developing countries, which the group adopted at the last summit in Cornwall, England in June 2021. G7 members are committed to finance high-quality and sustainable infrastructure that ensures a strong recovery from the pandemic and rapid progress towards the Sustainable Development Goals as well as international climate and environment commitments.

EIB president Werner Hoyer says: “The war in Ukraine is the strongest possible argument for greening our economies and accelerating our independence from fossil fuels. At the same time, this decade is critical to address the climate crisis. To do so, we must mobilize trillions of private capital for climate action projects.”

Launched at COP26 in November 2021, EMCA aims to mobilize an initial €600 million (US$630 million) for such projects. Its anchor investors are the governments of Germany and Luxembourg, the Nordic Development Fund, Allianz, Folksam Group and EIB.

The strategy has already made its first investment in ARCH Cold Chain Solutions East Africa Fund, which will support greenfield cold storage, temperature-controlled solutions and distribution facilities to reduce carbon emissions and post-harvest food loss in East Africa.

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