Farmers and businesses across various agricultural value chains in Tajikistan will benefit from better access to finance and climate technologies thanks to the Green Economy Financing Facility (GEFF) Tajikistan, which was launched today thanks to the greater partnership among the European Union, the European Bank for Reconstruction and Development (EBRD), the Green Climate Fund (GCF) and South Korea, according to te Euroepan Union Delegation to Tajikistan.
Tajikistan is highly vulnerable to climate change, with water resources, the agricultural sector, the hydropower based electricity generation system particularly exposed.
GEFF Tajikistan is a US$ 25 million facility that offers loans for investments in high-performing technologies that improve the use of water, energy and land resources in Tajikistan, in partnership with local financial institutions. Humo, a local microfinance institution, is the first partner to join the facility, with a loan of US$ 1 million for on-lending to its clients.
These loans will cover investments in various modern technologies, including but not limited to as drip irrigation, energy-efficient cold-storage facilities, rainwater harvesting and storage and solar dryers. Beneficiaries can identify climate friendly technologies through the Technology Selector database and are supported by the GEFF Tajikistan technical assistance team.
The EU offers approximately US$ 4 million of investment incentives to farmers and businesses so that investment in modern and efficient technologies can boost their competitiveness and bring environmental and social benefits as well as access to affordable finance. GEFF Tajikistan blends US$ 6.25 million of GCF concessional finance with US$ 18.75 million of EBRD finance. Over US$ 3 million of funding for technical assistance is contributed by the GCF and South Korea.
In recognition of gender gaps in terms of access to finance for climate technologies, GEFF Tajikistan will carry out activities that aim to enhance women and men’s equal opportunity to access finance and technologies. Such activities will contribute to scaling up private sector climate finance and help wider population become resilient to the impacts of climate change.
GEFF Tajikistan builds on the successful experience of its predecessors, the EU-funded ECTAP facility and the EBRD pilot climate resilience financing facility, CLIMADAPT. The ECTAP was developed and funded by the European Union in close partnership with the EBRD. Under the ECTAP, over $5 million has been disbursed to Tajik smallholders and agribusinesses for investments in modern technologies and high-productive livestock. Such investments were supported by almost $1 million of grants from the EU to address market barriers, contributing to sustainable economic growth and job creation.
The EBRD is a strong partner of the EU in climate action, and the EU supports 14 GEFFs in partnership with the EBRD to scale up private sector climate finance across Central Asia and beyond. The EBRD has invested nearly €670 million (US$ 740 million equivalent) in various sectors of Tajikistan’s economy to date. Modernization, diversification and social inclusion remain key pillars of European Union support to rural development in Tajikistan and EUR 100 million are being invested in the sector during the period 2014-2020.
To date, the GCF has been supporting EBRD programmes worth US$ 830 million, catalysing more than US$ 3.6 billion in total project value. The GCF is the largest climate fund in the world to support developing countries’ efforts to respond to the challenge of climate change.
