DBN Receives Landmark Green Climate Fund Accreditation
By Patience Ikpeme
The Development Bank of Nigeria Plc (DBN) has achieved a significant milestone by receiving the Green Climate Fund (GCF) Accreditation under the Medium Category. This accreditation allows DBN to access GCF’s funding for projects ranging between $50 million and $250 million.
With this development, DBN has become the first Direct Access Entity (DAE) and the sole authorized Nigerian channel for accessing green financing from the GCF. This accreditation empowers DBN to facilitate on-lending, blending for loans, and project management, although it currently does not extend to grant funding, equity, or guarantee instruments from the GCF. Plans are in place to seek an upgrade to include these instruments in the future.
GCF funds will be administered at highly concessionary rates, involving close collaboration with the Nigerian Climate Change Council (NCCC) for project selection, appraisals, and alignment with Nigeria’s Nationally Determined Contributions (NDCs). Shortlisted projects will require detailed funding proposals to be submitted to the GCF for approval. The resources provided by the GCF can only be used for climate mitigation and adaptation projects that align with Nigeria’s NDC focus areas.
Addressing the press in Abuja on Tuesday, DBN’s Managing Director, Dr. Tony Okpanachi, highlighted the numerous benefits of this accreditation for Nigeria. He stated, “Through this collaboration, Nigeria will receive a boost in its fight against the effects of climate change, such as desertification, global warming, unpredictable rainfall patterns, storms, and floods. It will also assist the country’s efforts towards achieving sustainable development and the promotion of environmentally friendly technologies in key sectors of the economy, including agriculture, manufacturing, healthcare, education, transport, and logistics.”
Dr. Okpanachi emphasized that the accreditation would create greater awareness of climate change and increase Nigerian involvement in climate actions. This shift towards a green economy will enhance Nigeria’s portfolio in global climate financing, unlocking additional climate funds. He noted, “Climate change has become an existential threat to humanity. Extreme weather conditions have caused devastating effects on livelihoods – depletion of grazing lands, rising sea levels causing excessive flooding, changing rainfall patterns negatively affecting agricultural yields, poor water and air quality impacting health, and extensive loss of biodiversity.”
With this accreditation, DBN is now empowered to develop and submit funding proposals for projects and programs, oversee their management and implementation, deploy various financial instruments such as concessional loans and co-financing, and mobilize private sector capital for climate change initiatives. The accreditation covers projects under the categories of basic fiduciary standards, specialized fiduciary standards, project management, on-lending and/or blending for loans, and medium-sized projects categorized under ESS Risk: Category B.
The Green Climate Fund (GCF) is the world’s largest dedicated fund aimed at helping small island states, least developed countries, and developing nations reduce their greenhouse gas emissions and enhance their resilience to climate change. The GCF channels climate finance to these countries and invests in their adaptation and mitigation activities through a portfolio of projects implemented by Accredited Entities. These entities, including DBN as a newly accredited DAE, develop funding proposals and oversee the management and monitoring of GCF-approved projects.
This accreditation marks a historic achievement for DBN and Nigeria, providing substantial opportunities for the country to build resilience against climate change.
