The International Finance Corporation (IFC) private-sector arm of the World Bank has supplied a $200 million loan to South African commercial lender Nedbank Group to bolster the latter's green finance operations and fund renewable energy projects.
The IFC announced the credit line in December and has estimated South Africa offers a $588 billion, ten-year opportunity in “climate smart” renewable energy and urban infrastructure investments.
Arvana Singh, head of sustainable financial solutions for Nedbank, said: “This transaction continues to demonstrate Nedbank's commitment to engage in alternative climate finance mechanisms. These will further develop markets and support projects which create positive impacts aligned to the United Nations sustainable development goals, in pursuit of Nedbank's commitment to building a greener and cleaner economy.”
Adamou Labara, IFC country manager for South Africa, added: “While the immediate future calls for solutions to the economic damage caused by Covid-19, it is critical that we take this opportunity to rethink the structure of our economies, to build a fairer, more resilient, low-carbon future. Working with our partners to develop a strong climate finance market is an important part of this process.”
The South African government has committed to reducing carbon emissions 42% within five years and is aiming to more than double the nation's power generation capacity by 2030, with renewables supplying “as much as 20% of the mix,” according to a press release issued by the IFC on December 21 to announce the green finance loan.
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