KELVIN KACHINGWE, Songdo, South Korea
THE biggest news, at least for Zambia, to have come out of the 19th board meeting of the Green Climate Fund (GCF) is the approval of a combined US$ 84.5 million for two project proposals in agriculture and energy the country had submitted.
Make no mistake, these are not loans but grants that are all likely to further trigger more funding from the likes of the United Nations Development Programme (UNDP) and the African Development Bank (AfDB). In fact, the total net worth of the two projects is estimated to be around US$240 million.
Not since Zambia hosted the GCF board meeting in November 2015 in the tourist capital, Livingstone, has this sort of meeting made so much meaning for the country than now. And for good measure, the Zambian delegation here is upbeat going forward.
They expect more projects to be approved by the GCF in future.
At the Livingstone board meeting, which was the 11th, Zambia signed a grant agreement with the Fund to accelerate its preparations for climate financing.
Then minister of Finance Alexander Chikwanda joined the Fund’s executive director Héla Cheikhrouhou on the sidelines of the board meeting to sign a grant agreement for US$300,000.
The funding was to support institutional capacity building and the identification of adaptation programmes to realise the country’s Intended Nationally Determined Contribution (INDC).
The INDC is a term used under the United Nations Framework Convention on Climate Change (UNFCCC) for reduction in greenhouse emissions.
“This is an important step in the positive collaboration between Zambia and the Green Climate Fund,” Mr Chikwanda said. “It is particularly appropriate that we are able to sign this agreement in the week that Zambia has the honour of hosting the first-ever GCF board meeting in Africa.”
Every country that was party to the UNFCCC was invited to submit an INDC ahead of the climate conference in Paris, France, in 2015.
But many developing countries, including Zambia, had stressed the importance of working with GCF in order to achieve the goals of their INDCs. Hence the readiness funding that was made available to Zambia to support capacity building so that countries are in a position to undertake larger adaptation projects with the Fund in the future.
However, it is not just the adaptation projects that are rolling in but also those to do with mitigation.
One of the projects that were approved at the 19th board meeting of the GCF is for adaptation and the other for mitigation.
The agriculture project is an adaptation one that was developed by the Ministry of Agriculture and supported by the UNDP as an accredited entity, which are institutions that develop funding proposals to be considered by the GCF as well as oversee, monitor and supervise the approved projects.
The agricultural project titled “Strengthening Climate Resilience of Agricultural Livelihoods in Agro-Ecological Regions I and II in Zambia” seeks to strengthen the resilience of vulnerable smallholder farmers faced with increasing risks of climate change, primarily variability of rainfall and increased frequency of droughts.
The targeted regions for the US$32 million project include selected districts in Southern, Central, Lusaka, Eastern and Muchinga provinces. An additional US$105 million co-financing will be provided by the UNDP and Government to bring the project aggregate to US$137 million in total.
On the other hand, the energy project, dubbed “Zambia Renewable Energy Financing Framework”, has to do with climate change mitigation. It is one of the few private projects to be approved by the GCF at its last meeting.
The US$52.5 million project is being supported by the AfDB as the accredited entity and will trigger a similar amount to be provided by the Bank as co-financing to bring the total project amounts to US$105 million.
The renewable energy proposal, which fits in well with Zambia’s desire to diversify its energy source following the harsh lesson of 2015 when the country experienced huge power deficits following poor rainfall, seeks to catalyse private investment in renewable energy to accelerate the achievement of the country’s electricity generation and diversification targets. Under the project, technical assistance in the form of grants of up to US$5 million will be provided to selected financial institutions in Zambia for sector capacity building to catalyse renewable energy investment.
The energy project will also finance small independent power producers (IPPs) through a line of credit to a local financial institution and direct financing of IPPs project through senior debt and refinancing guarantee.
Ministry of Energy permanent Secretary Emeldah Chola, who attended the 19th board meeting of the GCF, which is headquartered in Songdo, some 65km south-west of Seoul, as an observer, together with his National Development Planning counterpart Chola Chabala, was a happy delegate here.
Well, the entire Zambian delegation was head over heels including Zambia’s Ambassador to South Korea Wilbur Simuusa, who is only three months old here but is already seeing some positives.
“We expect the project to contribute 88 megawatts of power,” Brigadier General Chola said here after the energy project was approved.
Mr Chäbala expects the Fund to approve more projects in future and believes Zambia is well poised as it has built capacity and will continue to do so.
“We expect another two or so projects to be approved at the next board meeting of the fund,” he said. “We’re also trying to get ZANACO, the Development Bank of Zambia and the Ministry of Finance as accredited entities.”
National Designated Authority (NDA) national coordinator Mainga Luwabelwa, whose office is the main liaison between Zambia and the GCF, says ZANACO and DBZ have already been invoiced for accreditation while the Ministry of Finance has opened an account.
“We expect that by June this year, we’ll get national accreditation,” Mr Luwabelwa said.
Ministry of National Development Planning director of development planning Mulele Mulele says they are working at developing the capacity of the country in terms of project proposals.
“We want to deal with the issue of quality, we’ve looked at 178 proposals and recommended eight so far. Some of these proposals are good but they don’t meet the guidelines of the Fund,” Mr Mulele said. “We therefore want to develop a resource centre to help with proposals. We also need to ensure that the proposals speak to the pillars of the Seventh National Development Plan.”
KELVIN KACHINGWE, Songdo, South Korea