The Climate Finance Accelerator (CFA) is a technical assistance programme funded by the UK government to help middle-income countries achieve national climate plans. By identifying the challenges facing substantial projects and with help of experts, the CFA seeks to unlock a steady flow of funding for climate projects at scale and create a pipeline of “investment ready” low-carbon projects, states the programme’s website.
The British Embassy in Egypt celebrated the launch of the programme in Egypt at the beginning of the month and an increase in the number of countries benefiting from the project to eight worldwide.
CFA Egypt aims to help in designing low-carbon, investable projects; establish climate finance networks; improve participants’ understanding of climate finance; increase policymakers’ awareness of the impact of climate finance on the environment; and finally contribute to embedding a permanent CFA process in Egypt.
During the embassy event, FSD Africa, a UK organisation aiming to deepen the continent’s financial sector, and the Egyptian Financial Regulatory Authority (FRA) signed a Memorandum of Understanding (MoU) to help make the financial sector in Egypt more sustainable.
Minister of Environment Yasmine Fouad, also ministerial coordinator and envoy for the UN COP27 Climate Conference, and Minister of International Cooperation Rania Al-Mashat participated virtually in the launch ceremony.
Al-Mashat delivered a speech during the event stressing the need for “multilateral cooperation and joint efforts” with development partners to support the transition from pledges to implementation, stimulate climate action efforts, and implement projects that reduce harmful emissions.
Speaking of the CFA, she said it will work with the government to scale up climate finance to advance national efforts to transition to a green economy.
British Ambassador to Egypt Gareth Bayley, said that “the Climate Finance Accelerator is already making a difference elsewhere in Africa and around the world. It is great news that Egypt will now feature as part of this innovative approach to help low-carbon projects secure investment.”
Climate financing is one of the key demands for the COP27, and Bayley said that the introduction of the CFA in Egypt will show that “we are not only listening, but also taking action.”
Meanwhile, Chair of the Egyptian Financial Regulatory Authority Mohamed Farid said that the CFA will ensure the alignment of financial flows towards climate action, as it requires the mobilisation of huge financial resources.
Funded by the UK government, the global technical assistance programme aims to streamline and trickle down the needed financial support for low-carbon projects to deliver on countries’ ambitions to limit global warming to 1.5° C.
The GBP 10.8 million, four-year programme is looking to select eight to 12 projects at the pre-feasibility stage and provide them access to $1 million in funding, with each accelerator cycle for the selected project developers lasting six to nine months. Applications to benefit from the project closed on 16 October.
The projects will be monitored and chosen by various international and Egyptian experts with practical, technical, and financial support and advice, in addition to gender equality and social-inclusion experts who will help increase candidates’ chances of securing the financing they require.
The project selection will be based on four main criteria: climate mitigation potential, project maturity, financial structuring, and gender equality and social inclusion.
The programme is funded by International Climate Finance (ICF) on behalf of the UK government and is being delivered locally by PricewaterhouseCoopers UK and implemented by Genesis Analytics and Acumen Consulting Egypt.
It will help in securing investment for climate-friendly projects and ultimately supporting Egypt to develop a sustainable pipeline of bankable, low-carbon projects.
The CFA offers a wide range of benefits to assist climate-mitigation projects, such as access to investors, coaching and best practice insights, networking opportunities, increased visibility, and achieving low-carbon objectives.
In order for projects to be eligible, they should have direct greenhouse-gas emission reductions, have a minimum of $1 million financing needs, be at the pre-feasibility stage of development, and will generate commercially viable returns in the long term. They should also demonstrate positive social impacts and contribute to furthering gender equality and social inclusion.
The CFA comes within the framework of cooperation with the UK government to advance climate action. It aims to partner up with governments in middle-income countries to stimulate increased climate finance through joint work between funding providers, experts, and those concerned with climate action.
The CFA also supports projects that contribute to the implementation of Nationally Determined Contributions (NDCs), as determined under the 2015 Paris Agreement on Climate Change, and builds the capacities of managers working in these projects.
It has been applied in seven other countries, namely Nigeria, Mexico, Colombia, Turkey, South Africa, Pakistan, and Peru.
The UK aims to provide technical assistance worth LE10 million as part of joint efforts between both governments to expand the scope of climate action.
*A version of this article appears in print in the 27 October, 2022 edition of Al-Ahram Weekly.