The European Bank for Reconstruction and Development (EBRD) and the European Union (EU) have agreed a new EUR 50 million programme of financial guarantees aimed at scaling up investment in renewable energy in Ukraine and in the EU’s Southern Neighbourhood with a particular focus on Jordan, Lebanon and Tunisia, the bank has said in a press release.
Under the new programme, the EBRD will provide guarantees to lenders such as local commercial banks, which will allow them to provide financing to projects alongside EBRD loans. The guarantee is expected to help generate total investments of up to EUR 500 million.
This is the first agreement during the bank’s cooperation with the EU through the External Investment Plan (EIP) in the EU neighbourhood regions.
“We’re delighted to partner with the EU for such an urgent cause as climate action. Our lending combined with the EU’s financial instruments encourages more participation of the private sector in investments which are very much needed to face the global challenges of the future, including a more sustainable development model,” EBRD Vice President, Policy and Partnerships Pierre Heilbronn said.
European Commissioner for European Neighbourhood Policy and Enlargement Negotiations Olivér Várhelyi added that the EU is convinced the guarantee provides sufficient risk cover to attract major private sector investment in countries where not enough such financing is available.
According to the report, through the EIP, to date the EU has allocated EUR 4.5 billion in public funds to leverage EUR 44 billion in public and private investment for development in countries neighbouring the EU and in Africa.