Green Climate Fund Plans to Invest $2.3 Billion in Climate Action Opportunities in 2024

Green Climate Fund to Invest $2.3 Billion in Climate Action Plans, Seeks New Partnerships

The Green Climate Fund (GCF), established under a United Nations convention to drive climate action plans, is set to invest up to $2.3 billion in 2024 across 40 different opportunities. The fund, which does not invest directly but through accredited entities and partnerships, aims to expand its footprint in the Asia Pacific region.

Henry Gonzalez, the chief investment officer of GCF, highlighted the fund’s focus on partnerships with institutional investors for blended finance and impact investing. These investments aim to generate positive social and environmental impact alongside financial returns.

The fund, based in Incheon, South Korea, has committed $14 billion of the $30 billion raised from member countries since its inception. Investments range from grants to venture capital and private equity, with a focus on climate adaptation projects in the Pacific islands.

While seeking new partnerships, GCF acknowledges challenges in getting institutional investors on board with blended finance and impact investing. Gonzalez emphasized the need for innovation in deal structuring and attractiveness to attract these investors, particularly in the alternative markets.

Despite the potential risks, Gonzalez believes that investors should view climate finance similar to infrastructure finance, with a dedicated focus on impact capital. He highlighted the importance of quantifying impact and addressing concerns over slightly lower returns for high-impact investments.

As climate financing increasingly shifts towards private markets, GCF is working towards overcoming challenges and expanding its impact in the fight against climate change.