Global Green Growth Institute (GGGI)

Hungarian Government to Launch a Climate Finance Instrument to Support Climate Action in the Western Balkans in 2019

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BUDAPEST, Jan 2 2019 - The Hungarian Government approved on December 21, 2018 (Government Decision 1770/2018. [XII. 21.]) the establishment of the Western Balkans Green Center (WBGC), a new instrument to support the implementation of the Paris Agreement. Designed with the support of GGGI under a cooperation project supported by the Ministry for Innovation and Technology of Hungary, the WBGF will support climate actions in six countries: Albania, Bosnia and Herzegovina, Kosovo*, Republic of Northern Macedonia, Montenegro and Serbia.

The Government Decision calls for the set-up of a state-owned company, including financial provisions for the next three years. Responding to the needs of the countries, the WBGF will be complementary to existing instruments and will target areas that are under-financed such as climate adaptation. As early as 2019, the WBGC will support project preparation and capacity building in the region through grant financing in water management, forestry, sustainable energy for buildings and sustainable city sectors.

“The Hungarian Government in collaboration with the Global Green Growth Institute (GGGI) intends to support the green transition of the Western Balkan region through a dedicated fund. With the establishment of the Western Balkan Green Center, Hungary is showing its commitment to the Paris Agreement. The project will result in concrete actions to support climate mitigation and adaptation in a neighboring region”. (Dr. Peter Kaderják, Secretary of State for Energy Affairs and Climate Policy).

The proposal is the result of extensive consultation at regional level, studies and analysis. Furthermore, the proposal was developed under the strategic guidance of an Advisory Committee composed of representatives of ministries, policy experts and other stakeholders.

“I am delighted that GGGI supported the design of an instrument that will help the region meet its objectives under the Paris Agreement. I see a critical role for this Hungarian initiative in supporting green infrastructure investments. GGGI estimates that every USD 100,000 in project preparation funds during the Fund’s first phase may mobilize USD 10 million in infrastructure investments”. (Ban-Ki-Moon, President and Chair of GGGI)

The WBGC is the first step of a broader, more ambitious endeavor, to create a regional multi-donor fund in 2021 supporting project implementation, using blended finance and targeted financial instruments for beneficiaries in Western Balkans. The Government proposal also calls for the set-up of an international committee and further engagement with the Visegrad and other Central European countries for the establishment of the regional multi-donor fund in 2021.

*This designation is without prejudice to positions on status, and is in line with UNSCR 1244/1999 and the ICJ Opinion on the Kosovo declaration of independence.

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