WASHINGTON, USA – The Nordic Development Fund (NDF) signed an agreement with the Inter-American Development Bank (IDB) for a EUR 10 million new contribution to replenish the IDB’s Nationally Determined Contributions (NDCs) Pipeline Accelerator Trust Fund (ACL).
This financing will allow the ACL to continue supporting countries in Latin America and the Caribbean in achieving the Sustainable Development Goals (SDGs) and the Paris Agreement targets, while placing a greater emphasis on the region’s most acute climate challenges. The ACL will continue prioritising small and vulnerable countries in the region. At the same time, it will have a much larger climate adaptation focus, with increased investments in nature-based solutions, circular economy, blue and green economy and e-mobility. Equally, the ACL will have gender equality and inclusion mainstreaming at the core of its investment decisions.
With NDF as its anchor donor, the ACL was established in 2017 and has become IDB’s flagship fund for financing climate action and mobilizing capital towards climate positive investments with the public and private sector actors. Specifically, the ACL provides support to countries in the region with early-stage technical assistance for climate-resilient and low-carbon projects, aligning with the SDGs and Nationally Determined Contributions (NDCs) of the Paris Agreement.
To date, and before this new contribution from NDF, ACL has received more than $25 million from donors, including NDF, the Netherlands’ ministry of foreign trade and development cooperation, the Swedish ministry of foreign affairs, the Austrian federal ministry of finance, and the ministry of foreign affairs of Finland. These donor resources have been matched by the IDB at an almost 1:1 ratio and as of June 2024, the ACL has committed resources for 68 technical cooperation projects totalling $42.5 million. High levels of mobilization and catalysation are also one of the achievements of the ACL. Since its inception, ACL projects have enabled $4.75 billion of IDB and partners lending resources towards public and private climate positive investments.
Now present in 20 of the 26 IDB’s borrowing member countries, the ACL has transformed how member countries approach mitigation and adaptation investments by:
- Setting the basis for scaling up electromobility, creating the first regional fund to promote electric mobility and green hydrogen in Latin America and the Caribbean.
- Supporting sovereign green and sustainability-linked bond markets.
- Facilitating an innovative financing scheme to complete debt-for-nature conversion in Barbados and Ecuador among other initiatives.
In this new stage of the fund, existing donors, with NDF in a leading role have worked together to create an improved results management framework, placing greater emphasis on adaptation impacts, resource mobilization, and on increasing gender equality and inclusion. The aim of this work was to measure and highlight the significant impact of the ACL to attract potential new donors.
“Since its creation in 2017, the ACL’s upstream work and multisectoral approach has allowed countries in the region to ramp up climate action by investing in low-carbon and climate resilient development. As the IDB is transforming for greater impact and scale through IDBImpact+, we thank NDF’s commitment to continue co-funding the Accelerator and helping us leverage resources for climate transformations,” said Graham Watkins, IDB’s Climate Change Chief.
“The ACL is a catalyst for innovative private projects driving regional development in mitigation, adaptation, and resilience. By supporting the pre-investment of private impact projects, the ACL has been instrumental in ensuring that climate solutions are integrated from the beginning, enhancing their financing capacity and promoting the replicability of successful cases,” said Hilen Meirovich, head of climate change of IDB Invest.
“As the first donors of the Fund, seeing the ACL grow and having meaningful impact in the region has made us proud. We have worked together with IDB to mainstream gender equality and inclusion in the new design of ACL, which will help to find climate solutions and build ACL’s capacity to measure its impact to have even better results moving forward. With the enhanced results management framework, we are committed to delivering climate action, monitoring our impact and working towards better climate resilience of the region,” said Satu Santala, managing director of NDF.
