Rwanda Launches $100 Million Facility To Boost Private Sector Access To Green Finance
- Ireme Invest is a new green investment facility that will increase the private sector’s contribution to Rwanda’s response to climate change.
- The facility, Ireme Invest, is an initiative of the Government of Rwanda through the Rwanda Green Fund and the Development Bank of Rwanda, with support from a range of development partners.
- Ireme Invest will feature a Project Preparation Facility offering grants and a Credit Facility offering concessional loans and a credit guarantee.
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On the sidelines of the UN Climate Change Conference (COP27) in Sharm El-Sheikh, Egypt, the Rwanda Green Fund and the Development Bank of Rwanda have launched Ireme Invest, a groundbreaking new green investment facility that will support Rwanda’s private sector to access green finance and increase the sector’s contribution to the country’s response to climate change.
Rwanda has set an ambitious climate action agenda to build the country’s resilience and foster green growth. To achieve these goals, the country needs investments totaling USD 11 billion. Ireme Invest comes in response to this need by offering a range of financial instruments tailored to meet the needs of Rwanda’s private sector.
“Achieving Rwanda’s ambitious climate action goals requires significant financial resources and engagement from all stakeholders. We are delighted to bring together public and private funding to boost the country’s efforts to address climate change. Ireme Invest will be a one stop centre for private sector-led green investments that will spur innovative green climate solutions. We thank all partners who have made this possible,” said Teddy Mugabo, Chief Executive Officer, Rwanda Green Fund
With initial capitalisation of more than USD 100 million, Ireme Invest will strengthen Rwanda’s ownership of climate finance through first-of-its-kind green finance mechanisms and build the green finance capacity of local banks through innovation, risk mitigation, and deal arrangements.
Ireme Invest consists of several financing instruments and two windows working in an integrated approach. A Project Preparation Facility at the Rwanda Green Fund will offer grants to cover early-stage project activities to move projects from feasibility to bankability. In addition, the fund will provide the operational costs for Ireme Invest. A Credit Facility embedded within the Development Bank of Rwanda will offer credit guarantees and concessional loans.
“Ireme Invest is a truly unique green financing initiative. It puts the private sector in the driver’s seat of Rwanda’s green growth and unlocks sustainable finance for the country’s banking sector. Climate change is a global crisis and everyone needs to play their role. That’s why we are delighted to work with a range of partners who have supported this impactful initiative” said Kampeta Sayinzoga, Chief Executive Officer, Development Bank of Rwanda.
Ireme Invest is designed to support Rwanda to achieve its climate and development goals as well as create green jobs by investing in sustainable agriculture, renewable energy, e-mobility, and others. Investing in these sectors will serve as a driver for Rwanda’s green growth and recovery through the creation of a more resilient and sustainable society.
Strong private sector involvement is paramount to achieving Rwanda’s ambitious NDC climate action plan goals, both in creating green businesses and projects and attracting private investment to meet the current financing shortfall. Ireme Invest’s mandate is therefore to catalyse green and low-carbon private investment in Rwanda, with a focus on blended finance.
Ireme Invest has launched with its first capitalisation round of USD 104 million expected from:
- European Investment Bank – a credit line of up to Euro 20 million
- Agence Française de Développement – a credit line of up to Euro 20 million
- Government of Sweden – a guarantee cover of up to Euro 20 million
- Foreign, Commonwealth and Development Office of the Government of the United Kingdom – a grant of GBP 7 million
- Global Climate Partnership Fund – a credit line of up to USD 15 million
- Development Bank of Rwanda – a capitalization fund of USD 22 million (equivalent in RWF)