A solar farm in Kampong Chhnang province in 2023. Solar Green Agency Cambodia
A UN Framework Convention on Climate Change has approved more than $100 million in funding which will allow the Cambodian Climate Financing Facility’s (CCFF) to finance high-impact climate projects.
The UN Green Climate Fund (GCF) approved $109 million, during its 38th board meeting in Rwanda on March 7.
According to a project summary published by the GCF, the $109 million consists of a GCF co-financing loan of $50 million and $5 million in grants, with the remaining $54 million provided by additional co-financing.
The climate adaptation and mitigation programme, referred to as FP228, will go through the Korean Development Bank. It is aimed at addressing the investment gap in Cambodia’s resource-constrained priority sector, under the Nationally Determined Contribution (NDC).
The CCFF has the goals of accelerating the implementation of the Kingdom’s NDC, scaling up climate finance and lowering greenhouse gas emissions, while boosting climate resilience, according to the GCF.
“The CCFF will finance high-impact climate projects which are focused on resource-constrained NDC priority sectors, through long-term concessional lending and crowding in private sector participation,” it said.
In addition to tackling financial barriers and market gaps, the programme will also support the capacity building of stakeholders to tackle non-financial barriers and convene stakeholders to coordinate policy dialogues for the development of policy frameworks.
The GCF expect the funding to enable the avoidance of 11.1 million tonnes of emissions, benefiting around 1.3 million people, over 785,000 of them directly.
The UK embassy in Phnom Penh explained in a social media post that the funding was part of the UK’s $2 billion commitment, reinforcing their dedication to global climate change action.
“This investment supports Cambodia’s NDC priorities and underscores our pledge to deliver £11.6 billion [$14.6 billion] in international climate finance,” the embassy said.
Cambodia submitted its updated NDC in December 2020, aiming to cut greenhouse gas emissions by 41.7 per cent by 2030 – a reduction that the NDC estimates at 64.6 million tonnes of carbon dioxide equivalent (MtCO2e) per annum.
Cambodia is deemed extremely vulnerable to climate change, with high exposure to climate hazards such as floods, landslide, cyclone, extreme heat and wildfires.
Many parts of the countries are prone to flooding and strong winds, which destroys homes, crops, and infrastructure in the rainy season.
One effect of climate change could be the unseasonal rain experienced by the Kingdom in January last year, which caused severe flooding to Phnom Penh’s Dangkor district, with more than 1,000 homes affected in 25 villages.
According to the GCF, Cambodia’s economy is highly dependent on climate-sensitive sectors such as agriculture. With a high rural population, climate change could cost up to nine per cent of the Kingdom’s GDP, if no intervention is made.
“A multifaceted strategy is required to solve the climate challenge, including strengthening the capacity of stakeholders in the public and private sectors and using concessional funding to signal to the market the commercial viability of climate projects,” it said.
Environment ministry spokesperson Khvay Atitaya could not be reached for comment on the funding approval on March 7.
