Through a multi-sectoral, flexible, and inclusive approach, CIF’s almost US$25 million investment across 40 projects helped low- and middle-income countries seize opportunities for a green and resilient recovery across multiple sectors, crowd in further investment, and make tangible progress towards their climate goals, a new study shows.
The COVID-19 pandemic triggered a massive global economic crisis. Many countries struggled to meet people’s basic needs, and extreme poverty and inequality both surged. Yet governments and international institutions also responded in extraordinary ways, averting potentially far worse outcomes.
In the first year, the priority was to contain the pandemic and deliver emergency support to households and businesses. Recognizing that some of that early spending could have undermined global climate goals, the focus gradually shifted to a long-term, greener recovery.
To help low- and middle-income countries identify climate smart recovery opportunities across sectors and attract climate finance, CIF’s Technical Assistance Facility launched in December 2020 a special COVID-19 Technical Assistance Response Initiative for Green and Climate Resilient Recovery. Implemented in partnership with six multilateral development banks, the new facility programmed around US$25 million in funding from the United Kingdom, the Netherlands, and Switzerland.
“We stepped up quickly because we knew governments needed support to make the most of this historic moment,” said CIF’s Abhishek Bhaskar, Technical Assistance Facility Lead. “Our goal was to help countries mainstream green recovery in their fiscal strategies, crowd in additional green investments, develop new investment pipelines and strategies, accelerate the transition to climate-resilient development, and provide rapid support for green job creation across a range of sectors.”
Demand for the special initiative far exceeded available resources, but CIF approved 40 projects across 51 countries. A new report prepared for CIF examines the efforts to date in the implementation of the initiative and draws lessons on how technical assistance can best support effective and sustainable responses to global crises.
Graph: Regional distribution of funded projects, by sector
Projects spanned the globe and included 12 countries that had not previously received CIF support, as well as six countries in fragile and conflict situations, which had been particularly hard hit by the COVID crisis. The largest share of funding, US$7.4 million, went to projects focused on integrating climate objectives into fiscal planning, while US$5.8 million went to projects focused on the energy sector — for instance, to create an enabling environment for new low-carbon technologies. Countries also received technical assistance to identify green stimulus opportunities in agriculture, manufacturing, tourism, and other sectors, and to design sustainable strategies for small and mid-size enterprises.
In Jordan, for example, the facility provided support to mainstream climate objectives in public investment management and public-private partnerships; issue green bond guidelines; and mobilize investment through a climate investment portfolio and engagement, among other activities.
In Colombia, support was closely linked to ongoing work focused on decarbonization, resilience, and a just energy transition. In Sudan, CIF funded technical assistance by the World Bank to help develop a new fund to mobilize investment towards off-grid solar energy.
Lessons for effective technical assistance during crises
It is too early to evaluate the final results of the COVID19 recovery initiative, but project reviews and interviews with CIF’s implementing partners and program teams were conducted to draw initial lessons. These could inform future investments aimed at supporting a green and holistic crisis recovery. They include:
“This study highlights the importance of technical assistance to support countries sustain their climate ambitions even in times of crisis,” Bhaskar said. “Timely, flexible support for these activities can make a big difference, helping countries to identify and pursue opportunities, create a strong and predictable enabling environment, and attract new investment to support both climate and economic recovery goals.”