Bangladesh, its dev partners move to leverage adaptation, mitigation investments

The government, in association with international financial institutions, donors, and private sectors, on Sunday announced the establishment of the Bangladesh Climate and Development Platform (BCDP) to leverage adaptation, and mitigation investments.

BCDP is a project preparation facility, and financial commitments for public and private investments for adaptation and mitigation in Bangladesh.

The partnership, the first of its kind in Asia, takes place in the context of the $1.4 billion Resilience and Sustainability Facility (RSF) arrangement approved by the IMF in 2023, the programmatic series of Green and Climate Resilient Development (GCRD) Policy Credits by the World Bank totalling $1 billion, and the ADB’s ongoing funding for climate projects in Bangladesh, according to a media release of IMF.

The RSF arrangement and the GCRD credits support reforms to strengthen Bangladesh’s resilience to climate change, advance the decarbonisation of the economy, and manage transition risks.

Bangladesh and its development partners are setting up the BCDP to implement the country’s climate agenda.

The ADB is processing a $400 million policy-based loan to Bangladesh in 2023. About 53 per cent of the ADB’s 2023 project financing ($1.9 billion) has been allocated towards climate financing so far, said the release.

ADB is committed to allocating more than half of its 2024-26 allocation for Bangladesh ($5.5 billion) in support of Bangladesh's climate agenda, it added.

The Korean government also pledged $50 million in support of Bangladesh's climate agenda, and AIIB is considering the provision of an additional $400 million in 2024 at the request of the Bangladesh government, said the IMF.

Meanwhile, the Renewable Energy Facility is expected to mobilize up to $763 million in investments and contribute to the installation of an estimated 750 MWp of new renewable energy capacity in Bangladesh.

Agence Française de Développement is processing a~$320 million climate policy-based loan program, aligned and complementary to the IMF, WB, and ADB commitments.

Bangladesh is currently receiving funding for nine private-sector climate projects with contributions of $441.2 million from the GCF, $135.5 million from other development partners, national implementing entities, and private banks, and $33 million from the Bangladesh government.

The Asian Development Bank, the World Bank, International Finance Corporation, Multilateral Investment Guarantee Agency, Asian Infrastructure Investment Bank, Agence Française de Développement, the European Union and the European Investment Bank, as part of Team Europe, the Green Climate Fund, government of South Korea, Japan International Cooperation Agency, and UK announced the collaborative approach.

“Bangladesh has been at the forefront of those warning about the elevated risks of climate change for vulnerable countries as well as stressing the importance of international collaboration to support those in need,” Kristalina Georgieva, Managing Director of IMF was quoted in the release as saying.

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