The Bank of Industry (BoI) has signed an agreement worth 100 million euros with the French Development Agency (AfD) for the expansion of green finance in Nigeria to tackle climate change.
Speaking at the signing ceremony in Lagos on Tuesday, the Managing Director of BoI, Mr. Olukayode Pitan, said the transaction was approved by AFD under its Transforming Financial Systems for Climate (TFSC) Programme with the Green Climate Fund (GCF).
Pitan said the TFSC was a $650 million programme developed in 17 countries for 100 per cent climate investments projects.
He added that the 10-year facility is attractively priced at 2.47 per cent per annum with a four-year moratorium by mixing various concessional resources.
According to local media reports on Wednesday, Pitan pledged that the credit facility would focus on financing investments that contribute to climate change mitigation or adaptation and that it would be specifically targeted at projects focused on renewable energy, low carbon and efficient energy generation, climate smart agriculture technologies, clean urban transportation and others.
“This is the beginning of a long-term mutually beneficial relationship and a significant step for BoI as we scale up our green-lending capacity.
“Given the serious threat that climate change poses to equitable and sustainable development in Nigeria, it is critical for us at BoI to take the lead in mobilizing capital for green and sustainable investment,” he said.
The Country director, AFD, Xavier Muron, highlighted the importance of such a project in the framework of the fight against climate change globally.
Muron noted that Nigeria is highly vulnerable to climate change with several regions likely to suffer from the effects of global warming.
According to him, studies show that climate change would cause Nigeria about $400 billion, that is, between six to 13 per cent of the country’s Gross Domestic Product (GDP).
Muron said that the main objective of the partnership was to spur the country’s financing systems to focus more on the climate aspect and the investment needed to fight the adverse impact of climate change.
GIK/APA