The Green Climate Fund has signed an agreement with the International Finance Corporation (IFC) that will enable IFC to pool its resources with those of more than 40 governments that have contributed about USD 10 billion to support investments in climate action.

IFC, a member of the World Bank Group, is the largest global development institution focused on the private sector in developing countries.

The signing of Accreditation Master Agreements (AMAs) is a prerequisite for GCF Accredited Entities like IFC to implement GCF-supported climate projects.

“Climate change is a global threat,” said IFC CEO Philippe Le Houérou. “Addressing it requires a vast increase in financing — far beyond the capabilities of governments alone. That’s why IFC’s partnership with the Green Climate Fund is an important step. It will enable us to use relatively small amounts of public funds to leverage significantly larger private sector resources to scale up climate-smart investments.”

GCF Executive Director Howard Bamsey said engaging the private sector is crucial in dealing with climate change - both in reducing emissions and in finding innovative ways to make countries and communities more resilient to its effects.

“I am confident IFC’s expertise in the private sector will help expand GCF’s capacity to help overcome key financial barriers,” said Mr Bamsey. “This will pave the way for investments at scale in climate action where they are most needed.”

IFC, accredited by GCF last year, has committed to increase its climate financing to 28 percent of its portfolio by 2020 — up from about 25 percent currently. Since 2005, IFC has invested more than $18 billion in long-term financing for renewable energy, energy efficiency, sustainable agriculture, and green buildings, while supporting private sector adaptation to climate change.