Challenges and opportunities for NDBs in the current international climate finance context Washington, D.C., October 6 & 7, 2014

A safe Climate Change future will depend upon: Change investment patterns. Increase the climate investments flow. Optimize the allocation of available funds. Most of climate investments come from the private sector Create innovative business oriented mechanisms that allow the investment flows to be directed towards high impact projects. It is Necessary to promote and/or consolidate different climate finance mechanisms: International Climate Fund (Green fund). Consolidate and include an adaptation fund, the climate investment funds, multilateral banks, bilateral institutions, etc.

It is necessary to promote and/or consolidate different climate finance mechanisms (cont.): National funds. Incorporate climate change to its budget and portfolio to design finance mechanisms Market mechanisms. Carbon market (CDM and Voluntary). Environmental assests. Capital markets indexes, payments for environmental services, etc. Policies. Strong policies and long term environmental regulation. Development banking. Develop mechanisms to promote the active participation of private capitals to finance climate change.

Foster the development of financing instruments: Channel adequate and predictable financial resources. Channel private and public climate financing sources (National and international). Scalability and flexibility. Continuous learning process through constant monitoring and evaluation. Results oriented. Adequate balance between mitigation and adaptation. Development Banks are the better positioned institutions to achieve this objectives.

NDB intervention. Education, training and awereness. “Hoja verde”, training and awareness course in Climate Change (in collaboration with UNEP), partial coverage of training costs to producers. Project structurer. Creation of financial schemes to finance Green projects (government, private financial intermediaries, small producers organizations, etc.).

NDB intervention (cont.) Market structurer (e.g. Technologies and providers) Energy Efficiency Program (Joint with IDB) Administer public resources to mitigate (new projects) risk Bioenergy, Improved irrigation systems, FONAGA Verde, FONAGUA, etc. Long term funding. FONAFOR, Long term loans.

NDB intervention (cont.) Facilitate inclusion to market oriented mechanisms (e.g. CDM) 2 PoAs under the CDM (biodigestion), partial coverage of carbon market registration and verification costs, rubber trees mitigation project (Joint with grupo occidente Guatemala) Use or creation of mechanisms to channel private financial resources. 2nd tier financial institution (FIRA model), schemes to mitigate risk perception to include private participation in climate friendly projects (e.g. Insurance under Energy efficiency Program, joint with BID ).

FIRA´s Strategic partnerships for Sustainability Energy and Water Efficiency study (completed) and Program implementation (Funding) (under development) Environmental and Social Risk Analysis (SARAS) (under development) IDB (Multilateral) AfD (France) GIZ (Germany) Ministerio de Industria, Turismo y Comercio (Spain) Grupo Financiero de Occidente (Guatemala) Sustainable projects financial program (completed) Nationally Appropiated Mitigation Actions (NAMA) (Under development) Energy and Water Efficeincy study in the dairy industry (completed) Rubber tree plantations Voluntary carbon market (VCS) program (Under development)

FIRA´s Green products matrix Carbon Markets Non-refundable assistance PoAs (Programs of activities) Voluntary markets: (Climate Action Reserve CAR / Verified Carbon Standard VCS) NAMAs (Nationally appropriate mitigation actions) Bioenergy FONAGUA FONAFOR FONAGA Verde Technological Asisstance Energy ans Water Efficiency (studies + market structure) Technical cooperation (Studies + Funding) Training workshops (internal and external) Green projects (Portfolio identification and analysis) Guarantees Training and market structuration Energy Efficiency Program Sustainable projects financial program Special Products and Programs

Luis Roberto Llanos Miranda GRACIAS Luis Roberto Llanos Miranda Director General Adjunto de Promoción de Negocios 01 800 999 FIRA (3472) www.fira.gob.mx