Phl, France inks €150-M climate change loan accord
In the Philippines, climate action is at the heart of the Agence Française de Développement activities: this new program loan follows a previous €250-million adaptation program loan mobilized at the end of 2021 to reduce the risk of natural disasters at t
The Department of Finance and the Agence Française de Développement have signed a €150 million loan agreement for the Climate Change Action Program, Subprogram 1 which is intended to mitigate and adapt to climate change.
The Philippines is one of the most vulnerable countries to climate change and has been ranked fourth most affected country by extreme weather events between 2000 and 2019.
In addition to their direct impact on people, the economic consequences of these disasters will cost the country more than $3.5 billion a year by 2040.
As the Philippine economy struggles to recover from the Covid-19 pandemic, the Philippine government has adopted an important climate action program to move toward adaptation and mitigation, submitting its first nationally-determined contribution in 2021 at COP26.
France remains engaged
Michèle Boccoz, Ambassador of France to the Philippines said that “France remains more than ever engaged in a race against time for the preservation of our planet, and the fight against the climate crisis that becomes a concrete and devastating reality in the Philippines. In this fight for justice and solidarity, France is taking full part.”
She added, “It (France) will devote €6 billion each year, until 2025, to help developing countries, including the Philippines, finance their transition and cope with climate disasters.”
Meanwhile, both the AFD and the Asian Development Bank are in support of the Philippines’ ambitions to scale up its climate action with a combined policy-based loan of an equivalent €390 million, including €150 million mobilized by AFD in addition to the $250 million loan extended by the ADB for the CCAP1.
It is intended to back the country in achieving its NDC and in its efforts to transform vulnerable sectors into a resilient, low-carbon economy.
This new program is an example of the parties’ joint commitment.
Strengthen climate action
More specifically, it will support public reforms aimed at setting up planning and financing systems to strengthen climate action, but also to strengthen the resilience of populations to the growing impacts of climate change and to reduce greenhouse gas emissions through the deployment of renewable energies, improving energy efficiency and deploying sustainable transport.
Finance Secretary Benjamin Diokno said, “As a country vulnerable to climate change impacts, which cost us over 1 percent of the country’s GDP [gross domestic product] in direct losses to public and private assets because of earthquakes and typhoons, the Philippines is committed to pursuing concrete climate actions with the aim of protecting the most vulnerable from its devastating effects.”
Added Diokno, “The Marcos Jr. administration demonstrates this commitment by allocating around 8.72 percent of the 2023 National Budget for climate change mitigation and adaptation programs that will allow us to meet our NDC targets.”
For her part, Bénédicte Gazon, AFD country director said that “since the Paris Agreement, the AFD Group has provided €30 billion in climate finance, including €7 billion for adaptation.”