Tajikistan’s First MicroFinance Bank (FMFB) has become the latest financial institution in the country to join the EBRD’s Climate Resilience Financing Facility (CLIMADAPT), a programme designed to promote the private sector’s resilience to the effects of climate change.
The loan to the FMFB in Tajik somoni – worth US$ 1 million equivalent – will be co-funded in equal instalments by the EBRD and the Climate Investment Fund’s Pilot Programme for Climate Resilience (PPCR). The funding will be used to finance investments in climate resilience technologies in the commercial and residential sectors.
The FMFB will benefit from technical assistance focused on the adoption of climate resilience technologies in the country. The assistance is provided by the UK government through the Department for International Development (DFID) and by the EBRD Early Transition Countries Fund. The Early Transition Countries Initiative, launched in 2004, aims to stimulate economic activity in the Bank’s countries which still face the most significant transition challenges.
Since the launch of the CLIMADAPT programme by the EBRD in December 2015, the Bank has provided credit lines to Bank Eskhata and microfinance institutions IMON, Humo and Arvand. The FMFB is the latest financial institution to join the programme.
Ayten Rustamova, EBRD Head of Office in Tajikistan, said: “CLIMADAPT is one of the most successful EBRD projects in Tajikistan. We are happy to welcome this new partner to the programme, which will help increase its positive impact on climate change adaptation. The rational use of resources such as land, water or energy is a global challenge. It is also an important issue in Tajikistan. The EBRD is especially pleased to make a contribution with the loan we are signing today.”
Mr. Yenten Lama, FMFB CEO, commented: “The impact of climate change is increasing and some of the worst affected are vulnerable populations with limited resources or know-how. The financial and technical assistance from this initiative will help our customers manage limited resources more effectively and productively.”
CLIMADAPT follows the model of the EBRD’s Green Economy Financing Facility (GEFF) that operates through a network of more than 130 local financial institutions across 24 countries supported by almost €4 billion of EBRD finance for 120,000 clients. These projects have led to annual CO2 emission reductions of over almost 7 million tonnes.
The US$ 1.2 billion PPCR is a funding window of the Climate Investment Funds (CIF) for climate change adaptation and resilience building. The US$ 8.3 billion CIF is providing 72 developing and middle-income countries with urgently needed resources to manage the challenges of climate change and reduce their greenhouse gas emissions.
FMFB provides a full range of banking services through its nationwide network of 7 branches and 29 banking service centres. The network covers all regions of Tajikistan, including remote parts of the country, where the presence of other financial intermediaries is limited. The FMFB has been a client of the EBRD since 2007 and has demonstrated good commitment to the development of EBRD projects and successfully participated in various EBRD initiatives.
To date, the EBRD has invested over €608 million (US$ 700 million) in various sectors of Tajikistan’s economy.
