The European Bank for Reconstruction and Development (EBRO) and the European Union (EU) have agreed a new €50 million program of financial guarantees aimed at scaling up investment in renewable energy in Ukraine and in the EU’s Southern Neighborhood with a particular focus on Tunisia, Jordan and Lebanon.
According to a press release published by EBRD Wednesday, this is the first guarantee program by the Bank to receive funding through the EU External Investment Plan (EIP), an EU initiative launched in 2017 with the aim to attract more investment, especially from businesses and private investors, into countries neighboring the EU and in Africa.
Under the new program, the EBRD will provide guarantees to lenders such as local commercial banks, which will allow them to provide financing to projects alongside EBRD loans. The guarantee is expected to help generate total investments of up to €500 million.
Through the EIP, to date the EU has allocated €4.5 billion in public funds to leverage €44 billion in public and private investment for development in countries neighboring the EU and in Africa.
The EBRD will implement the largest volume and number of guarantees under the EIP in the EU Neighborhood.
The projects under this program will help unlock countries’ substantial renewable energy potential, promote the development of renewable energy more widely and demonstrate how the private sector can help meet growing demand for energy, the press release added.
According to European Commissioner for European Neighborhood Policy and Enlargement Negotiations Olivér Várhelyi, “the guarantee agreement will help finance many more renewable energy projects, with private sector financing.
It will cut greenhouse gas emissions, first in Ukraine and then in countries in the EU’s Southern Neighborhood, with a particular focus on Jordan, Lebanon and Tunisia.”