Donor support for climate change initiatives in the Middle East and North Africa

This review focuses on financial support for climate change mitigation and adaptation initiatives to Middle East and North Africa’s (MENA) countries such as Algeria, Egypt, Iraq, Jordan, Lebanon, Libya, Morocco, the occupied Palestinian Territories (OPTs), Syria, Tunisia and Yemen.

Donors in MENA climate and environment space include both bilateral donors such as France and Germany, and multilateral development banks and multilateral climate funds. France and Germany are key bilateral donors to the region, supporting both single country and regional programmes. Many donors, including the EU, France, Germany, the Netherlands, Sweden and Japan, also channel their support to climate change mitigation and adaptation initiatives through the European Bank for Reconstruction and Development (EBRD), the European Investment Bank (EIB), and multilateral climate funds, notably, the Clean Technology Fund, and the Green Climate Fund. The Islamic Development Bank also plays a role in climate change initiatives, co-financing projects with the EBRD and others.

Key findings include:

• There are more mitigation than adaptation projects, with a strong collective focus on renewable energy. Notable investments and donors to renewable energy include the Clean Technology Fund’s support for the Noor Plan in Morocco, and the European Bank for Reconstruction and Development’s Renewable Energy Financing Framework in Egypt.
• The European Bank for Reconstruction and Development (EBRD) is a key donor supporting a large number of projects across the region, but also supporting large-size projects in terms of the amount of finance. The EBRD often partners with multilateral climate funds including the Green Climate Fund (GCF). Whilst the EBRD’s investments often centre on renewable energy, it has some large regional programmes, such as the Green Cities Facility, which focus on areas such as low-carbon growth and access to finance.
• Egypt and Morocco appear to be the preferred countries for donors to support. Projects in these countries largely focus on renewable energy, although there are a small number of projects related to adaptation, some projects focused on water resources and some on energy efficiency. Jordan and Tunisia also receive a relatively large amount of donor support in the climate and environment space compared to Algeria, Lebanon and the region’s conflict-affected countries.
• Fragile and conflict-affected countries receive little or no climate finance via the multilateral climate funds and limited bilateral support in the climate and environment space. Bilateral donors often focus on stabilisation support, including support for water resources in terms of ensuring access to water, sanitation and hygiene.
• There are some examples of projects supporting nature-based solutions. For example, a GCF coastal adaptation project in Egypt is supporting engineering with natural solutions.
• Regional and global projects support low-carbon growth, mitigation activities, access to finance, and water resources. For example, the EBRD with co-financing from GCF is supporting a programme to deliver climate finance to the private sector at scale through partner financial institutions (PFIs) across 10 countries including Egypt, Jordan, Morocco, and Tunisia
• Non-DAC donors are present. For example, the Abu Dhabi Development Fund has supported a renewable energy project in Jordan, and Korea has co-financed a small number of multilateral climate fund supported projects.