Hungary to launch climate finance instrument to support green transition in Western Balkans

The Hungarian Government has approved the establishment of the Western Balkans Green Center (WBGC), a new instrument to support green transition in Albania, Bosnia and Herzegovina, Kosovo*, Macedonia, Montenegro, and Serbia. This is the first step of a broader, more ambitious endeavor, to create a regional multi-donor fund in 2021.

Designed with the support of the Global Green Growth Institute (GGGI) under a cooperation project supported by the Ministry for Innovation and Technology of Hungary, the WBGF will support climate actions in six countries: Albania, BiH, Kosovo*, Macedonia, Montenegro, and Serbia, the GGGI said in a press release.

The Government Decision calls for the set-up of a state-owned company, including financial provisions for the next three years.

According to the GGGI, the WBGF will be complementary to existing instruments and will target areas that are under-financed such as climate adaptation.

As early as 2019, the WBGC will support project preparation and capacity building in the region through grant financing in water management, forestry, sustainable energy for buildings and sustainable city sectors, the press release reads.

The WBGC is the first step of a broader, more ambitious endeavor, to create a regional multi-donor fund in 2021 supporting project implementation, using blended finance and targeted financial instruments for beneficiaries in Western Balkans.

The Government proposal also calls for the set-up of an international committee and further engagement with the Visegrad and other Central European countries for the establishment of the regional multi-donor fund in 2021.

WBGC to support green infrastructure investments – Ban Ki-moon

“The project will help the region meet its objectives under the Paris Agreement. I see a critical role for this Hungarian initiative in supporting green infrastructure investments. GGGI estimates that every USD 100,000 in project preparation funds during the Fund’s first phase may mobilize USD 10 million in infrastructure investments,” Ban Ki-moon, President and Chair of the GGGI, said.

Peter Kaderjak, Secretary of State for Energy Affairs and Climate Policy, said that the Hungarian Government in collaboration with the GGGI intends to support the green transition of the Western Balkan region through a dedicated fund.

The project will result in concrete actions to support climate mitigation and adaptation in the neighboring region, he said.