New loan options with Performance-Based Payments (PBPs) will be made available to Small and Medium-sized Enterprises (SMEs) and seven target groups of creditworthy but underserved individuals/households from North Macedonia. The loans are to be used for investments in renewable energy (RE) and energy efficiency (EE) solutions, such as: photovoltaics, heat pumps, inverters, solar panels, efficient heating systems, etc.
This was announced last week in Skopje at the “Green Finance Facility“ Product Launch, where representatives from the Government of the Republic of North Macedonia, the United Nations agencies in the country, the European Bank for Reconstruction and Development (EBRD) and local commercial banks emphasized the needs, features and benefits of these loans.
“Considering that all countries are dealing with many challenges, such as the post-covid economic recovery, the economic and energy crisis, I believe that this project with products aimed at small and medium-sized enterprises and individuals from underserved categories is an excellent opportunity to express our strong commitment to accelerating the implementation of the 2030 Agenda and achieving the Sustainable Development Goals“ - said Mr. Fatmir Bytyqi, the Deputy Prime Minister in Charge of Economic Affairs, Coordination of the Economic Departments, and Investments in the Government of North Macedonia.
As part of the package, the GFF through the partner financial institutions will provide ex-post, performance-based payments of up to 10% of the loan principal for SMEs and 30% of the loan principal in ex-post, performance-based payments for target groups of households i.e., individuals.
Within the households’ group, GFF loans are made available to the following seven target groups of creditworthy but underserved individuals/households: female-headed households, single parents, households with people with disabilities, Roma, employees affected by Covid-19, remittance recipients and returning migrants. Both SMEs and individuals/households will receive free technical advice on choosing the most appropriate renewable energy and energy efficiency solutions. These investments are expected to reduce energy consumption, reduce greenhouse gas emissions, and contribute to cleaner air in North Macedonia.
“GFF aims to bring the benefits of green transition to SMEs and groups of society who are usually the last to join and benefit from the green transition, such as single parent households, Roma, households with persons with disabilities, and recipients of remittances. I hope GFF loans will make investments in renewable energy and energy efficiency easier and more affordable for small businesses and homes“ – said Ms. Rossana Dudziak, UN Resident Coordinator in North Macedonia.
The programme is aligned with and supports the achievement of Sustainable Development Goals (SDGs) and the UN Sustainable Development Cooperation Framework (SDCF) targets. It is expected to result in 70,068 MWh of annual energy savings, 80,510 tons of CO2-eq emissions avoided, and 10.7 MW in new renewable energy capacity. Furthermore, enabling access to affordable financing for renewable energy and energy efficiency solutions will contribute to advancements towards SDGs 7 and 13.
UNECE Deputy Executive Secretary, Mr. Dmitry Mariyasin, stated: “In our view, the focus of the project on small and medium enterprises is very important because they account for up to 60 per cent of carbon emissions globally, but often lack access to climate finance or transition finance. To ensure that countries get on a trajectory to net-zero in time, we need to have SMEs on board and have financing, tools, and technologies in place”.
UNECE is providing technical assistance to the project and is in charge of designing and implementing training to support the use of eligible renewable energy and energy efficiency technologies for small and medium enterprises and households in North Macedonia.
“The EBRD is delighted for this strong partnership with the Government of North Macedonia and the United Nations which enabled the launch of this new programme. It leverages our strong relationships with local financial institutions to expand the availability of green finance to the local SMEs“ – said Ms. Aleksandra Vukosavljevic, EBRD Director, Financial Institutions, Western Balkans and Eastern Europe.
The “Green Finance Facility“ has a total value of USD 46 million and will be implemented until April 2026. It is financially supported by the Joint SDG Fund and the Government of the Republic of North Macedonia, with loan financing from the European Bank for Reconstruction and Development and local commercial banks.
“Two years ago, this project was only one of the over 150 proposals from over 100 countries worldwide, which applied for co-funding from the UN Joint SDG Fund. Amid intense competition GFF North Macedonia was selected as one of 10 programmes globally recognized for its significant impact, investment readiness, and substantial co-financing leverage“ – said Mr. Armen Grigoryan, UNDP Resident Representative in North Macedonia.
“The implementation of this innovative climate solution includes government entities, UN agencies, an international financial institution, think tanks, and private sector banks. It includes everyone. This model could be an example of partnership development that can scale up and replicate to other countries“ – said Ms. Rania Sharshr, IOM Director of Peace & Development Coordination.
The “Green Finance Facility“ project is implemented by the United Nations Development Programme (UNDP), the International Organization for Migration (IOM) and the United Nations Economic Commission for Europe (UNECE), together with the European Bank for Reconstruction and Development (EBRD).