ALP's EDGE-certified warehouses in Kenya
Climate is a strategic pillar for IFC and the World Bank Group. IFC is committed to growing its climate-related investments to an annual average of 35 percent of its own-account long-term commitment volume between 2021 and 2025 and working with financial institutions to finance projects that will support mitigation and adaptation.
IFC is the largest development finance institution supporting the private sector in emerging markets, and our Climate Business work allows us to invest directly and partner with financial institutions in climate-smart sectors. We collaborate with governments, the private sector, financial institutions, and other development banks in an effort to increase climate-related investments.
IFC partners with financial institutions to deploy capital, mostly in the form of loans to businesses and other organizations, to implement climate-friendly projects. Read about our comprehensive approach to Greener Banking & Transformation.
There are well over $30 trillion dollars worth of climate-smart investment opportunities in emerging markets. Financial institutions will need to provide the majority of the capital for these opportunities, helping enable the transition to a low-carbon global economy. We estimate that financial institutions must grow the share of climate-friendly projects in their portfolios from an average of 7 percent in 2016 to 30 percent by 2030 to finance the greening of the economy. That equates to an increase from approximately $1.5 trillion to $13.4 trillion, a growth opportunity too big for banks to miss.
Since 2005, we have committed $7.8 billion from our own account and leveraged an additional $3.8 billion through our 200-partner emerging-market financial institutions. These investments support partners in avoiding GHG emissions of 14.8 million tons per year. In partnership with IFC, our client financial institutions have built climate finance portfolios of $26.7 billion, avoiding annual GHG emissions of 85.5 million tons. This is the equivalent of taking approximately 18 million cars off the road every year, or of erasing the annual emissions of a country the size of Greece.
The impact of IFC's climate-finance clients:
*Data as of March 2020