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France, Germany join BlackRock for climate investment
DAVOS, Switzerland, Jan 22, 2020 (BSS/AFP) – France, Germany announced on
Wednesday that they are joining forces with investment giant BlackRock to
speed up attracting capital to invest in projects fighting against climate
change in developing countries.
The Climate Finance Partnership (CFP) brings together BlackRock, the
world’s biggest asset manager, France’s development agency AFP, the German
environment ministry, and a number of private foundations.
The plan was announced on the sidelines of the annual World Economic Forum
(WEF) in Davos, where private sector players and governments are under
increasing pressure to show they are serious about reversing global warming.
BlackRock already announced last week it is divesting holdings in
companies that generate more than a quarter of their sales from thermal coal
production.
The CFP aims “to mobilise top-tier institutional capital investment into
climate-related sectors in emerging markets, at scale,” the parties said in a
statement.
The investments will be targeted towards countries in South East Asia,
Latin America, and crucially Africa, which will account for at least 25
percent of the total capital invested.
Projects could include renewable energy, energy efficiency in homes and
offices, energy storage and electric transport, a statement said.
– ‘Creative collaboration’ –
“The unique challenges posed by climate change call for stronger joint
action,” said Remy Rioux, the CEO of the French development agency AFD.
It will “help redirect financial flows towards sustainable development
investments across the emerging world, and will include a priority focus on
Africa,” he added.
There will be an initial investment of at least $100 million and then
BlackRock will mobilise a goal of at least $400 million in institutional
private equity capital commitments.
“This would result in a minimum size of $500 million at first close and
CFP parties share a collective goal of further scaling the vehicle going
forward,” the statement said.
France and Germany intend to contribute $30 million each to the
partnership. In addition, The William and Flora Hewlett Foundation and the
Jeremy and Hannelore Grantham Environmental Trust have committed $10 million
and $7.5 million respectively.
The CFP, a project initially announced in September 2018, is the first
vehicle focused on climate infrastructure investments in emerging markets of
BlackRock,
“We believe creative collaboration is essential to mobilising investment
into climate infrastructure in emerging markets at scale, providing our
clients with further opportunity to invest in the global low-carbon
transition,” said Brian Deese, Global Head of Sustainable Investing at
BlackRock.
BSS/AFP/RY/13:55 hrs