The Development Bank of Namibian (DBN) and KfW Development Bank have signed the second concessional loan of around N$600 million (translating to €30 million) to be used for development of climate-related infrastructure, such as renewable energy, water and low-carbon transport projects.
Financing mitigation and adaptation to climate change
Climate-appropriate financing is fast-growing – not only globally but also in Namibia. The DBN addresses this much needed financing in the local market with the support of the German Development Cooperation. DBN’s portfolio of climate-mitigating projects encompasses infrastructure projects for solar photovoltaic and wind generation as well as rural and urban water infrastructure and public transport projects.
The new credit-line will provide long-term finance to enable DBN to provide private and public investors incentivized conditions for climate-related infrastructure projects. It follows the first credit-line amounting to approximately N$240 million signed in December 2018, which was successfully placed in the market primarily assisting private companies to set up solar PV infrastructure.
Enhancing sustainable investment
At the signing ceremony, KfW Country Director, Beatrice Lucke, congratulated the DBN saying “The DBN’s main objective to contribute to economic growth and social development in Namibia will increasingly be achieved by attracting investment in green and transformative infrastructure which is the basis for any sustainable development around the world.” She hopes that the concessional loan can be used to finance projects that maximize these objectives.
DBN CEO, Martin Inkumbi, said that the Bank has built up a significant project pipeline for eligible projects particularly in the Renewable Energy space over the past years and is looking forward to ultimately move ahead with the financing. He added that access to affordable financing is a key element for realization of climate related infrastructure projects and that the Bank is not just aware of the need for infrastructure that reduces emissions, but also for climate adaptation in light of the threats of heat and drought to Namibia.
Inkumbi expressed his appreciation to KfW and the German Government for the relationship that aims at providing solutions to climate challenges and said that the funding would provide the Bank additional leeway to further develop and refine models and options. This would assist in growing the Bank’s portfolio of projects to address climate change and adaptation and position the DBN as the ‘national and regional climate-bank’.