In line with the call for a new global financing pact issued at the Paris summit, the European Investment Bank (EIB) has pledged to step up its support for countries in the Global South and to join innovative mechanisms to accelerate a fair energy transition in developing countries.

The EIB has also agreed with the European Commission to strengthen their existing cooperation on most initiatives implemented worldwide as Team Europe under the EU's Global Gateway investment strategy. The goal is to increase investment in key sectors such as energy transition and healthcare and to develop new tools to support low- and middle-income countries in tackling the effects of climate change.

The two institutions will work together to help address existing and potential debt problems and enable vulnerable countries to implement ambitious climate measures. EIB Global is the EIB Group's branch outside the borders of the European Union.

EIB President Werner Hoyer: “The European Investment Bank has come to Paris with concrete proposals. We will work on pilot projects to incorporate climate-resilient debt clauses into our financial agreements (clauses are terms included in any type of contract, agreed upon freely by the parties in accordance with the law). We are an active partner in the IMF Resilience and Sustainability Trust. We will support a partnership with Senegal for a fair energy transition, which is part of the European Union's offer. We are pleased to be the lead institution for the Global Green Bond Initiative. And, as all sustainable development goals are linked, we have joined the new World Health Organization (WHO)-led investment platform for primary healthcare. These announcements reflect the EIB's full commitment as the EU bank to promoting global development and partnership.”

EIB Vice-President Ambroise Fayolle, responsible for climate change and development, added: “Global challenges are increasing the pressure on the most vulnerable countries, which are also the ones suffering most from the impacts of climate change. As we approach the mid-point of the 2030 Agenda for Sustainable Development, we must increase our support for countries at the forefront of climate change. Our cooperation and the instruments we are developing with the European Commission are directly aligned with the goals of this Paris summit and are designed to enable our partners to tackle the interconnected challenges of development and climate change.”

EIB Vice-President Thomas Östros commented: “The close cooperation between the Rwandan government, the IMF, international funding partners and the EIB clearly shows that joining forces in international partnerships is the most effective way to make progress in solving the climate crisis. This initiative demonstrates the EIB's firm commitment to addressing the climate change problem and supporting sustainable development in Rwanda and many other countries where this innovative approach to financing can be replicated.”

European Commissioner for International Partnerships Jutta Urpilainen: “Climate change is hitting low- and middle-income countries particularly hard. We are all falling behind on achieving the Sustainable Development Goals by 2030, and inequality is on the rise. As the world's largest provider of public climate finance, the EU and its Member States are fully committed to supporting their international partners and working multilaterally to achieve the goals set at the Paris summit. The instruments we are developing with the EIB will provide partner countries with the necessary flexibility in financing and promote 'green' investment through Global Gateway to narrow the investment gap.”

The European Union's commitment is a key element in the EU's response to the call from the Bridgetown Initiative, supported by Barbadian Prime Minister Mottley, which calls for decisive action to reform the global financial architecture and address debt instability, including through climate-resilient debt clauses. These clauses included in financial agreements will offer debt deferral in specific emergency situations caused by climate change and natural disasters in vulnerable countries. They may apply to severe extreme weather shocks (tropical storms, drought, floods, landslides) or natural disasters (tsunami or earthquake).

This will be implemented through pilot projects in Least Developed Countries (LDCs) and Small Island Developing States (SIDS).

The clauses provide an option for borrowing countries, subject to conditions, to defer debt servicing for a limited period and to repay these amounts as part of future amortization payments during the original term of the loan.

The EIB will also offer longer-term sovereign loans with a European Commission guarantee if justified by concessional needs. These could extend the term to 30 years and the repayment period to 10 years, potentially even beyond the economic life of the project.

Commission President von der Leyen announced at the Paris summit that the EIB would be the lead institution for the Global Green Bond Initiative.

Together with many European development finance institutions, the European Commission and the United Nations, the European Investment Bank is establishing an investment fund of one billion euros to support partner countries in their transition to a green economy and to mobilize fifteen to twenty billion in green investment over its lifetime. Green bonds are an effective way to attract private sector funding.

Rwanda

Team Europe and partners are initiating an additional 300 million euros in funding to attract private investment in Rwanda and increase resilience to climate change following an agreement with the International Monetary Fund on a Resilience and Sustainability Facility.

Barbados

The Barbadian government is building a coalition of multilateral banks and organizations to develop resilient infrastructure and promote new social and natural capital investments, based on its Resilience and Sustainability Facility with the IMF. The EIB and Barbados are committed to working more closely together, including by providing an additional 10 million euros for health resilience, complemented by a European Commission budget guarantee to support primary healthcare worldwide.

Senegal

Senegal and the International Partners Group (France, Germany, the United Kingdom, Canada and the EU) announce a Just Energy Transition Partnership (JETP), combining climate and development goals.

Background information:

About the European Union (EU)

The European Union is an economic and political union of 27 European countries. It is founded on values of respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of persons belonging to minorities. It acts globally to promote the sustainable development of societies, the environment and economies so that everyone can benefit.

Global Gateway is the European strategy to foster smart, clean and secure links in digital, energy and transport sectors, as well as to strengthen health, education and research systems around the world. Through the Team Europe approach, Global Gateway brings together the EU, its Member States and their financial and development institutions to mobilize the private sector and attract investment for transformative impact. It aims to mobilize up to 300 billion euros in investment by 2027. Global Gateway is fully aligned with the UN 2030 Agenda and its Sustainable Development Goals, as well as the Paris Agreement.

EIB Global is the European Investment Bank Group's specialized division for operations outside the EU and the main partner in the EU's Global Gateway strategy. It aims to support at least 100 billion euros in investment by the end of 2027, which is about one-third of the Global Gateway total target. Within Team Europe, EIB Global fosters strong and targeted partnerships with other development finance institutions and civil society. EIB Global brings the group closer to local communities, companies and institutions through its offices around the world.