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Multilateral Development Banks’ (MDBs) Climate Finance Rose to $66 Billion in 2020, Joint Report Shows

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climate change - Investors King

MDBs publish 2020 Joint Report on Multilateral Development Banks’ Climate FinanceEight MDBs committed $66 billion for climate finance in 2020, up from $61.6 billion; Of the total, 58 per cent was committed in low- and middle-income countries.

Climate finance committed by major multilateral development banks (MDBs) rose to a total of $66 billion last year from $61.6 billion in 2019, according to the 2020 Joint Report on Multilateral Development Banks’ Climate Finance, published today. Of this, 58 per cent – or $38 billion – was committed to low- and middle-income economies.

The total climate co-finance committed during 2020 alongside MDB resources was $85 billion. Together, MDB climate finance and climate co-finance totalled more than $151 billion. The amount of private direct mobilisation stood at $5.9 billion.

Accelerating the transition to low-carbon and climate-resilient economies through climate finance is a key element of the MDBs’ effort to align their activities with the objectives of the 2015 Paris Agreement to keep global warming well below 2°C, with efforts to limit it to 1.5°C, along climate-resilient development pathways. In the past six years, the MDBs have jointly committed a total of $257 billion in climate finance, of which $186 billion was directed at low- and middle-income economies.

The annual report is a key indicator on the progress MDBs are making on accelerating the delivery of climate finance, for which demand is clearly going to grow over time. This year’s report marks the end of the reporting period tracking individual climate finance pledges since 2015; for most, 2021 will mark the start of a new increase in ambition. In 2019, at the UN Secretary-General’s Climate Action Summit, MDBs announced their expected joint annual climate action finance to 2025. These include at least $65 billion, with $50 billion of MDB climate finance for low-income and middle-income countries; an increase in adaptation finance to $18 billion; and private direct mobilisation of $40 billion.

“The MDBs will continue to improve their tracking and reporting of climate finance in the context of their commitments to ensure consistent financial flows to the countries’ long-term, low-carbon and climate-resilient development pathways, as established in Article 2.1 of the Paris Agreement,” says the 2020 report, which is the tenth in the series.

Of the 2020 total of $66 billion, $63 billion came from the MDBs’ own accounts and almost $3 billion from external resources channelled through and managed by MDBs. These included the Climate Investment Funds (CIF), Green Climate Fund (GCF) and climate-related funds under the Global Environment Facility (GEF), EU blending facilities and others.

“The African Development Bank’s share of climate change related investments has increased four-fold from 2016 to 2019 and is expected to reach 40% of the Bank’s total investment at the end of 2021,” said Mr. Al-Hamndou Dorsouma, Officer-In-Charge Director of Climate Change and Green Growth at the African Development Bank. “We are on track to mobilize the target of $25 billion between 2020 and 2025 to support investments that address climate change and promote green growth,” he added.

The 2020 financing helped play a key role in supporting countries to embed green and climate-focused solutions as part of their recoveries from the impact of COVID-19. While these programmes affected MDBs’ normal lending operations and thus the delivery of their climate finance targets, seeing the total commitments for low- and middle-income countries dip from 2019’s $41.5 billion, the 2020 report says interventions and support from the MDBs laid a solid foundation for “building back better” for a greener, more resilient, post-Covid-19 future.

Nearly $50 billion (76 per cent) of total MDB climate finance in 2020 was associated with climate change mitigation investments that aim to reduce harmful greenhouse gas emissions and slow down global warming. Of this, 50 per cent went to low- and middle-income economies.  More than $16 billion (24 per cent) for climate change adaptation finance was invested in adaptation efforts to help countries build resilience to the mounting impacts of climate change, including worsening droughts and more extreme weather events, from flooding to rising sea levels. Of this, 83 per cent was directed for low- and middle-income economies.

Is the CEO and Founder of Investors King Limited. He is a seasoned foreign exchange research analyst and a published author on Yahoo Finance, Business Insider, Nasdaq, Entrepreneur.com, Investorplace, and other prominent platforms. With over two decades of experience in global financial markets, Olukoya is well-recognized in the industry.

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Finance

CBN New Policy Boosts Nigeria’s Economy and Increases FX Reserve to Over $40 Billion

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Dr. Olayemi Michael Cardoso

In celebration of one year in office, the Central Bank of Nigeria (CBN), under the leadership of Olayemi Cardoso, has recorded another milestone with an over $40 billion increase in Nigeria’s foreign exchange reserves.

The announcement of the increase was made on Thursday by Cardoso during a symposium in Abuja titled Promoting Stability in an Era of Economic Reforms: The Journey So Far.

It was noted that the increase followed a policy of reform implemented by the administration of Cardoso as the CBN Governor to address Nigeria’s decade-long challenges with declining foreign direct investment and portfolio investments. 

It was gathered that, to further strengthen the nation’s economy, the CBN increased monthly foreign remittances to $1 billion by establishing new operational guidelines for Bureau de Change operators.

“According to Governor Cardoso, the reforms have started to yield positive results, including marked improvements in the FX market and a stabilization of foreign reserves, which have now surpassed the $40 billion mark, the highest in 33 months,” the statement read.

“While noting that inflation remains elevated, he said it is on a downward trend, signaling that the reforms are taking hold in restoring market equilibrium and fostering growth,” the statement added.

Additionally, the CBN had raised the Monetary Policy Rate by 850 basis points to 27.25% and also increased the Cash Reserve Ratio for commercial banks to 50%.

It was gathered that the previous administration had created arbitrage opportunities and discouraged foreign investment. 

In a way to correct these issues, the present administration has streamlined Nigeria’s foreign exchange system and eliminated multiple exchange rates to reduce delays in foreign exchange settlements and prevent revenue losses that had reached 6.2 trillion Naira in 2022. 

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Banking Sector

NDIC Issues Fresh Directives to Unpaid Heritage Bank Customers, List Requirements for Refund

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The Nigeria Deposit Insurance Corporation (NDIC) has issued fresh directives to customers of the defunct Heritage Bank who are yet to receive the refund of their money deposited in the bank.

The managing director of NDIC, Bello Hassan, through the director of communications and public affairs, Nuhu Bashir, issued the fresh directive during the corporation’s ‘special day’ event at the 36th Lagos International Trade Fair.

Urging unpaid customers to come forward, Hassan said that the requirements needed to claim a refund include the customer’s BVN, proof of account ownership, and alternative account details.

He detailed that affected customers can process their claims via the NDIC website, email, and social media platforms.

Highlighting the corporation’s role in liquidating Heritage Bank and facilitating the ongoing recovery and refund of depositors’ funds, Hassan stated, “Depositors who are yet to receive their payment should come forward with their BVN, proof of account ownership, identification, and alternative account details.”

NDIC reaffirmed its commitment to protecting depositors and ensuring financial stability.

“Our mandate is to safeguard depositors and ensure financial stability,” he stated.

Hassan assured customers that banks that are still in operation are safe saying, “All banks with active licenses from the CBN are safe and healthy,” Hassan said.

He pledged the corporation’s commitment to providing a safe and stable financial environment for Nigerians.

According to him, a stable financial environment will boost public confidence in financial institutions and enable businesses to thrive.

He stated, “The NDIC is committed to ensuring a stable financial environment that safeguards depositors and builds public confidence, enabling businesses to thrive and contribute to our nation’s economic development.”

Gabriel Idahosa, the president of the Lagos Chamber of Commerce and Industry (LCCI) praised the NDIC for its vigilant monitoring of banks and its proactive intervention in distressed institutions.

Idahosa said, “The corporation’s vigilant monitoring of banks, proactive intervention in distressed institutions, and ongoing commitment to depositor protection have instilled confidence in the banking sector.

“These ensure that banks can continue to serve businesses and individuals even in uncertain economic times.

“Its unwavering commitment to depositor protection and financial stability has been vital in navigating recent economic challenges and safeguarding the integrity of Nigeria’s banks.”

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Banking Sector

Zenith Bank Commends Customers After Successfully Unveiling Upgraded Enhanced Tech infrastructure

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Zenith Bank - Investors King

Zenith Bank Plc has announced that it now boasts the best technology infrastructure in the banking industry, positioning itself to provide an exceptional customer experience and superior service delivery moving forward. This upgrade follows a recent comprehensive technology enhancement.

The bank expressed its heartfelt gratitude to customers for their support and patience throughout the upgrade process, while also extending apologies for any inconveniences experienced during this time.

This announcement was made in a social media post on Wednesday, signed by Dame Dr. Adaora Umeoji, OON, the Group Managing Director/CEO.

In her message, the GMD/CEO emphasized the bank’s commitment to delivering an unparalleled service experience, stating, “We undertook this upgrade to ensure we can offer our customers the best possible service.”

Umeoji pledged that Zenith Bank will continue to innovate, ensuring that customer needs are met swiftly, safely, and conveniently.

The post read in part: “On behalf of the Board, Management, and Staff of Zenith Bank PLC, I would like to thank you for your patience and support during our IT infrastructure migration to a new and more robust operating system.

“We are truly grateful for the trust and confidence you have placed in us. The primary reason for undertaking this extensive endeavor was to better position Zenith Bank PLC for improved service delivery to all our valued customers and to create memorable banking experiences at all our touchpoints.

“While I regret the inconveniences and challenges you faced during and immediately after our migration, I am pleased to inform you that Zenith Bank PLC now has the best technology infrastructure in the industry. We are committed to ensuring you experience superior service delivery going forward.

“Rest assured, you remain our top priority, and Zenith Bank will continue to innovate and offer value-added products and services to meet all your banking needs quickly, safely, and conveniently.”

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