The Royal Government of Cambodia (RGC) has shown unwavering commitment to tackling climate change, recognizing its significant impact on socio-economic well-being and the environment. Since joining the UNFCCC in 1996 and formulating ambitious Nationally Determined Contributions (NDC) in 2020, Cambodia has dedicated itself to reducing emissions and enhancing adaptive capacities.

However, securing the necessary funds remains challenging, with estimated costs exceeding USD 5.8 billion for mitigation and USD 2 billion for adaptation. To address this, the Ministry of Environment (MOE) and Global Green Growth Institute (GGGI) launched a 24-month project titled “Capacity Building and Accreditation Support of Direct Access Entity to Private Banks for On-Lending and/or Blending Fiduciary Functions,” funded by the Green Climate Fund (GCF), to mobilize climate finance.

This project represents extensive advocacy, collaboration, and strategic planning to empower Cambodia in climate finance. Focusing on capacity building, strategic frameworks, and knowledge sharing, the project aims to equip stakeholders—financial institutions, government bodies, and private sector entities—with the expertise to mobilize climate finance and implement climate-resilient initiatives.

The MOE has selected three banks—Foreign Trade Bank of Cambodia (FTB), ACLEDA Bank Plc. (ACLEDA), and Advanced Bank of Asia Limited (ABA)—and the National Council for Sustainable Development (NCSD) for capacity-building support. The goal is to enhance capabilities and submit an accreditation application to the GCF for Direct Access Entity (DAE) approval during the project.

Support at least 1 nominated Direct Access Entity in the preparation and assessment of all documents for submission of the GCF accreditation application.

The Royal Government of Cambodia (RGC) has prioritized climate action, setting a target in its 2020 Nationally Determined Contribution (NDC) to reduce emissions by 27% by 2030, focusing on energy, transport, manufacturing, and building energy efficiency. Achieving these goals requires substantial financial resources, with estimated costs over USD 5.8 billion for mitigation and USD 2 billion for adaptation. However, Cambodia faces significant barriers in mobilizing climate finance due to the absence of a national accredited entity for on-lending and blending fiduciary functions, limited stakeholder capacity, and insufficient knowledge of climate finance mechanisms. This project aims to overcome these barriers by enhancing institutional capacity and facilitating access to climate finance.

Following the Ministry of Environment’s reference number 1484 dated 21st July 2023, three banks have been selected to receive capacity-building support through this readiness project. The project aims to enhance the capacity, policies, and tools necessary for effective climate finance mobilization, the implementation of climate-resilient initiatives, and the preparation of accreditation applications to the Green Climate Fund (GCF) for approval as Direct Access Entities (DAE). The ultimate goal is to submit an accreditation application from one of these candidates to the GCF during the project’s implementation phase. This two-year project is funded by the Green Climate Fund (GCF).