The Development Bank of Namibia (DBN) and KfW Development Bank have signed a second concessional loan of approximately N$600 million.
The loan will be utilized for the development of climate-related infrastructure projects, including those focused on renewable energy, water, and low-carbon transport.
The funding is in addition to the approximately N$240 million agreement signed in December 2018, which was successfully utilized to support private companies in establishing solar photovoltaic infrastructure.
“The new credit line will provide long-term financing to enable DBN to offer private and public investors incentivized conditions for climate-related infrastructure projects.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 moving ahead with the financing,” said DBN CEO Martin Inkumbi.
He emphasized that access to affordable financing is a key element for the realization of climate-related infrastructure projects. He noted that the Bank is not only aware of the need for infrastructure that reduces emissions but also for climate adaptation, given the threats of heat and drought to Namibia.
Both financial institutions noted that financing for mitigation and adaptation to climate change is rapidly growing, both globally and 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.”
Meanwhile, KfW Country Director, Beatrice Lucke, emphasized DBN’s main objective of contributing to economic growth and social development in Namibia.
“This can be achieved by attracting investment in green and transformative infrastructure, which is the basis for any sustainable development around the world. I, therefore, hope the concessional loan can be used to finance projects that maximize these objectives,” she said.
Inkumbi expressed appreciation to KfW and the German Government for the relationship that aims to provide solutions to climate challenges, adding that the funding would provide the Bank with additional leeway to further develop and refine models and options.
He said that this would assist in growing the Bank’s portfolio of projects to address climate change and adaptation, positioning the DBN as the ‘national and regional climate bank’.
