Green Climate Fund reforms increase funding capacity by more than USD 4 billion for new climate investments in developing countries.
SONGDO, Republic of Korea — Executive Director Mafalda Duarte announced today that instituted efficiency reforms are expected to increase the Green Climate Fund’s (GCF’s) capacity to finance new projects by an additional USD 4 billion, starting from its next Board meeting in October, 2026. This enhanced funding capacity follows a Board decision adopted earlier this month relating to the management of GCF’s balance sheet, which allows for greater investments based on existing resources.
The new methodology forms part of the reform agenda introduced by Executive Director Duarte to enhance GCF’s efficiency and impact. Under the historical approach, USD 1.37 billion of funding would have been available for new projects in the second half of 2026 and 2027. Under the refined approach, the Secretariat has determined that approximately USD 5.65 billion will be available for new programmes and projects — an increase of more than USD 4 billion from the same balance sheet capacity — assuming a similar portfolio composition and deployment of financial instruments as from 2015-2025.
The change is expected to be achieved while maintaining GCF’s unique risk profile and high degree of concessional finance, which supports the Fund’s objectives to ensure that: (1) over half its finance is directed towards adaptation, with the majority invested in Least Developed Countries (LDCs), Small Island Developing States (SIDS), and African States; and (2) private sector investments are catalyzed and new markets are created.
“This reform allows us to manage GCF’s balance sheet much more efficiently while preserving the unique concessional and risk profile of GCF in the financial system that allows us to do what others can’t with the largest network of partners both from the public and private sectors,” said Mafalda Duarte.
“We intend to put these resources to work over the next two years. Importantly, we expect that this USD 4 billion will unlock at least three times that amount in co-finance, resulting in an additional and much needed USD 16 billion worth of investments in the short term that will make countries and communities more resilient to the impacts of climate change, promote energy-food-water security, catalyze private sector investments and create jobs.”
For contributors to GCF, this change is expected to enhance the climate impact of every dollar invested in GCF. Going forward, every USD 1 contributed to GCF will now support approximately USD 1.30 in new funding to projects in developing countries, increasing the Fund’s impact.
For beneficiary countries, this translates to greater amounts of urgently needed investments, while GCF maintains its unique concessionality and risk appetite, which remains a key enabler of its transformative impact.
About the Green Climate Fund
GCF is the world’s climate fund for developing countries, mobilising and delivering capital at scale, strengthening institutions and supporting transformative change, and bringing together its extensive partnership networks to deliver impact. GCF is mandated as the primary operating entity of the financial mechanism of the United Nations Framework Convention on Climate Change (UNFCCC) and serves the 2015 Paris Agreement.
To fulfill its role in supporting global climate ambition, GCF is focused on delivering high-impact climate finance at scale, underpinned by a country-owned approach focused on system-wide change. The Fund has over USD 20 billion committed across 134 developing countries through a wide range of adaptation and mitigation projects.
Green Climate Fund Press Release
