Dutch development bank Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden N.V. (“FMO”) has partnered with Climate Fund Managers (“CFM”), World Wildlife Fund for Nature Netherlands (“WWF”) and SNV Netherlands Development Organisation (“SNV”) to manage the Dutch Fund for Climate and Development (DFCD) on behalf of the Dutch Ministry of Foreign Affairs. The Dutch Fund for Climate and Development (DFCD) enables investments in projects aimed at climate adaptation and mitigation in developing countries. The DFCD forms an important additional instrument for the Dutch government’s efforts in contributing to the Paris Agreement and the Sustainable Development Goals (SDGs).
FMO is the Lead Partner and MoFA’s direct counterpart for the DFCD. The consortium will be governed through a DFCD Advisory Board, which role is primarily to (i) monitor/report/evaluate the implementation & progress and financial & impact results of the three Facilities; (ii) act as a general forum for communication; and (iii) monitor significant trends in global climate policy & finance and assess their relevance for the DFCD.
The fund will be structured with three separate but operationally linked facilities, each with a specific sub-sector focus and role across the project lifecycle: the Origination Facility (“OF”), the Water Facility (“WF”) and the Land Use Facility (“LUF”).
Managed by WWF-NL and SNV collectively, the OF is positioned exclusively for project identification and (pre-)feasibility development activities with a cross DFCD thematic subsector focus. This window will seek to leverage the landscape strategy for activity sourcing and develop opportunities into viable business cases for the two investment windows. The OF will provide grant funding and TA for its activities.
Managed by CFM, the Water Facility will also target investments that have graduated from the OF in sectors related to water and sanitation infrastructure, as well as environmental protection. The Water Facility will contribute to the development, construction and operational phases of investments. To achieve this the Water Facility will provide development grants, equity for construction and operational debt to projects. It will utilize the proven fund structure of Climate Investor One and will target a €50 million Development Fund, a €500 million Construction Equity Fund and a €500 million Refinancing Fund. The Water Facility will also source opportunities from CFM’s external networks and will provide post-construction phase community development and TA.
Managed by FMO, the Land Use Facility targets investments that have graduated from the OF in sectors relating to agroforestry, sustainable land use and climate resilient food production. The Land Use Facility has at its disposal the full range of financial instruments oﬀered by FMO to provide growth finance to companies, including grants, equity and debt. It will also source opportunities from FMO’s external networks and will provide post-construction phase community development and TA financing.
The DFCD will be structured with three separate but operationally linked facilities, each with a unique role across the project lifecycle; each with a unique thematic sub-sector focus. The Origination Facility will identify business cases from the earliest ‘Discover’ stage and work with counterparts to ‘Structure’ projects and prove bankability. Viable projects will be offered to the two investment facilities for further development funding, core activity financing and post financing technical assistance.
The fund is operational as per Q3 2019.
Cooperation with other organizations and stakeholders will be sought in several ways.
- The consortium welcomes cooperation with project developers for pipeline-development when opportunities align with the DFCD investment strategy.
- The consortium seeks to cooperate with a diverse stakeholder base, including; civil society; (local) government; NGOs and the private sector in the landscapes we are active in.
- Private sector investors are invited to discuss partnership opportunities with the DFCD and its underlying facilities.
- The consortium may wish to partner with industry specific knowledge centres.
There will be no Calls for Proposals by any of the three Facilities.
The DFCD will focus on a set of high impact investment themes within four key Rio Marker 2 sectors all of which are critical to tackling climate change and achieving the SDGs:
- Climate resilient water systems and freshwater ecosystems: drinking water & sanitation supplies, restoration & sustainable management of wetlands, headwaters & ﬂoodplains;
- Forestry for the future: promoting aﬀorestation and reforestation;
- Boost food security with climate smart agriculture: funding more sustainable, efficient and productive approaches from smallholder farmers to agri-business;
- Protecting the environment, protecting people: restoration of ecosystems, such as wetlands and mangroves, which are nature’s best defenses against extreme ﬂoods, droughts and storm surges.
For an initial assessment of whether you project could be eligible for funding, please see ‘Contact Us‘.
- The Land Use Facility targets investments typically between EUR 1 million and EUR 7 million.
- The Water Facility may provide up to 50% of the required project development funding, typically up to EUR 2.5 million. Construction funding may typically range between EUR 5 million – EUR 100 million per investment.
Investments made by the consortium parties will seek to improve the wellbeing, economic prospects and livelihoods of vulnerable groups – particularly women and children – and, enhance the health of critical ecosystems – from water basins to rivers, tropical rainforests, marshland and mangroves. The consortium’s activities will also help protect communities and cities from the increasing frequency of extreme weather events and benefit depleting biodiversity in areas that provide people with water, food, medicine and economic opportunity.
The DFCD Consortium will measure and report on a set of impact for all activities financed with DFCD funding across the three Facilities. The indicators have been selected to reflect those identified in DGIS proposal documents, with additional definition stated where necessary to align with international best practice and strike an appropriate balance between relevance, robustness, and reproducibility.