Non-Grant Instruments

Drawing on its experience in utilizing debt, equity and risk mitigation products in the past, the GEF has launched a launched a $110 million pilot program in GEF-6 to demonstrate and validate the application of non-grant financial instruments to combat global environmental degradation.

The GEF offers attractive financial terms for both public and private sector recipients as follows:

Financial terms for private sector:

  • Flexible concessional interest rate;
  • Minimum level of concessionality to avoid displacing other finance;
  • First-loss position if justified;
  • Maximum maturity of 20 years;
  • Flexible exit date for equity investments.

Financial terms for public sector (LDCs/SIDS and Other Recipient Countries):

  • Grace period of 10 years;
  • Interest rate of 0.25% or 0.75%;
  • Maximum maturity of 40 or 20 years;
  • Principal repaid in equal annual payments after grace period.

The resources can be used for projects that deliver global environmental benefits in one or several of GEF’s areas of work, including biodiversity, climate change, international waters, land degradation and chemicals and waste management. The funding size is flexible and expected to range up to approximately $15 million per project.

Proposals are especially encouraged if they: (i) demonstrate innovative private and public sector application of financial mechanisms, business models, partnerships and approaches for achieving the objectives of the GEF-6 strategies that may be broadly adopted and can be scaled up; (ii) entail high levels of co-financing and focus on areas other than climate change.

The GEF invites private and public sector recipients to propose projects through eligible GEF Partner Agencies in two phases:

PHASE I: Three innovatives projects were selected in Phase I of GEF-6.

PHASE II: Proposals for Phase II were submitted in the Fall 2015 for Council decision in November 2015.

Further details on the $110 million Non-Grant Pilot can be found in GEF Council document GEF/C.47/06/Rev.01, GEF-6 Non-Grant Instrument Pilot and Updated Policy for Non-Grant Instruments;

Eligible GEF Partner Agencies can submit project proposals on behalf of private and public sector recipients to the GEF.  Here is the list of all 14 GEF Partner Agencies; 

Applications for the $110 million Non-Grant Pilot follow the procedures described in the GEF Council document GEF/C.42/Inf.08, Operational Modalities for Public Private Partnership Programs

For further information, please contact an eligible GEF Partner Agency or the GEF Secretariat:

GEF Agencies Focal Points for NGI (click to see list)