In May 2014, in response to Policy recommendations for the GEF 6th Replenishment, the GEF Council approved a Co-financing Policy (see link below), which applies to projects and programs financed with resources from the GEF Trust Fund and the Nagoya Protocol Implementation Fund (GEF-financed projects). It does not apply to projects financed with resources from the Least Developed Countries Fund (LDCF) or the Special Climate Change Fund (SCCF).
The policy (i) establishes the objectives for co-financing in GEF-financed projects; (ii) defines co-financing in GEF-financed projects; and (iii) sets forth the general principles and approaches for co-financing in GEF-financed projects, including how co-financing will be monitored and evaluated.
The policy notes that an objective of the GEF, working with its partners, is to attain adequate levels of co-financing as a means to:
- enhance the effectiveness and sustainability of the GEF in achieving global environmental benefits; and
- strengthen partnerships with recipient country governments, multilateral and bilateral financing entities, the private sector, and civil society.
The policy defines co-financing as “resources that are additional to the GEF grant and that are provided by the GEF Partner Agency itself and/or by other non-GEF sources that support the implementation of the GEF-financed project and the achievement of its objectives.”
The policy notes that co-financing is required for all GEF full-size projects (FSPs), medium-side projects (MSPs), and GEF programmatic approaches. Co-financing is optional for GEF enabling activities. It notes that requirements for GEF Agencies and the GEF Secretariat during project review and approval and project monitoring.
Background Document: Council Document (GEF/C.46/09)