The European Bank for Reconstruction and Development (EBRD) and the European Union (EU) have jointly launched the nation’s first Green Economy Financing Facility (GEFF).
The new programme aims to strengthen the competitiveness of Tunisian businesses while accelerating the country’s transition to an environmentally sustainable economy. A core component of the initiative is the provision of €59 million in senior loans to up to six local financial institutions. These funds will be on-lent to micro, small, and medium-sized enterprises (MSMEs) for investments in green technologies.
“Tunisia’s updated climate targets are ambitious, and the private sector is key to achieving them,” said an EBRD representative. “This facility provides the capital and the technical support for businesses to modernize, cut costs, and reduce their environmental footprint simultaneously.”
The financing will specifically target projects in renewable energy, energy efficiency, climate adaptation, and the circular economy. To mitigate financial risk for local banks, the programme, with support from the Currency Exchange Fund (TCX) and the EU, will provide a foreign exchange hedging mechanism at reduced pricing.
The initiative arrives at a critical time. Over the past three decades, Tunisia has experienced a rise in greenhouse gas emissions, largely driven by energy-intensive industrial growth. In 2021, the country updated its national climate plan, committing to a 45 per cent reduction in carbon intensity by 2030.
The GEFF is designed to directly support this goal by enabling smaller businesses to invest in climate-friendly technologies. The EBRD estimates these investments will lead to a reduction of more than 26,000 tonnes of carbon dioxide emissions annually.
Beyond financing, the programme includes a comprehensive technical cooperation package funded by the EBRD and the EU. This package will build the capacity of partner banks and promote equal access to green finance for women-led businesses. Furthermore, end-borrowers who successfully adopt high-performance technologies will receive EU-funded investment incentives.
Globally, the GEFF network operates in 29 countries through 191 financial institutions. To date, it has channeled €6.3 billion in EBRD finance, enabling over 231,000 green projects and avoiding 10 million tonnes of CO2 emissions each year.
Since commencing operations in Tunisia in 2012, the EBRD has invested more than €2.78 billion in 83 projects across the country, with a majority (66%) directed toward the private sector.
TunisianMonitorOnline (CBR)
