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The announcement comes as business leaders gather in Brazil ahead of the COP30 climate talks with countries being urged to do more to close a UN-estimated finance gap of $300 billion a year, including by billionaire investor Bill Gates. Sign up here. As extreme weather events such as floods and droughts increase in intensity, the GAIA Climate Loan Fund would primarily aim to back projects that help countries build resilience. "Adaptation Finance is a topic that has been on the rise at the last few COPs," said Ariane Pevide, Director, Climate and Blended Finance at MUFG, in emailed comments. "We hope that the close of GAIA will strengthen the argument for private sector capital, focused on adaptation as a blueprint for the market." FinDev Canada, Canada's development finance body, and the Green Climate Fund, the world's biggest dedicated climate fund, also provided investments and the fund aims to grow to $1.5 billion. "We are in discussions with impact-minded institutional investors, including insurance companies, pension funds and family offices, to reach the target size," said Amit Mohan, Head of Private Credit at Climate Fund Managers, which runs the fund. The fund works by providing long-term loans to sovereign, sub- and quasi-sovereign and state-owned entities across 19 countries, the founders said in a statement. At least 70% of the money will go to adaptation projects, such as sustainable agriculture and water management, with the rest on mitigation efforts such as renewable energy. Once fully deployed, it aims to benefit 19 million people and create more than 11,000 jobs, avoiding 30 million tons of greenhouse gases a year. Reporting by Simon Jessop; Editing by Toby Chopra Our Standards: The Thomson Reuters Trust Principles., opens new tab Simon leads a team tracking how the financial system and companies more broadly are responding to the challenges posed by climate change, nature loss and other environmental, social and governance (ESG) issues including diversity and inclusion.
