IIC Hosts Panel Discussion On Banking And Climate Change At The 41st FELEBAN Annual Assembly

11/06/2007

The focus was on carbon finance opportunities and risks for the private sector in Latin America

Miami, Florida – On November 6, 2007, during the 41st FELABAN Annual Assembly, the Inter-American Investment Corporation (IIC) hosted a panel discussion on Banking and Climate Change: Carbon Finance Opportunities and Risks for the Private Sector in Latin America. The enormous investments needed to reach a sustainable level of greenhouse gas emissions, which some experts estimate to be 1% of the world's GDP, require that traditional banks play a more active role in financing efficient energy projects and reducing emissions under the Clean Development Mechanism. The panelists explained how banks can benefit from such projects, as well as the specific risks of entering the carbon finance market.

The panel comprised a select group of carbon finance experts with wide-ranging experience in structuring and developing carbon finance transactions in Latin America. The panel moderator was Ms. Sarah Fandell, IIC General Counsel, who also explained how to take carbon credit cash flows into consideration when structuring bankable projects. The other panelists were Mr. Miguel Albero, Managing Director of Santander Investment, based in Madrid; Ms. Ana Cecilia Fazoli, Finance and Operations Manager of MGM International Group, based in Miami; and Ms. Charlotte Streck, Director of Climate Focus, based in Rotterdam.

The panel highlighted the experience of the IIC and other participating institutions in financing and structuring efficient energy and emission reduction projects and in using carbon credits as security and for improving credit quality. The panel also explained the IIC-sponsored CERSPA initiative for developing a balanced emission reduction sales and purchase agreement template representing the interests of carbon credit buyers, project developers, and lenders.

The IIC will continue its work on sustainable energy and climate change by providing project finance and technical assistance, helping its clients identify opportunities, disseminating information, and promoting sustainable energy projects. The IIC has both the tools and the experience required to foster more action in the area of carbon finance on the part of Latin American and Caribbean banks. Banks with credit lines from the IIC can access non-reimbursable technical assistance for a wide variety of studies and support in accessing the carbon credit market for their clients financed with IIC funds, and the IIC seeks to partner with local institutions to leverage its financing, technical assistance funds, and experience in furthering access from companies in the Latin America and Caribbean region to the carbon credit market. The IIC's efforts are an integral part of the IDB Group's Sustainable Energy and Climate Change Initiative (SECCI).

The Inter-American Investment Corporation is a multilateral financial institution that is a member of the Inter-American Development Bank (IDB) Group. It provides financing (in the form of equity investments, loans, guarantees, and other instruments) and advisory services to private enterprises in Latin America and the Caribbean. The IIC’s mission is to promote the economic development of its regional member countries by encouraging the establishment, expansion, and modernization of private enterprises, particularly those that are small and medium in size. For more information on the IIC's activities, please visit www.iic.int.

Contact: Alejandro Prada/Sylvia Szankay

Telephone: (202) 623-2958/(202) 623-3878

Email: alejandrop@iadb.org