PROPARCO and CDC Climat unite against climate change

Guido Schmidt-Traub, CEO of CDC Climat AM, Pierre Ducret, CDC Climat’s Chief Executive and Etienne Viard, PROPARCO’s Managing Director

Paris, May 12th 2011 – CDC Climat, Caisse des Dépôts subsidiary dedicated to fighting climate change and PROPARCO, private sector arm of the Agence Française de Développement (AFD), are forming a strategic partnership to invest jointly in carbon emission reduction projects in Sub-Saharan Africa and the Mediterranean region. PROPARCO is investing in CDC Climat Asset Management and has entrusted the company with €30 million to invest in Sub-Saharan Africa and the Mediterranean region.

This partnership takes shape by PROPARCO acquiring a 25% share in the equity capital of CDC Climat Asset Management, CDC Climat’s carbon asset management subsidiary.

In addition, PROPARCO is awarding two mandates totalling €30 million to CDC Climat Asset Management, one €15 million mandate for investments in the Mediterranean region, and a further €15 million mandate intended for Sub-Saharan Africa, through the African Investment and Support Fund (FISEA), which is owned by,AFD and managed by PROPARCO. Both these mandates ought to enable to acquire at least 3.3 MtCO₂e. They come in addition to the €60 million already managed by CDC Climat Asset Management on behalf of CDC Climat.  

“This strategic decision reflects the intention of PROPARCO and the AFD intention to address market inadequacies and to play the role of a catalyst for private investment in regions that have been overlooked by investors and have not had access to carbon finance in spite of a substantial potential for projects to reduce greenhouse gas emissions. With those mandates, our aim is to attract other investors to the Mediterranean an Sub-Saharan regions”, explains Etienne Viard, PROPARCO’s Managing Director.    

Pierre Ducret, CDC Climat’s Chief Executive, adds “This partnership brings together the best skill set for making carbon investments in clean development projects across Africa and the Mediterranean region that are of a very high social, environmental as well as financial quality” .  

“We are delighted that PROPARCO is becoming a shareholder and entrusting us with these two new mandates . This strategic partnership is an important step in CDC Climat Asset Management’s development, “ adds Guido Schmidt-Traub, CEO of CDC Climat Asset Management.  

The strategic partnership between CDC Climat and PROPARCO will enable project sponsors to benefit from CDC Climat’s expertise in the carbon markets, as well as from PROPARCO’s know-how regarding private sector funding in developing countries. Together, the partners will offer a broad range of equity, debt, and carbon finance solutions. Under this partnership a senior PROPARCO manager will be seconded to CDC Climat Asset Management.  

This alliance demonstrates the ability of French financial players to come together to leverage their actions to mitigate climate change in developing countries.  

ABOUT  

CDC Climat is the 100%-owned subsidiary that the Caisse des Dépôts created in February 2010, in order to combat climate change through three types of business activities: investing in carbon assets, developing carbon market services and researching the economy of climate change.

- It invests in carbon assets either directly or in the form of innovative funds open to other long-term investors. It aims at reducing CO₂ emissions by 60Mt before the end of 2014. Its investments are managed by its subsidiary CDC Climat Asset Management.

- CDC Climat develops, either alone or with its partners, secured climate and carbon market services: registries and solutions for carbon assets transactions and custody, MRV tools... It invests in innovative companies that contribute to a low carbon economy. As such, CDC Climat is notably a strategic shareholder of the exchange BlueNext.

- Its research team, CDC Climat Research, conducts independent, non for profit analyses for public authorities, market players and the general public.

On the strength of its experience in Europe, CDC Climat supports the introduction of international, national and regional climate policies.

CDC Climat is part of Caisse des Dépôts Group, a long term investor serving general interest and the economic and sustainable development. www.cdcclimat.com  

PROPARCO , a financial development institute, is owned by the French Development Agency (AFD) and private shareholders in Northern and Southern Hemisphere countries. Its aim is to act as a catalyst for private investment in emerging and developing countries, in growth and sustainable development, as well as in order to meet Millennium Development Goals. PROPARCO ranks among the world’s major bilateral development finance institutions. It is active in four continents, and its scope ranges from major emerging markets to the poorest countries, especially in Africa. PROPARCO has high requirements in terms of social and environmental responsibility. www.proparco.fr  

The French Development Agency (AFD), a public agency, has been working to combat poverty and promote development in Southern Hemisphere countries for over 60 years. The agency implements the development policy defined by the French Government. The AFD, which has a presence in the field in over 50 countries, finances and supports projects that improve the living conditions of the population, support economic growth and protect the planet: children’s schooling, support for farmers and small companies, water supply systems, conservation of tropical forests, combating climate change, etc. In 2010, the Agency invested over €6.8 billion in financing initiatives in Southern Hemisphere and overseas countries. These investments involved providing primary schooling for 13.4 million children, improving drinking water supplies for 33 million people and granting micro-loans to 700,000 people. Energy saving projects carried out in the same year will enable almost 5 million tonnes of CO₂ to be saved on an annual basis. www.afd.fr  

CDC Climat Asset Management is the carbon asset management subsidiary created by CDC Climat in September 2010. The Company combines multiple skills in the finance, carbon project and risk management fields, and invests in high-quality environmental projects, which it manages in the best interests of its investors. www.cdcclimat-am.com