The European Bank for Reconstruction and Development (EBRD), in collaboration with the European Union (EU), has launched the Green Economy Financing Facility (GEFF) programme in the West Bank to accelerate the region’s shift toward a greener and more sustainable economy. Under this initiative, up to €25.9 million in senior unsecured loans will be made available to four local financial institutions over the next seven years. These funds will be used for gender-responsive on-lending to Palestinian micro, small, and medium-sized enterprises (MSMEs) and households.
The programme is designed to stimulate investment in small-scale renewable energy, as well as projects that improve water, energy, and resource efficiency—key areas for building a low-carbon and climate-resilient economy. Palestinian MSMEs represent more than 95% of businesses in the West Bank and Gaza and contribute over 55% of the region’s gross domestic product. Despite their importance, these businesses face significant challenges in securing financing, particularly for green technologies. The GEFF programme addresses this gap by improving access to capital and fostering the adoption of sustainable solutions.
The West Bank and surrounding region are under increasing pressure from rapid population growth, rising energy and water consumption, and the worsening impacts of climate change. Fuel and energy costs are among the highest in the region, and dependence on imported power continues to strain local economies. To further incentivize green investments, the EU, through its Sustainable Growth4All Programme, will provide up to €5.2 million in investment grants. These grants are intended to encourage MSMEs and households to adopt green technologies and practices, helping them reduce operational costs while contributing to environmental sustainability.
Eligible projects could include investments that enhance energy efficiency, conserve water and materials, and strengthen resilience to climate change impacts. In addition, EU-funded technical assistance will be provided to partner financial institutions to build their capacity in identifying and appraising green investment opportunities, ensuring proper project implementation, and promoting sustainable financing practices. This assistance will also include awareness campaigns to highlight the benefits and cost-effectiveness of green technologies, provide guidance to MSMEs on selecting suitable technologies, and integrate a gender perspective into investment and advisory services.
Since beginning operations in the West Bank and Gaza in 2017, the EBRD has approved 36 projects totaling €185.5 million. The launch of the GEFF programme underscores the Bank’s ongoing commitment to fostering private sector development, environmental sustainability, and economic resilience in the region, while empowering local businesses and communities to embrace a cleaner, more sustainable future.
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