Integration of climate change into country level work

Explanation

The EBRD is primarily focused on lending to the private sector, thus working with countries and governments is not such a major focus of the institution as it is for other MDBs.

However, the Bank has been developing broad five-year Country Strategies for countries, with the overarching goal of assisting the country’s development of a sustainable market economy. Strategies are coupled with a Country Diagnostic, which primarily assess the challenges and opportunities facing the country’s private sector. During the development of the Bank’s Country Strategy, this report is developed as a means to steer policy engagement and priority setting in terms of both overarching goals and specific project selection. To do this, a diverse set of methodologies are used in consultation with in-house experts including: cross-country studies, established surveys, reports and commissioned studies. The Bank’s Country and Economics Policy team is in charge of Country Diagnostics, in consultation with the Economics, Policy and Governance department as well as a wide range of experts.

Country Strategies are guided in part by each country’s NDC, because “NDCs will ultimately reflect the countries’ strategic orientations“.  These Country Strategies are based around the Bank’s six “transition qualities”, including “green” and “resilient” transitions. The Country Strategies focus on specific goals and sectors dependent on the country’s needs. Green or resilient themes include priorities such as “strengthen[ed] energy diversification and low-carbon transition” in Albania, “improved performance, service delivery and sustainability of municipal infrastructure” in Armenia and “increased role of commercial financing for green economy investments, where applicable” in the Slovak Republic.

The EBRD does work with governments through “policy dialogue” activities to support institutional and regulatory frameworks. The EBRD’s Green Economy Transition approach refers to a deepening of the policy dialogue as well as “continuing to deliver policy dialogue that contributes to an enabling environment for sustainable resource investment”. This document also refers to national action plans, as well as policy roadmaps for specific industry sectors including cement, steel and carbon capture and storage (CCS). It is not clear to what extent the roadmaps are aligned with a long-term net-zero pathway. The GET Approach covers energy and resource efficiency, circular economy, renewable energy and climate resilience with a variety of regional and national projects, single-issue programmes and capacity building.

The EBRD is currently in the process of producing a new Green Economy Transition Approach 2.1. The draft for consultation stated that integration with Green Cities Action Plans will be an increased priority for country work, as well as developing policy and regulations to increase country-level activity regarding support for NDC formulation and low-carbon transition pathways. If this approach is fully implemented then an increase to Paris aligned will be considered.