26 June 2024, Kathmandu
OPEC Fund Provides $25 Million Loan to Global IME Bank to Support Small Businesses and Enhance Climate Resilience in Nepal
OPEC Fund Grants $25 Million Loan
The OPEC Fund for International Development (the OPEC Fund) has signed a US$25 million loan agreement with Global IME Bank Limited to increase access to financing for micro, small, and medium enterprises (MSMEs), including women-owned enterprises, as well as climate-smart projects.
OPEC Fund’s loan will help to address significant financing gaps for MSMEs, which make up 95 percent of Nepal’s registered businesses and account for 45 percent of all jobs.
Despite their importance, MSMEs struggle to receive funds, and the financing gap for these enterprises is estimated at US$3.6 billion. Additionally, the loan will enhance GIBL’s climate finance portfolio, which is vital for Nepal’s efforts to mitigate climate change impacts.
OPEC Fund President Abdulhamid Alkhalifa said: “We are delighted to partner with Global IME Bank to bolster support for MSMEs and climate-smart projects in Nepal.
These sectors are crucial for sustainable economic growth and resilience against climate change. Our loan will help address the significant financing gaps and promote inclusive development.”
Chief Executive Officer of Global IME Bank, Ratna Raj Bajracharya, said, “This loan agreement reinforces our commitment to finding local solutions through climate and gender financing to achieve global sustainability and inclusivity goals.
We aim to bridge the resource gap in Nepal’s green energy sector and address gender disparity by empowering women economically through accessible financing.”
“We are grateful to partner with the OPEC Fund in this endeavor. This collaboration will enhance our support for MSMEs, vital to Nepal’s economy, and strengthen our efforts in promote climate resilience and sustainable development. Together, we can significantly impact Nepal’s journey towards a greener and more inclusive future.”
Nepal ranks 94th globally in CO2 emissions, with half of its greenhouse gas emissions coming from the agriculture sector.
The country is highly vulnerable to climate change impacts, which disproportionately affect vulnerable communities.
Increasing access to climate finance is essential for Nepal’s sustainable development, supporting initiatives such as clean transportation, climate-smart agriculture, and solar projects.
OPEC Fund Grants $25 Million Loan
The OPEC Fund and Nepal have a long-standing partnership focused on driving sustainable development.
The OPEC Fund has committed funding to various sectors, including banking, energy, agriculture, transportation, and education.