COP31 host Turkiye, AIIB strike record $1.6 billion climate policy deal
ANTALYA: The Asian Infrastructure Investment Bank has agreed a record $1.6 billion financing deal with COP31 climate conference host Turkiye to support a series of policy reforms aimed at attracting the investment it needs to hit its climate goals, the bank said. Turkiye, a founding member of the AIIB, will need an estimated $68 billion in additional climate investment by 2030, around half from…
The Asian Infrastructure Investment Bank (AIIB) and Turkiye have struck a record $1.6 billion financing deal to support climate policy reforms, according to a statement released on Thursday, the fourth day of the two-week UN climate conference in Antalya. Turkiye, a founding member of the AIIB, is projected to require approximately $68 billion in additional climate investment by 2030, with roughly half expected to come from private sources.
The agreement covers fiscal policy, financial regulation, and sectoral planning, and will aid in the implementation of Turkiye's Climate Law and its goal to reduce emissions, including an interim target for 2035 and a net-zero objective by 2053. The funding will facilitate sustainable finance, expedite decarbonization, and enhance climate resilience across the nation of 86 million inhabitants, as climate change exacerbates drought, floods, and wildfires.
AIIB Chief Investment Officer Konstantin Limitovskiy expressed optimism about contributing to Turkiye's climate achievements. The financing represents the AIIB's largest climate policy-based package to date. Additionally, the deal will help scale Turkiye's nascent emissions trading scheme, which will allow entities in high-emission sectors to trade allowances.
This could benefit Turkiye by providing a domestic carbon price that could be considered in the European Union's carbon border levy on imported products, potentially aiding Turkiye's exporters to the bloc in sectors like steel and cement. The reform plan includes targets such as enlisting at least 180 facilities to report baseline emissions under the scheme by April 2027, securing 1,800 megawatts of wind and solar capacity by early 2027, aiding 225,000 farmers in adopting less water-intensive crops by 2028, and designating 50,000 hectares (124,000 acres) as carbon sinks by the same year.
Turkiye faces mounting challenges from water scarcity, drought, extreme heat, wildfires, and urban flooding, making this reform plan crucial for strengthening planning and risk management in areas such as water resources, ecosystems, and public health.
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