NAIROBI, Kenya, Aug 11 – Kenya is stepping up efforts to mobilise financing for green businesses and climate-friendly investments as the Government and development finance institutions seek to bridge a widening funding gap for sustainable economic development.
The push is being led by the Kenya Development Corporation (KDC), which has launched its first sustainability and green financing strategy with USD42 million already mobilised for green investments, while pursuing additional capital through partnerships and international climate-financing institutions.
KDC Director General Norah Ratemo said the corporation is seeking accreditation with the Green Climate Fund (GCF) to expand its capacity to mobilise resources, while its new green fund will provide both debt and equity financing to businesses seeking to adopt sustainable practices.
Environment, Climate Change and Forestry Principal Secretary Festus Ng’eno said the move reflects a broader shift in how climate action is viewed, with sustainability increasingly being treated as an economic priority rather than solely an environmental concern.
“Sustainability strategy is no longer an environmental agenda. We are looking at it from the economic perspective,” Ng’eno said.
Ratemo said KDC’s initial USD42 million mobilisation would form the starting point for a broader fundraising drive targeting businesses that are already green as well as those seeking to transition to greener operations.
“We are looking to mobilize more capital and, as the PS has mentioned, there are various institutions that we can partner with in terms of raising this capital,” she said.
She said the green fund would go beyond conventional lending by providing equity to businesses that may be too highly leveraged to take on additional debt.
“We’re just not doing that, we’re also going to do equity because businesses are really struggling, I know, highly leveraged,” Ratemo said.
This approach comes as Kenya faces a significant climate-financing shortfall, with estimates putting the country’s annual requirement at about USD62 billion, against the roughly 13 per cent that can currently be mobilised through the National Treasury.
Ng’eno welcomed KDC’s strategy, saying greater participation by State corporations and the private sector would help expand the resources available for climate action while supporting economic transformation.
He said KDC could also pursue financing through the Green Climate Fund, Adaptation Fund and Global Environment Facility, adding that stronger sustainability frameworks would help position Kenya to access such resources.
