Empowering Green Investments in North Macedonia

A new green finance initiative worth €30 million has been launched in North Macedonia to provide funding for small and medium-sized enterprises (SMEs) and underserved individuals. The Green Finance Facility (GFF) will offer performance-based incentives and technical cooperation support to promote investments in renewable energy and energy efficiency solutions. This initiative, supported by the United Nations and the government of North Macedonia, aims to accelerate the implementation of the 2030 Agenda and achieve the Sustainable Development Goals.

The GFF will provide new loan options with performance-based incentives for SMEs and creditworthy but underserved individuals and households in North Macedonia. These loans will support investments in renewable energy and energy efficiency solutions such as photovoltaics, heat pumps, inverters, solar panels, and efficient heating systems.

The launch of the GFF was marked by a meeting in Skopje, attended by representatives from the government of North Macedonia, the United Nations (UN) family, the European Bank for Reconstruction and Development (EBRD), and commercial banks from the country. Fatmir Bytyqi, the Deputy Prime Minister for Economic Affairs in the Government of North Macedonia, expressed strong support for the project, emphasizing its significance in the post-Covid economic recovery and energy crisis.

As part of the package, the GFF will provide performance-based payments of up to 10 per cent of the loan for SMEs, and 30 per cent performance-based payments of the loan principal for target groups. These target groups include female-headed households, single parents, households with people with disabilities, Roma, employees affected by Covid-19, remittance recipients, and returning migrants.

The GFF aims to cut energy consumption and greenhouse gas emissions, contributing to cleaner air in North Macedonia. Rossana Dudziak, UN Resident Coordinator in North Macedonia, highlighted the goal of bringing the benefits of green transition to SMEs and underserved groups in society, making investments in renewable energy and energy efficiency easier and more affordable for businesses and homes.

The initiative is aligned with and supports the achievement of Sustainable Development Goals (SDGs) and the UN Sustainable Development Cooperation Framework (SDCF) targets. The European Bank for Reconstruction and Development (EBRD) expressed delight in the strong partnership that enabled the launch of the GFF, leveraging relationships with local financial institutions to expand the availability of green finance to local SMEs.

The GFF is scheduled to end by April 2026, with other local partner financial institutions expected to take part and further expand its availability in the country. The initiative was selected as one of 10 programmes globally recognized for its significant impact, investment readiness, and substantial co-financing leverage.

Rania Sharshr, Director of Peace and Development Coordination at the International Organization for Migration (IOM), commended the inclusive nature of the initiative, involving government entities, UN agencies, an international financial institution, think tanks, and private sector banks. This model could serve as an example of partnership development that can be scaled up and replicated in other countries.

Dmitry Mariyasin, UNECE Deputy Executive Secretary, emphasized the importance of focusing on SMEs in climate finance, as they account for up to 60 per cent of carbon emissions globally but often lack access to climate finance or transition finance. The GFF, implemented by the United Nations Development Programme (UNDP), the IOM, and the United Nations Economic Commission for Europe (UNECE), with financial support from the Joint SDG Fund and co-financing from the government of North Macedonia, aims to address this gap and promote green transition among SMEs and underserved groups in society.