Cape Verde Climate and Environmental Fund

Law no. 44/X/2024, of 23 December

In view of the climate change that Cape Verde is facing due to its geographical location, some sectors such as Agriculture and the Tourism Industry (two main economic sectors in Cape Verde) are highly vulnerable to the impacts of climate change and natural risks.

Recognising the urgent need to increase climate resilience and pursue sustainable development, the Government of Cape Verde prioritises the establishment of an integrated climate governance framework marked by greater transparency with a view to fulfilling the country’s commitments under the Paris Agreement and the global biodiversity framework of the United Nations Convention on Biological Diversity.

Based on the needs described above, Cape Verde passed Law 44/X/2024, of 23 December, which aims to create a climate and environmental fund, which will play a key role in driving the development of the country’s green environment and blue economy, while functioning as a financing mechanism for the determined national contribution and the national adaptation plan.

Furthermore, the creation of this fund will help position Cape Verde as a leader in climate action among Island Developing States (SIDS).

In addition, Law 44/X/2024 of 23 December aims to create and establish the legal basis for the Cape Verde Climate and Environmental Fund (FCA) as an innovative financing solution that will catalyse new financing for green/blue projects, mobilise mixed financing for nature-positive investments, and build capacity/leadership for nature-based solutions.

The purpose of this law is to create and establish the legal foundations of the FCA as an innovative financing solution that will catalyse new financing for green/blue projects, mobilise mixed financing for nature-positive investments, and build capacity/leadership for nature-based solutions.

The FCA aims to achieve public-private partnerships with other global and domestic climate and environmental funds; to finance programmes and projects that contribute to a broad reduction in greenhouse gas emissions and an increase in carbon sequestration, to the conservation of biodiversity, to access to water and to Cape Verde’s climate resilience; to serve as a bridge between international partners and national programmes and projects; to provide technical and financial support for the development of projects in the green and blue economy, as well as the transport and electric mobility sector that can be financed in Cape Verde, among others.

The FCA aims to pursue its corporate purpose with respect for the principle of constitutionality, substantive legality, justice, speciality, independence, transparency, impartiality, good faith, procedural flexibility, effectiveness, efficiency, rationalisation of its procedures and the participation of stakeholders in its technical and administrative management, as well as complementarity with existing institutions.

The FCA can finance projects proposed to it by:

– National or local public institutions with legal competences in climate change, energy transition, environmental protection and sustainable development.

– Civil society organisations working in the fields of climate change, biodiversity conservation and sustainable development.

– National or international private sector companies, ventures and businesses that demonstrate a commitment to sustainable climate action and practice, and;

– Academic or research institutions working in the fields of climate change, biodiversity conservation and sustainable development.

The FCA has its headquarters in Praia, Santiago Island, Cape Verde, and may open offices in other parts of the country or abroad, when this is favourable to the efficient pursuit of its purposes.

Law no. 44/X/2024 of 23 December was published on 27 December 2024 and came into force on 28 December 2024.