France, having expertise and experience in tackling climate change issues, is keen on meeting Bangladesh's financing needs by providing AFD concessional loans for green investments and through supporting the government in addressing climate related issues, says Agence Française de Dévelopment (AFD) executive director Philippe Orliange.
With the upgrade from least development country (LDC) status and the “rapid” economic development of Bangladesh, the government is looking for massive capital investments while facing unprecedented environmental and climate change issues, he told UNB in an exclusive interview.
During his two-day visit recently, the highest-level AFD mission to date, Orliange acknowledged the growing collaboration between AFD and Bangladesh over the past decade.
The French Embassy in Dhaka and AFD's Dhaka office organized the Bangladesh visit of the executive director considering the population size of the country that is significant for a development partner.
Orliange, who had a meeting with the finance and ERD secretaries of the Government of Bangladesh (GoB) and the Bangladesh Bank governor on the same day, said the portfolio of Bangladesh is around 1.4 billion euros
AFD's financing in Bangladesh almost tripled over the last three years (a total of 1.4 billion euro has been committed since 2012).
“We signed with the government loans and grants for 543M€ in the last 2 years (2021 and 2022). It was agreed with the government that AFD would commit to around 300M€ annually in the coming years,” Orliange said.
Public development banks and development financial institutions play a key role in delivering sustainable and high-quality projects, taking into account the needs of partner countries and ensuring lasting benefits for local communities, in the specific context of the Indo-Pacific.
There is indeed a pressing need to recognise that among the challenges that the Indo-Pacific is facing, sustainability is no less urgent and strategic than the security agenda, Orliange said.
Responding to a question, Philippe said of course, AFD has started due diligence on a Blue Economy project to improve the research capacity of the Bangladesh Oceanographic Research Institute (BORI) by acquiring an advanced oceanographic research vessel.
The objective is to help BORI with physical and chemical oceanographic campaigns, underwater mapping, geological sampling, marine biology or fisheries resource assessment, he said.
In terms of green energy, AFD, together with the European Union, is currently supporting the Dhaka Power Distribution Company (DPDC) to strengthen its distribution grid by expanding and renovating it, and commissioning smart-grid technology on a pilot basis.
“AFD also recently showed interest in financing solar photovoltaic power plants and hopes to make it concrete soon,” Orliange said.
AFD is also taking part in the European Union's initiative called “Green Energy Transition in Bangladesh”, to engage in a policy dialogue with the Ministry of Power, Energy and Mineral Resources and especially with Bangladesh's Sustainable and Renewable Energy Development Authority (SREDA).
Responding to a question, Orliange said the AFD Group includes a subsidiary named Proparco, which deals exclusively with the private sector.
Proparco is active in Bangladesh with a growing portfolio in the textile and energy sector (135 million USD committed over 7 projects since 2013). Proparco's activities are monitored from the regional office based in Delhi, with regular visits and missions undertaken to see the evolution on the ground.
AFD finances the private sector and the industries through public financial institutions.
At the moment, AFD finances three credit lines with Bangladesh Bank, IDCOL and BIFFL which aim to finance private firms investments which qualify.
These investments must prove to save energy (energy efficiency) or to produce green energy from renewables, or to improve the safety and hygiene of the workers.
