International Climate Initiative (IKI)

he International Climate Initiative (IKI) is an important part of the German government international climate finance commitment. Since 2022, the Federal Ministry for Economic Affairs and Climate Action (BMWK) has been the lead ministry for the IKI. The funding program cooperates with its founding ministry, the Federal Ministry for Environment Nature Conservation, Nuclear Safety and Consumer Protection (BMUV), as well as the Federal Foreign Office. Through the IKI, the ministries jointly support approaches in developing and emerging countries to implement and ambitiously develop the Nationally Determined Contributions (NDCs) anchored in the Paris Agreement. This includes measures to adapt to the impacts of climate change and to conserve and rebuild natural carbon sinks, taking into account environmental, economic and social concerns. With regards to biodiversity, the IKI also supports its partner countries in achieving the goals of the Convention on Biological Diversity (CBD).

The activities from IKI projects range, for example, from advising policy makers on capacity building and technology partnerships to risk hedging through innovative financial instruments. It also includes studies, project preparation advice for infrastructure development, and investment instruments for climate change mitigation or biodiversity conservation.

To date, IKI has approved more than 800 climate and biodiversity projects in over 60 countries worldwide with a total funding volume of 5 billion euros (2008-2021).

Four funding areas

The IKI finances projects run by organisations that implement measures together with developing, emerging and transitional countries within the four IKI funding areas:

  • Mitigation of greenhouse gas emissions
  • Adaptation to the impacts of climate change
  • Conservation of natural carbon sinks such as forests or peatlands, and Reducing Emissions from Deforestation and Forest Degradation (REDD+)
  • Conservation of biological diversity

Many projects normally involve more than one funding area. The list of measures addressed by IKI projects includes advising policymakers, capacity building, technology partnerships and innovative financing mechanisms. Funding is also available for reports and position papers as well as investment vehicles for climate action and biodiversity conservation.

Topic-driven financing and bilateral cooperation

The IKI uses a two-pronged strategy to support its partner countries. On the one hand, this involves ideas competitions with a thematic focus: these include large-volume thematic selection procedures (thematic calls) as well as two small-scale project programmes, namely IKI Small Grants and IKI Medium Grants. All three types of ideas competition utilise a call-for-proposals model for funding priorities that are set each year with no focus on individual countries. Based on their expertise and experience, implementing organisations propose project activities in countries that are a good match for the funding priorities.

On the other hand, the IKI also works bilaterally in key areas with 15 priority countries. Part of this cooperation involves the country-specific, large-volume selection procedures (country calls). Working in close consultation with the partner governments, ideas competition is again used here to select projects for two specific and urgent thematic fields. In addition, a country-specific IKI ‘interface project’ also operates in most of these priority countries, working on key topics such as climate change mitigation, adaptation or biodiversity conservation. These interface projects are managed by the Deutsche Gesellschaft für internationale Zusammenarbeit (GIZ). The projects maintain an office in the respective priority country, work closely with German embassies and help to improve Germany’s cooperation with the partner country in the field of policymaking. Each interface project also facilitates networking of all the local IKI projects in the country run by different implementing organisations in order to maximise synergistic benefits between projects. The current 15 priority countries that the IKI works with are: Brazil, China, Colombia, Costa Rica, India, Indonesia, Mexico, Peru, the Philippines, Russia, South Africa, Thailand, Turkey, Ukraine and Viet Nam.

With the exception of IKI Small Grants, ideas competitions are organised into two stages. A shortlist of projects is compiled from all the project outlines submitted. The shortlisted applicants are requested to prepare a detailed project proposal. This proposal is then used as the basis for the final funding decision. Two key features of IKI set it apart from conventional approaches to development cooperation. One is the competitive model for the funding programme and the other is the inclusion of NGOs as implementing organisations. None of IKI funds flow to government institutions in partner countries. 

Topic-related advice and assistance, programme management and project evaluation work are supported by the IKI Office, which forms part of the federally owned Zukunft – Umwelt – Gesellschaft (ZUG) gGmbH.

The International Climate Initiative (IKI) in a nutshell (subtitled)