NAFIN, AFD Sign Agreement to Finance Sustainable Construction

Nacional Financiera (NAFIN) and the French Development Agency (AFD) have signed an agreement to finance sustainable construction projects in the country, totaling US$100 million. This structured financing, which is divided into two tranches, aims to promote energy efficiency, reduce CO₂ emissions, and encourage the responsible use of water, driving economic development with an environmentally responsible approach.

“With this program, we seek to strengthen the standard of sustainable construction, promoting buildings that are not only efficient but also resilient to climate change,” says Ismael Villanueva, Head of the Emissions and International Relations Unit, NAFIN.

The agreement establishes two distinct financing tranches:

• Tranche A: US$25 million comes from the Green Climate Fund (GCF) under the Partnership for Energy Efficiency in Buildings (PEEB Cool) initiative. This tranche offers preferential conditions to incentivize the adoption of sustainable practices in the construction sector.

• Tranche B: US$75 million comes from AFD to finance high-impact projects promoting energy efficiency and sustainability across the country.

This financing marks the first operation globally under the PEEB Cool program, setting a milestone in global efforts to transform the construction industry into one that aligns with the highest environmental standards.

The agreement was formalized at NAFIN’s headquarters in Mexico City in late 2024, in the presence of Villanueva and Alexia Levesque, Regional Director for Mexico, Cuba, and Central America, AFD. According to Villanueva, this program is part of the Sustainable NAFIN Strategy, which aims to align Mexico’s efforts with the objectives of the 2030 Agenda and the Paris Agreement, promoting the construction of resilient, energy-efficient buildings that can withstand extreme climate events.

The financing will be allocated to projects that promote innovative solutions, the adoption of sustainable materials, and the use of energy-efficient technologies. It will also focus on strengthening institutional capacities for the design and monitoring of efficient construction projects aligned with Mexico’s climate goals.

The PEEB Cool program focuses on reducing energy consumption and greenhouse gas (GHG) emissions in construction and renovation projects. It also encourages the use of innovative designs and efficient technologies that will lead to water savings, reduced operational costs, and greater thermal comfort, contributing to resilience against climate risks.

Levesque highlights that this agreement reflects the joint commitment of both institutions to a just climate transition and to help Mexico’s construction sector adopt more sustainable and efficient models.

This preferentially structured financing will also help create a favorable ecosystem for developing sustainable projects in Mexico. The goal is to consolidate the expansion of the country’s productive capabilities in line with environmental, social, and governance (ESG) standards. Additionally, the financing is expected to boost the competitiveness of Mexican companies in global markets and encourage the integration of sustainability into growth strategies.