Green Climate Fund makes record investment in Jordan’s $6B desalination project

The world’s largest multilateral climate fund has announced its biggest financial commitment yet, backing a $6 billion water desalination and conveyance project in Jordan aimed at addressing the country’s worsening water scarcity, Reuters reported.

The Green Climate Fund (GCF) approved a $295 million package—comprising both loans and grants—at its board meeting in South Korea on Wednesday.

The funding will support the Aqaba-Amman Water Desalination and Conveyance Project, one of the largest of its kind globally, and is expected to attract additional financing from the International Finance Corporation (IFC) and private investors.

"It will transform the country," Mafalda Duarte told Reuters, adding that the commitment to Jordan's Aqaba-Amman Water Desalination and Conveyance Project marked the fund's "highest investment in a single project".

Addressing Jordan’s acute water crisis

Jordan, one of the most water-scarce nations on Earth, faces increasing strain on its limited resources.

The desalination project, led by French infrastructure group Meridiam and utility giant SUEZ, will produce and transport about 300 million cubic meters of potable water each year to serve nearly half the country’s population.

Climate projections paint a grim picture: temperatures in Jordan could rise by up to 4°C and rainfall could drop by more than 20% by the end of the century.

This would mean greater evaporation, depleted groundwater, and more frequent droughts.

"The project is a strategic project to desalinate and transport 300 million cubic meters of water every year to most parts of the kingdom," Jordan's Minister of Water and Irrigation, Raed Abu Soud, told Reuters.

The United States, a key ally of Jordan, has pledged $300 million in grants and $1 billion in loans toward the effort, while other regional partners are also expected to contribute.

Global climate financing momentum builds ahead of COP30

The GCF’s commitment to Jordan comes as momentum builds toward the COP30 climate summit in Brazil this November, marking a decade since the Paris Agreement established the fund as a central mechanism for climate financing.

At this week’s board meeting, 24 projects were up for discussion, totaling $1.4 billion in potential funding—set to be the fund’s largest-ever disbursement if all are approved.

A senior official involved in the Jordan project said the GCF’s contribution would help lower water costs by 10 cents per liter and save the government $1 billion over the project’s lifetime.

It would also enable the IFC to provide more favorable loan terms, reducing the cost of private financing.

Duarte noted that while multilateral development banks still lag in mobilizing private capital, the GCF is pushing to accelerate decision-making and broaden risk-sharing frameworks.

While MDBs were still not doing enough to mobilise private sector capital, their stakeholders needed to be realistic about how much risk they can take, Duarte said.