Country
Thailand

Local Project Partner
Bank for Agriculture and Agricultural Cooperatives (BAAC), state-owned bank with a focus on agriculture

German Project Partner
--

Donor
GIZ

Duration
01.09.2025 - 30.11.2026

Thailand's rice sector, the largest agricultural emitter of greenhouse gases, faces significant climatic risks itself due to water shortages and rising temperatures. Small farmers, many of them women, are particularly affected. Climate-smart cultivation methods could help but require financing. However, banks are hesitant because climate risks increase credit risk. The Bank of Thailand now requires banks to systematically record and manage these risks. However, without access to finance, farmers cannot act against climate risks. BAAC's mandate is to promote the agricultural sector - by strengthening climate-friendly lending, it contributes to the reduction of GHG emissions and at the same time reduces risks in the loan portfolio.

Integration of Climate Smart Lending into BAAC's lending policy (strategy and risk management) Development of credit policy and credit procedures for climate-friendly lending in BAAC Build lending capacity within BAAC that considers climate-friendly practices and products Facilitating the continuation, expansion and adaptation of BAAC's Climate Smart Lending Strengthening the exchange of knowledge between national and regional stakeholders

Task
To achieve these goals, the following measures, in particular, will be implemented:

• Implementation of an integrated ESG risk management system for the BAAC in Thailand
• Consulting services to facilitate the provision of financing to rice farmers, enabling them to transition to climate-adaptive farming practices
• Strengthening the BAAC’s capacity to offer loans for climate-friendly and resilient agricultural techniques
• Conducting various workshops on the above-mentioned topics