The Allied Climate Partners (ACP), International Finance Corporation (IFC), the Monetary Authority of Singapore (MAS), and Temasek have joined forces to address the climate finance gaps in Asia, particularly Southeast Asia.
The region requires approximately US$1.7 trillion annually in infrastructure investments until 2030 to sustain growth and meet climate targets. However, green infrastructure projects often struggle with bankability, especially during the development and construction phases.
This partnership, formalised through a Memorandum of Understanding (MOU) signed at the 28th Conference of the Parties (COP28) to the United Nations Framework Convention on Climate Change, seeks to bridge this gap.
The collaboration will employ blended finance, combining concessional capital from philanthropic and public sectors with private capital. It aims to create a robust pipeline of sustainable investments in areas such as renewable energy, electric vehicle infrastructure, and waste management.
The parties have committed to supporting environmental and social goals, including carbon reduction, job creation, and community resilience against climate change.
ACP will offer origination and technical support, while IFC will provide advisory services, industry expertise, and capital mobilisation capabilities.
Meanwhile, MAS plans to leverage its networks within Singapore’s financial and sustainable finance sectors, and Temasek will use its network for origination and investment opportunities.
The partnership aims to catalyse and attract additional concessional and commercial capital, with an open invitation to stakeholders in both the public and private sectors to support these efforts.
This initiative is seen as a critical step in mobilising the necessary capital for Asia’s transition to sustainable infrastructure.
“This green investments partnership exemplifies the kind of public-private partnership that is key to mobilising the capital necessary for Asia’ transition.
By using blended finance and targeted de-risking at the early stage of project preparation and construction, it will help to strengthen project bankability and crowd in private investment at scale,”
said Ravi Menon, Managing Director, MAS.
“Blended finance is key to accelerating green investments in emerging markets and developing economies in Southeast Asia. Concessional capital providers play a crucial role here in unlocking the capital stack to attract commercial capital from investors like Temasek.
We are glad to be working with ACP, IFC and MAS to enable the deployment of climate finance, and look forward to more collaborations across the public, private and developmental finance sector players to crowd in capital in innovative and complementary ways, so as to contribute towards a clean and inclusive transition for the region,”
said Dilhan Pillay, CEO of Temasek.