The Asian Development Bank (ADB) and Singapore’s Infrastructure Asia have partnered up in an effort to help governments in Southeast Asia develop sustainable infrastructure projects.
The two groups signed a cooperation agreement during the Asia Infrastructure Forum in Singapore last week. The agreement will allow ADB and Infrastructure Asia to help state-owned enterprises, as well as regional and municipal governments, improve their institutional, financial and governance capacities for developing innovative and green infrastructure programs and projects.
As a means of achieving this, ADB and Infrastructure Asia are launching the Innovative Finance Lab for Sustainable Infrastructure, a virtual space that will act as a platform for the Association of Southeast Asian Nations' (ASEAN) Catalytic Green Finance Facility (ACGF).
The facility was launched in April to boost ASEAN’s development of green infrastructure projects by catalyzing public and private capital and technologies.
ACGF will look to mobilize $1.3 billion from a variety of sources, including the ASEAN Infrastructure Fund, ADB, the German development cooperation through KfW, the European Investment Bank, the Republic of Korea and Agence Française de Développement.
Through a biannual event in Singapore, the innovative lab brings together stakeholders across southeast Asia to exchange knowledge, improve their policy-making capacities, and foster the adoption of green finance models in local infrastructure projects, according to ADB.
According to ADB, Southeast Asia needs to invest $210 billion in infrastructure annually until 2030 in order to keep up with growing demand in the region.
“Southeast Asia faces significant financing gaps in meeting its infrastructure needs, including for climate change mitigation and adaptation costs,” said Ramesh Subramaniam, ADB director general for Southeast Asia, at the infrastructure forum. “We need innovative financing approaches to mitigate risks in projects and better leverage public funds to catalyze more financing from private and institutional partners, support greener and cleaner development, and help solve critical development challenges.”
