ADB, Singapore’s Infrastructure Asia tie up for green infra

Asian Development Bank (ADB) and Singapore’s Infrastructure Asia have signed a cooperation agreement to help governments in Southeast Asia identify and develop bankable green infrastructure projects.

Specifically, the agreement will allow the two entities to help state-owned enterprises, as well as regional and municipal governments adopt innovative and green finance approaches to pursue such projects.

Assistance will also be given in improving institutional, financial and governance capacities of government agencies.

The agreement was signed during the Asia Infrastructure Forum in Singapore Wednesday by ADB director general for Southeast Asia Ramesh Subramaniam and Infrastructure Asia executive director Seth Tan.

ADB estimates that Southeast Asia needs an annual infrastructure investment of $210 billion until 2030 to respond to rapid economic growth and challenges posed by climate change.

“Southeast Asia faces significant financing gaps in meeting its infrastructure needs, including for climate change mitigation and adaptation costs,” Subramaniam said.

“We need innovative financing approaches to mitigate risks in infrastructure projects and better leverage public funds, so that many more funds are catalyzed from private and institutional sources to support greener, cleaner, and timely infrastructure development,” he added.

Tan said through the partnership, Infrastructure Asia and ADB would be able to enhance the access of government firms and local units to private capital because projects would be bankable.

“Projects structured with better financial and technical elements, along with good partnerships, are key to helping improve the bankability of Asia’s sustainable infrastructure projects,” Tan said.

“Through this collaboration with ADB, Infrastructure Asia will work in close consultation with the international financing, credit enhancement, and technology ecosystem in Singapore to improve municipalities and state-owned enterprises’ access to private capital,” he added.

Infrastructure Asia is an initiative by Enterprise Singapore, the business development arm of the Singaporean government, and the Monetary Authority of Singapore, to support infrastructure financing and development in the region.

Through this initiative, foreign governments gain access to the technical expertise and financing solutions offered by infrastructure firms based in Singapore and Singapore-based firms potentially gain access to opportunities.

ADB and Infrastructure Asia will launch the Innovative Finance Lab for Sustainable Infrastructure—a virtual space supported by a biannual event in Singapore—to gather stakeholders across Southeast Asia together to exchange knowledge, improve their policy-making capacities, and foster the adoption of innovative and green finance models in local infrastructure projects.