Asian Development Bank issued the following announcement on Feb. 15.
Countries in Southeast Asia need to promote innovative green and blue finance approaches to address the rising financing gap for sustainable infrastructure in the region, according to an Association of Southeast Asian Nations (ASEAN) workshop in Bangkok.
The event on Innovative Financing Approaches for Sustainable Infrastructure, a preview to the ASEAN Finance Ministers Meeting in April, was jointly hosted on 11 February 2019 by Thailand’s Ministry of Finance with the support of the Asian Development Bank (ADB). Held in conjunction with the ASEAN Finance and Central Bank Deputies’ Working Group Meeting, the workshop gathered together government officials, private sector representatives, and other experts to discuss the way forward for innovative finance in the region.
“The ASEAN region faces significant infrastructure needs,” said ADB Director General for Southeast Asia Mr. Ramesh Subramaniam. “We need innovative financing approaches that mitigate risks in projects and bring more partners to the table; support greener, cleaner development; and help solve critical development challenges.”
Deputy Director-General of Thailand’s Fiscal Policy Office Ms. Ketsuda Supradit said the workshop marks the beginning of a series of activities by the Thai government as chair of ASEAN in 2019, which views enhancing ASEAN’s connectivity as a priority under the finance track. In addition, the workshop findings were reported to the ASEAN Finance and Central Bank Deputies’ Working Group Meeting, as well as the Working Committee on Capital Market Development and the ASEAN Capital Markets Forum.
Infrastructure financing needs for ASEAN members is estimated at around $210 billion per year when taking into account climate change mitigation and adaptation costs, according to ADB. Public budgets alone will not be able to bridge this need, hence, the urgency to catalyze private capital sources.
Using public finance efficiently to mobilize funds from capital markets and attract commercial investors is gaining traction globally and in the region. The Thailand Future Fund, Indonesia’s Sustainable Development Goals One platform, and the new ASEAN Catalytic Green Finance Facility of the ASEAN Infrastructure Fund are examples of how public funds can be leveraged to catalyze private capital for sustainable infrastructure.
The workshop reviewed these efforts and highlighted the needs for a stable and predictable regulatory environment and the strategic use of public funds on project development to mitigate risks and attract investors to scale up private investment in climate change and conservation efforts.
“Green finance” opened the thematic sessions with a context setting presentation on financial initiatives needed to promote environmental improvement, climate change mitigation and adaptation, as well as improving efficiencies in natural capital preservation and resource mobilization. “Blue finance” was discussed as a needed new theme to mobilize finance effectively to address rising pollution caused by plastics and other sources in the region’s rivers and ocean bodies. Both potential green and blue finance mechanisms, examples, and structures were discussed. The ASEAN working group meetings will continue through Friday in Bangkok.
ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 67 members—48 from the region.
Original source can be found here.
Source: Asian Development Bank