BlackRock, the Monetary Authority of Singapore (MAS), the International Finance Corporation (IFC), Mitsubishi UFJ Financial Group (MUFG), Nippon Export and Investment Insurance (NEXI), and AIA have signed a Statement of Intent (SOI) to explore a collaborative blended finance debt initiative. This initiative aims to attract global investors interested in funding large-scale decarbonisation projects across Asia, specifically focusing on Southeast Asia. The SOI was signed at the 29th Conference of the Parties (COP29) to the United Nations Framework Convention on Climate Change.
This collaboration is part of the Industrial Transformation Infrastructure Debt Programme, a key component of MAS’ Financing Asia’s Transition Partnership (FAST-P). Announced by the Singapore Government at COP28, FAST-P is a blended finance initiative designed to mobilise up to US$5 billion from public, private, and philanthropic partners to support Southeast Asia’s transition to cleaner energy and sustainable practices.
Southeast Asia faces a significant funding shortfall in decarbonisation efforts. A joint report by the IFC and the International Energy Agency highlights that investment in clean energy in the region may need to increase from US$30 billion in 2022 to an annual US$208-244 billion by the early 2030s to meet growing energy demands. FAST-P’s Industrial Transformation Programme is designed to address this gap by providing new financing pathways for investors to support decarbonisation initiatives across Southeast Asia, attracting additional concessional and commercial capital to accelerate these projects.
Under the SOI, the involved parties will explore debt financing opportunities to support private-sector decarbonisation projects, including those in hard-to-abate industries, technologies for low-carbon transformation, and industrial applications. BlackRock, a global leader in infrastructure investing with approximately US$170 billion in assets under management, will leverage its expertise to contribute to this initiative across key markets and sectors.
Mark Wiedman, Head of Global Client Business, BlackRock said, “Emerging markets in Southeast Asia face hurdles in funding capital-intensive projects like decarbonisation. BlackRock is bringing our blended finance and transition investing expertise to public-private partnerships like FAST-P, benefitting our clients and the societies in which we invest.”
Leong Sing Chiong, Deputy Managing Director, Markets and Development, MAS said, “For Asia to transition to net zero, we must decarbonise sectors of the economy progressively, including carbon intensive or hard-to-abate sectors. Financing for businesses and sectors that seek to adopt cleaner technologies and processes, is an important enabler.”
Riccardo Puliti, Regional Vice President for Asia Pacific, IFC said, “We are delighted to collaborate with MAS, BlackRock and other partners on this important initiative, which will help investors channel the financing required into countries and projects that need it most to accelerate the transition to low-carbon, resilient, and inclusive economic growth in emerging and developing markets in the region.”
Fumitaka Nakahama, Chief Executive and Senior Managing Corporate Executive, Global Corporate and Investment Banking, MUFG said, “We are excited to cooperate on FAST-P and delighted to be part of this initiative in order to support accelerating the sustainable development of Asia.”
Dr. Mark Konyn, Group Chief Investment Officer, AIA said, “Our commitment to decarbonisation is reinforced through our near-term emissions reductions targets validated by the Science Based Targets initiative (SBTi) and this collaboration demonstrates our wider intent to fund appropriate transition opportunities in addition to achieving our SBTi targets.”
