The Monetary Authority of Singapore (MAS) will be hosting a pre-COP27
blended finance conference to promote solutions in helping to fill
Asia's transition financing gap for green industries and economies.
conference, to be held in Singapore on 4 October, will bring together
stakeholders, multilateral development banks, governments, catalytic
donors, institutional investors, and financial institutions from around
the world to manage risk and channel funds towards green and transition
projects in the region.
In his recent remarks in conjunction with the release of the MAS
Sustainability Report 2022, MAS managing director Ravi Menon argued that
while traditional sustainability finance solutions have made headway,
these may not be enough to close the financing gap required.
The risk vs. return ratio of many sustainability projects may be too
high for investors; as such, he said, as of 2021, climate finance has
only reached about 30% of the US$5 trillion of climate investments
estimated by the International Energy Agency that would be required
annually by 2030 to support the world's transition to net zero.
Menon said that funding from the public sector, multilateral banks,
and philanthropic sources can potentially provide critical reduction of
risk and improve project bankability, and can also lead to multiples of
private sector funding. This type of synergising of public and private
capital – through blended finance – was what he identified as a
potential key part of the solution in bridging the financing gap.
Examples of blended finance platforms that Menon cited include the
IFC-MIGA Private Sector Window Blended Finance Facility and the debt
financing platform for green, sustainable infrastructure set up by HSBC
and Temasek with support from Asian Development Bank and Clifford