INVESTING IN CLIMATE ACTION
As Asia’s climate partner, AIIB brings capital, capacity and convening power to accelerate financing solutions to climate change. In particular, AIIB is focusing on increasing investment into climate-technology and climate resilient infrastructure where it is most needed, so that no country is left behind.
AIIB's climate finance investment has grown to 48% of its total investment portfolio. We are on track to achieve our target of at least 50% climate finance of our actual financing approvals by 2025. We are also committed to align all our new financing operations with the goals of the Paris Agreement by July 1, 2023.
Climate financing aligns with our broader mission of financing Infrastructure for Tomorrow: green infrastructure with sustainability, innovation and connectivity at its core. By investing in low-carbon infrastructure projects, we help reduce emissions, generate renewable energy, and promote sustainable development. By working with our clients and partners, we incorporate climate-resilience features in project design. By partnering with various market participants, we help to influence investing strategies that factor in environmental and social standards, as well as climate adaptive responsive-behavior, in investing decisions.
AIIB AT COP27
AIIB President and Chair of the Board of Directors Jin Liqun will lead the AIIB delegation at COP27 in Sharm El Sheikh, Egypt. We look forward to welcoming our partners and clients to the Joint MDB Pavilion. Details of AIIB-led events at COP27 and our speakers can be found below.
All events will be livestreamed on YouTube.
When: Nov. 8, 9-10:30 a.m. (Cairo Time)
Location: Blue Zone, Multilateral Development Bank (MDB) Pavilion
The financing gap to address climate change and keep to 1.5 degrees is trillions of dollars. Current funding amounts are not meeting needs nor is the pace of capital mobilization increasing sufficiently to meet future requirements. Given the current macro-economic situation and continued impacts of various crises, it can be expected that the availability of near-term climate finance will be further constrained. It is therefore more important than ever that all parties work together to develop and implement effective structure to mobilize capital and in particular increase private sector financing.
Considering the inherent characteristics of climate finance, and in particular financing in developing countries, the role of concessional finance is critical to enabling and growing private sector involvement. Sources of concessional finance for climate change are growing in number and size. Traditional bilateral sources from governments and international agencies are increasingly supplemented by private foundations and philanthropy. Although the need for and role of concessional financing is well known, a mismatch continues to exist between concessional finance providers and private financiers. MDBs have a critical role to play in bringing parties together and in enabling a more effective deployment of concessional finance aimed at maximizing private capital mobilization.
Watch the session replay on YouTube.
When: Nov. 9, 8:45-10:00 a.m. (Cairo Time)
Location: Blue Zone, Multilateral Development Bank (MDB) Pavilion
The net-zero transition is increasingly characterized as a “moonshot”, a once-in-a-lifetime inspirational project requiring a mission-driven industrial policy with coordination across all parts of the economy, and in the end globally. In emerging and developing economies these “moonshots” are very much about speeding up adaptation and imitation of green innovation elsewhere but doing so in a mission-driven purposeful manner. Reaching net zero in time will be the greatest challenge for state capacity to date for these economies. The impact of climate change will be the most severe where state capacity is in the shortest supply. The state will need to work with all the instruments it has at its disposal, harnessing the private sector and working with development partners, but it must go beyond individual instruments and collaborations and step in to solve coordination failures. This year’s AIF examines the main “tools” of the state – the state-owned enterprises (SOEs), the state-owned financial institutions (SOFIs) and private-public partnerships (PPPs) together with national innovation and technology adoption frameworks – and how these can work together to accelerate the net-zero transition.
Watch the session replay on YouTube.
When: Nov. 11, 9-10:30 a.m. (Cairo Time)
Location: Blue Zone, Multilateral Development Bank (MDB) Pavilion
Technology is an important component of the climate change solution. From electrical vehicles to hydrogen, from smart grids to smart buildings, or energy efficiency to flood prediction and management systems, the development of new technology plays a vital role in mitigating and adapting to climate change. However, existing technologies such as solar and wind, while having proven their abilities and cost competitiveness cannot in themselves provide the solution to the diversity and magnitude of the climate challenge.
While technologies crucial to achieving net zero are drawing increasing investor focus, funding for climate adaptation and resilience technologies lag. Overall securing climate impact and commercial returns remains difficult in new technologies, while majority of investments and technology adoptions also continue to be in the developed world.
This event will explore what measures can be taken to accelerate the supply of both innovation and commercially viable technologies in general and specifically to developing countries. It will also question what role MDBs can play in financing the development and adoption of technologies
Watch the session replay on YouTube.
When: Nov. 14, 9-10:30 a.m. (Cairo Time)
Location: Blue Zone, Multilateral Development Bank (MDB) Pavilion
Climate change has a profound impact on infrastructure assets, as well as economic and social implications. Adapting our existing infrastructure to such shocks requires effective deployment of trillions of dollars mobilized from all available sources of finance, relying on public funding alone is not enough. A growing number of institutional investors, investment funds, and credit institutions have shown interest in climate change and sustainability. In order to attract more capital in resilient infrastructure financing, there is a need for innovative financial instruments or tailored products, such as bonds or other asset-backed securities.
Green bonds are one of the most important types of climate-related bonds, representing one-half of the global total issuances of climate-related bonds. Tapping into existing green bond market can be an effective way to bring the needed capital to support resilient infrastructure financing, as investor demand for thematic bonds has been increasing, with resilience and recovery being of particular interest post COVID-19.
A number of AIIB’s sessions during COP27 will be livestreamed on AIIB's YouTube channel.
View the full session details and confirmed speakers list here.
When: Nov. 17, 9-10 a.m. (Cairo Time)
Location: Blue Zone, Multilateral Development Bank (MDB) Pavilion
Investing in sustainable infrastructure is part of AIIB’s DNA. Its Corporate Strategy targeted that climate finance will make up more than 50% of its financing approvals by 2025.In 2021, AIIB’s climate finance has totaled 48% of approved financing, up from 41% in the previous year. These financings span the energy, transport, urban and water infrastructure sectors.
A panel comprised of AIIB project leads will showcase, through case study examples, how AIIB has supported its clients from both the government and private sector address climate change risks across the project cycle, namely project design and implementation. The panel will also include an AIIB client’s perspective. Finally, the panel will explore challenges and opportunities of supporting countries, and how AIIB and its clients can work together, towards climate action.
A number of AIIB’s sessions during COP27 will be livestreamed on AIIB's YouTube channel.
View the full session details and confirmed speakers list here.
