A new US$1bn joint facility has been launched to finance green infrastructure investments across Southeast Asia.

Announced last week by the Asian Development Bank (ADB), the facility mobilises resources and expertise from the ASEAN Infrastructure Fund (AIF), Kreditanstalt fuer Wiederaufbau (KfW), the European Investment Bank, (EIB) and the Agence Française de Developpement (AFD).

The ‘ASEAN Catalytic Green Finance Facility’ will aid what the ADB calls “climate-vulnerable sovereigns” in the region to meet their commitments under the Paris Agreement, while helping ADB achieve its long-term operational targets.

The new facility will increase resources available to ASEAN governments and will assist ASEAN countries in identifying and designing projects that are tied to measurable green and climate-related goals. In addition to direct financing through the provision of loans, funding will also be made available to reduce the risks associated with investing in green infrastructure, including guarantees, which will promote private sector co-financing.

ADB said it does not expect the development of the facility to affect its financial position, but said it will help achieve its $6bn climate financing target by 2020; as of 2017, ADB’s aggregate climate financing reached $5.2bn.

In addition, the new facility will also help ADB attain more ambitious targets under Strategy 2030, its long-term corporate strategy launched in 2018. In Strategy 2030, the bank has committed to $80bn in cumulative climate financing between 2019 and 2030, with 75% of its committed operations addressing climate change mitigation and adaption by 2030.

According to Moody’s Investors Service, the ASEAN Infrastructure Fund (AIF) has committed $520 million for energy, transport, water, and urban infrastructure projects to addressed risks posed by climate change to economic activity, infrastructure, and populations in the region.