ADB, Jica set up $16-B fund for infra projects in Asia Pacific
Asia-Pacific countries now have more options for financing key infrastructure projects, after Manila-based Asian Development Bank (ADB) and the Japan International Cooperation Agency (Jica) announced the establishment of two new infrastructure funds.
The two funds, which have a combined worth of $16 billion, can finance sustainable infrastructure projects by the private sector and those that will be undertaken via public-private partnership (PPP) schemes.
“Through its assistance for
urban transport, renewable energy and other infrastructure, the partnership will also contribute to the expansion of climate financing to developing countries, in line with the expected outcome of the COP21 [21st Conference of Parties] meeting in December,” ADB President Takehiko Nakao said. The ADB and Jica established a $6-billion-worth fund to finance private-sector investments in sustainable infrastructure in Asia and the Pacific.
The trust fund, which will be managed by the ADB’s Private Sector Operations Department, will also be capitalized with $1.5 billion in equity from Jica. The fund will enable the ADB to expand large-scale private infrastructure operations by leveraging Jica’s official development assistance (ODA) resources and risk-bearing capacity.
Meanwhile, the ADB and Jica will provide financing of $5 billion each to create a $10-billion fund for sovereign borrowers undertaking sustainable infrastructure projects.
The ADB and Jica said they will collaborate to support long-term investment plans using ADB’s Multi-Tranche Financing Facility. They will also provide necessary technical assistance for preparing and implementing projects, leveraging the comparative advantages of each institution.
The two organizations will soon sign a memorandum of understanding on the partnership. The ADB and the Japanese government have agreed to hold regular high-level policy dialogues to effectively implement infrastructure investments under the partnership.
The ADB will seek similar arrangements with other development partners to meet the SDGs, increase climate financing, support quality and sustainable infrastructure development, promote private-sector development and operations, and address other development issues.
The SDGs were adopted by 193 countries, including the Philippines, in September 2015. It contains 17 goals, and one of them is in building resilient infrastructure, promote inclusive
and sustainable industrialization and foster innovation.
The goal aims to promote the building of quality infrastructure that are affordable and provides equitable access for all, and promote inclusive and sustainable industrialization by raising the industry’s share of employment and GDP.
Building quality sustainable infrastructure is Goal 9 of the Global Goals, or the SDGs, which must be met by 2030.
The goal also aims to increase access of small-scale enterprises in developing countries to financial services and affordable credit, as well as increase industries use of clean and environmentally sound technologies.
SDG 9 also aims to enhance scientific research, upgrade the technological capabilities of industrial sectors in all countries, in particular developing countries, and increase the number of research and development workers per 1 million people by 2030.
Other SDGs aim to end poverty and hunger, promote universal health, education for all and lifelong learning, achieve gender equality, sustainable water management, ensure sustainable energy for all, decent work for all, and reduce income inequality between and among countries.
Source: www.businessmirror.com.ph
Comment here