ImpactAlpha, August 31 — Innovative financing mechanisms could help catalyze the more than $3 trillion gap in sustainable infrastructure financing in Southeast Asia through 2030, according to the Asian Development Bank.
Singapore-based Temasek and London-based HSBC have committed equity funding to launch Pentagreen Capital, a debt-financing platform for clean transport, clean energy and energy storage, and water and waste management projects in the region.
Pentagreen will later consider opportunities outside Southeast Asia, as well as projects in agriculture, land use and climate adaptation (see, “Climate adaptation gets a fund of its own to invest in data, analytics and resilience”). The platform aims to deploy at least $1 billion within five years.
Pentagreen’s Marat Zapparov, ex-of International Finance Corp., hopes to attract commercial investors by bringing flexible debt capital to the table. ADB will provide technical assistance and project development services; Clifford Capital will provide project finance and back office support.
“Neither private nor public sector can close the financing gap alone,” said HSBC’s Noel Quinn. The partners, he said, “can deploy significant amounts of blended finance for projects in Southeast Asia that would otherwise go unfunded.”