The Asian Development Bank (ADB) on Wednesday announced it is elevating its ambition to deliver climate financing to its developing member countries to $100 billion from 2019-2030.
"The climate crisis is worsening daily, prompting many to call for increased climate finance," said ADB President Masatsugu Asakawa. "We are taking action to meet this call by elevating our ambition to $100bn in cumulative climate finance from our own resources by 2030."
In 2018, the regional development bank committed to ensuring at least 75% of the total number of its operations support climate action and its climate finance resources reach at least a cumulative $80bn by 2030.
The Manila-based lender expects the cumulative climate financing from its own resources in 2019-2021 to reach about $17bn, read a press release.
The expanded climate finance ambition is a key element of ADB's efforts to support its developing member countries. Facing the interconnected challenges of the Covid-19 pandemic and the climate crisis, many developing member countries are taking bold action to promote a green, resilient, and inclusive recovery.
The additional $20b will provide support for the climate agenda in five main areas.
First, new avenues for climate mitigation, including energy storage, energy efficiency, and low-carbon transport. ADB expects its cumulative climate mitigation finance to reach $66bn.
Second, a scale-up of transformative adaptation projects. Projects in climate-sensitive sectors, such as urban, agriculture, and water, will be designed with the primary purpose of effective climate adaptation and enhanced resilience. ADB expects its cumulative adaptation finance to reach $34bn.
Third, an increase in climate finance in ADB's private sector operations. This includes creating more commercially viable projects for both ADB and private investors.
The expansion will be underpinned by improvements in operational efficiencies, a post-pandemic recovery in market demand for financing, new technologies and innovations in climate financing, and new areas of business for private sector climate operations.
ADB intends to support these initiatives with $12bn in cumulative private sector climate finance from its own resources and anticipates crowding in of an additional $18bn to $30bn.
Fourth, support for a green, resilient, and inclusive recovery from Covid-19, including through innovative financing platforms such as the Asean Catalytic Green Finance Facility and Green Recovery Platform, which are expected to leverage funds from capital markets and private sector investors for low-carbon infrastructure.
Fifth, support to advance reforms in developing member countries to unlock actions through policy-based lending to support policies and institutions for enhanced climate resilience and climate mitigation.
Across these areas, the Manila-based lender will continue to expand access to new climate-focused technologies and mobilise private capital towards climate finance.
ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty, added the press release.
Established in 1966, it is owned by 68 members – 49 from the Asian region.