Questions? +1 (202) 335-3939 Login
Trusted News Since 1995
A service for global professionals · Thursday, February 29, 2024 · 692,363,878 Articles · 3+ Million Readers

BII, ADB to support narrowing global trade finance gap

VIETNAM, January 20 -  

HÀ NỘI — British International Investment (BII), the UK’s development finance institution (DFI) and impact investor, and the Asian Development Bank (ADB) have recently announced a new partnership to finance up to US$100 million of green trade transactions in the region, including Việt Nam.

The partnership will be managed through ADB’s Trade and Supply Chain Finance Programme (TSCFP) and will focus on renewable energy, energy efficiency and climate-smart agriculture to support the region’s energy transition and climate resilience.

The BII-ADB partnership aims to reduce the global trade finance gap and address the unmet demand for longer tenor green transactions.

The risk sharing agreement between the two organisations will help international banks increase their financing support to local banks, initially in Việt Nam, before expanding to other countries supported by BII and ADB.

This will provide crucial financing for local importers of solar panels, wind turbines, electric vehicles, and agricultural goods which will support the region to transition to cleaner sources of energy. 

Andrew Mitchell, UK Minister for Development and Africa, said: “This agreement between BII and the Asian Development Bank will unlock crucial green trade finance in Asia. It demonstrates how, by working together, the development finance system can mobilise the private finance so urgently needed to support countries in their transition to low carbon, climate-resilient economies.”

In South and Southeast Asia, two of the most vulnerable regions to climate change, enabling development of more renewable energy capacity and its supply chain is essential to achieve the region’s sustainability goals. 

Trade is a critical part of this as it enables the flow of goods that help regions to mitigate and adapt to the impact of climate change.

However, it is estimated that there is a global trade finance gap of $2.5 trillion annually, which means businesses lack access to the financing needed to trade energy transition goods for climate projects.

Furthermore, local banks are currently not able to fully meet the demand to provide longer tenors required to finance goods for climate related projects, particularly within the renewable energy sector. 

Srini Nagarajan, Managing Director and Head of Asia at BII, commented: "Supporting sustainable development in South and Southeast Asia is a key priority at BII. Green trade finance enables supply chain development of the renewable energy industry and tackles the bottleneck for much needed long tenor financing in the region. We are delighted to work with ADB, a strong partner with extensive knowledge and network in Asia, on a shared ambition to support the region’s energy transition and build climate resilience.”

ADB added that the collaboration with BII will strengthen ADB TSCFP’s capacity to further grow green supply chains in the Asia-Pacific region, with a focus on energy transition goods that are essential for tackling climate change. – VNS



Powered by EIN Presswire
Distribution channels:

EIN Presswire does not exercise editorial control over third-party content provided, uploaded, published, or distributed by users of EIN Presswire. We are a distributor, not a publisher, of 3rd party content. Such content may contain the views, opinions, statements, offers, and other material of the respective users, suppliers, participants, or authors.

Submit your press release