IF-CAP - INTERNATIONAL
News: New funding mechanism could generate US$ 15
billion for climate action in Asia
What's in the news?
● The
multilateral funding agency Asian Development Bank (ADB) is planning to raise funds in rupee-denominated bonds to finance
projects in India and announced the Innovative Finance Facility for Climate
in Asia and the Pacific (IF-CAP) program to accelerate climate change financing
in the region.
Key takeaways:
● The
announcement was made by ADB President Masatsugu Asakawa on the opening day of
ADB’s 56th Annual Meeting in Incheon.
Innovative Finance Facility for Climate in Asia and
the Pacific (IF-CAP):
● The
Asian Development Bank (ADB)
announced the Innovative Finance Facility for Climate in Asia and the Pacific
(IF-CAP).
Aim:
● It
aims to ramp up support for the region in
the battle against climate change.
Partners:
● IF-CAP’s
initial partners are Denmark, Japan, the
Republic of Korea, Sweden, the United Kingdom, and the United States.
Features:
● IF-CAP
will use guarantees from partners for leverage to accelerate billions of
dollars in much-needed climate change investment – the first time any
multilateral development bank has adopted a program of this kind.
Benefits of IF-CAP:
● With
a model of '$1 in, $5 out', the initial ambition of $3 billion in guarantees
could create up to $15 billion in new loans for much-needed climate projects
across Asia and the Pacific, he said.
● Financing
will help vulnerable countries in Asia and the Pacific region meet their
mitigation and adaptation goals.
● It
will support ADB’s raised ambition for
$100 billion in climate finance from 2019-2030.