Keynote address by Masatsugu Asakawa, President, Asian Development Bank, at the Business 20 (B20) Summit dialogue forum of the G20, 13 November 2022 in Bali, Indonesia
Introduction
Good afternoon, everyone.
I would like to thank the Indonesia Chamber of Commerce for the invitation, and for its success as chair of the Business 20 (B20) this year.
ADB has been proud to be a network partner of B20. The B20 taskforces on issues such as post-COVID recovery and just energy transition have been tremendously valuable.
I am also pleased to share the podium with Mark Tucker. ADB is grateful for HSBC’s engagement in the work on our Energy Transition Mechanism. Mark, thank you very much for your support.
My friends, let me share with you today some thoughts about the importance of private investments in the fight against climate change.
The threat of climate change to Asia and the Pacific
Despite the current economic headwinds, the economic growth of Asia and the Pacific in recent decades has been remarkable. But the uncomfortable truth is that growth has come at a high cost: our region now accounts for more than 50% of global greenhouse gas emissions.
At the same time, the region is one of the most vulnerable to the impacts of climate change. Climate change is putting decades of progress at great risk.
That is why our battle against climate change will be won or lost in Asia and the Pacific. We need to take bold and urgent action to address this threat.
In response, ADB has stepped up as the Climate Bank for Asia and the Pacific.
We have elevated our ambition to provide $100 billion in cumulative climate finance from 2019 to 2030. We have committed to withdraw from investing in new coal-fired power generation capacity. And we are launching game-changing platforms to scale up climate financing.
In our endeavor, the private sector is essential to ensuring the transition to net zero. It is clear that the public sector cannot do it alone.
The good news is that climate action is often a good investment. Costs for renewable energy are falling, and demand for low-carbon infrastructure and goods and services is rising. The investment opportunities in developing economies have been estimated at trillions of dollars.
ADB is committed to strengthening this promising investment landscape. We will use our convening power, financing instruments, and technical capabilities to pave the way for private sector investments that are compatible with low-carbon development.
Let me briefly highlight four areas where we are working.
First, ADB is addressing upstream policy challenges that are hindering private investment in infrastructure. Our work includes support to improve regulatory frameworks, like the Minister just mentioned, and the capacity of government agencies.
Second, ADB is working midstream, with public sector agencies, to structure infrastructure projects that are commercially viable. Last year alone, we catalyzed more than $400 million in private capital through our PPP advisory services and project preparation facilities.
Third, ADB is working downstream, directly with private sector clients, to invest jointly in renewable energy projects. For example, we committed $40 million in 2018 to Indonesia’s very first privately-owned utility-scale solar plant, a 21 megawatt facility in North Sulawesi.
Fourth, we are helping the region transition away from coal-based energy. The Energy Transition Mechanism, ETM, will accelerate the retirement of coal-fired power plants, increase demand for clean energy, and lower overall energy costs. I am so grateful to Indonesia and partners like HSBC, who have been made this possible.
Last week, I had the pleasure of meeting with President Widodo in Cambodia. We discussed the need to mobilize substantial financial resources for the energy transition, and I am proud to say that ETM is one of the many ways ADB is doing just that. Together with the Government of Indonesia, ADB will make a landmark announcement about ETM tomorrow.
Closing
Let me end by inviting all of you to engage with ADB.
We want to hear your perspective on the barriers and opportunities to private sector participation in climate action, and we want to work with you.
My friends, let’s work together to achieve a carbon neutral future—by creating a region built on green investments that ensure resilient, sustainable economic growth for all.
Thank you very much for your attention.
