The Asian Infrastructure Investment Bank (AIIB) and the Green Climate Fund (GCF) signed an Accreditation Master Agreement (AMA) at the 10th AIIB Annual Meeting of its Board of Governors on June 25, 2025. The agreement underscores the deepening collaboration between the two institutions to drive sustainable climate-aligned infrastructure investments globally.

With the signing of this agreement, AIIB becomes a fully accredited entity to now access GCF concessional funding, expanding the Bank’s capacity to co-finance and implement projects that support climate resilience and inclusive development. The agreement will enable both institutions to scale up joint efforts and deliver greater impact across Asia and other developing regions.

The partnership builds on AIIB’s Climate Action Plan, which guides the Bank’s climate investment strategy to 2030. The plan underscores the role of infrastructure in achieving global climate goals and identifies focus areas for mitigation and adaptation financing.

“Climate change is the defining challenge of our time, and the scale of financing needed, particularly for adaptation, is immense,” said Quan Zheng, Acting Vice President, Policy and Strategy, AIIB. “AIIB has committed to aligning our investments with our Members’ climate priorities, and we have already surpassed our 50% climate finance target ahead of schedule.”

The partnership with GCF should unlock greater flows of climate finance to developing economies where infrastructure is a critical lever in advancing sustainable growth, Zheng added.

Henry Gonzalez, GCF Chief Investment Officer said: “The signing of the AMA between GCF and AIIB marks a key milestone in our shared commitment to accelerate global climate action. Through this partnership, we will unlock innovative financing solutions that support GCF’s 50by30 vision and drive impactful, climate-resilient development.”

About AIIB

The Asian Infrastructure Investment Bank is a multilateral development bank dedicated to financing “infrastructure for tomorrow,” with sustainability at its core. AIIB began operations in 2016, now has 110 approved members worldwide, is capitalized at USD100 billion and is AAA-rated by major international credit rating agencies. AIIB collaborates with partners to mobilize capital and invest in infrastructure and other productive sectors that foster sustainable economic development and enhance regional connectivity.

About Green Climate Fund (GCF)

The Green Climate Fund (GCF) is the world’s largest dedicated fund helping developing countries respond to climate change. Established in 2010 by the 194 parties to the United Nations Framework Convention on Climate Change (UNFCCC), it is headquartered in Songdo, Korea. Governed by a 24-member Board, GCF aims to drive a global paradigm shift in climate action by supporting low-emission, climate-resilient development in developing countries.

Sign up now: Get ST’s newsletters delivered to your inbox

Monetary Authority of Singapore managing director Chia Der Jiun underscored the need for financing methods like Fast-P, an initiative launched by MAS in 2023.

SINGAPORE – Singapore will in the coming months be ready to deploy part of the US$500 million (S$646 million) it had set aside as initial funding for green projects in the region, with the set-up of a new office to advance a scheme announced in 2023.

This update to Fast-P – or Financing Asia’s Transition Partnership – was announced by Monetary Authority of Singapore (MAS) managing director Chia Der Jiun on May 7 at the Ecosperity Week sustainability conference.

“I am also glad to share that a Fast-P office, with a dedicated management team, will soon be set up to facilitate the deployment of up to US$500 million of concessional capital from the Singapore Government into Fast-P, alongside capital from other partners,” he said.

The new office by the MAS will help to fund marginally bankable clean energy infrastructure in Asia, which can be deemed too risky or unprofitable for investors.

The goal of Fast-P, an initiative launched by MAS in 2023 , is to use an initial injection of funds by the Singapore Government to increase funding from other sources.

The US$500 million will come in the form of concessional funding, such as grants and loans provided at more favourable terms and below market rates.

This funding will match, dollar for dollar, concessional capital from other partners, including other governments, multilateral development banks and philanthropic institutions.

The aim is to raise a total of US$5 billion with the help of other commercial and philanthropic partners.

The funds will go to three pillars – accelerating the energy transition away from fossil fuels to clean energy, ramping up green investments, and decarbonising emissions-intensive sectors like cement and steel production.

The second pillar on green investments will be the first to commence investments in the coming months.

Mr Chia did not specify the types of clean energy infrastructure projects that will receive the funding.

But this pillar focuses on renewable energy plants and storage, electric vehicles, transport, and water and waste management projects, said a 2024 MAS media release.

Mr Chia noted that Asia’s demand for electricity is projected to rise at an annual rate of 4 per cent until 2035.

The International Energy Agency expects renewable energy to supply more than half of Asia’s increased electricity demand.

“Global corporate investment may also turn more cautious amid heightened trade and economic uncertainty,” Mr Chia added, underscoring the need for financing methods like Fast-P.

He noted that the insurance industry plays a key role in finding solutions to reduce the risk of renewables and decarbonisation projects for commercial investors.

At Ecosperity’s Financing Asia’s Transition Conference on May 7, Malaysia’s Natural Resources and Environmental Sustainability Minister Nik Nazmi Nik Ahmad shared Mr Chia’s views.

“While our ambitions are high, we need the financial infrastructure to match,” said Mr Nik Nazmi in a recorded speech.

Mr Chia also outlined the other ways that Singapore’s financial sector is pressing ahead with climate efforts, even as climate action elsewhere falters.

For instance, steps have been taken to shore up banks’ resilience to climate and nature risks, such as damage to assets and infrastructure from extreme weather, and disruptions to supply chains.

Revenue may come under threat, or companies may have to incur additional costs from new regulations or increased consumer scrutiny.

Thus, financial institutions here have integrated such risks into their internal credit risk models, asset valuation and due diligence processes, Mr Chia said.

“Doing so will enable them to better anticipate and manage financial loss, minimise stranded assets, and uncover new financing and investment opportunities,” he added.

Other than factoring in climate risks in financial assessments, financial institutions here are also increasingly aware of the impact of nature loss on operations.

The Singapore Sustainable Finance Association had highlighted in a report that the degradation of nature represents a risk to companies’ activities and to financial portfolios. Nature gets stressed from economic activities that cause pollution and deplete natural resources.

The association’s white paper listed practical steps for financial institutions to incorporate nature into their business activity.

The paper – titled Financing Our Natural Capital – highlighted that plans to reverse negative impacts and restore nature can unlock US$4.3 trillion and 232 million jobs in Asia.

“Ultimately, financial institutions can respond on two fronts: by managing exposure to growing climate and nature-related risks, and by innovating to finance and de-risk adaptation, resilience and nature-positive solutions,” said Mr Chia.

In a further boost to climate finance, a global accelerator that aims to bridge the investment and capacity gap in developing countries was launched at Ecosperity on May 7.

Spearheaded by the Global Capacity Building Coalition – a grouping of climate finance organisations – the initiative is open to applicants who can showcase their efforts to develop climate finance to ramp up efforts in energy transition.

The coalition said in a statement that to increase climate finance to sustainable development in emerging economies, it is important to first strengthen the capacity of local financial institutions.

This is something that the accelerator hopes to do by highlighting and supporting capacity-building initiatives.

Recipients will, among other things, be provided with access to and advice from experts, and marketing and communication support.

The development of Eswatini’s third climate action plan, known as the Nationally Determined Contributions (NDC 3.0), gained momentum as the construction industry gathered to explore strategies for climate-resilient development.

Held under the theme “Adapting to Climate-Resilient Construction Practices in the Built Environment,” the one-day stakeholder forum was organised by the Construction Industry Council (CIC) with support from the United Nations Development Programme (UNDP) under the NDC initiative.

Urgent Need for Climate-Resilient Infrastructure

The CIC Stakeholder Forum took place on 19 June at Esibayeni Lodge, Matsapha. Speakers emphasised the urgent need for action, citing the destruction and costs caused by climate-related events such as floods, hailstorms, and strong winds.

The Minister of Public Works and Transport, Hon. Chief Ndlaluhlaza Ndwandwe, noted the relevance of the dialogue, as Eswatini continues to face rising infrastructure damage due to climate change.

“Building climate resilient infrastructure is at the top of our agenda as a Ministry going into the future, and we are looking forward to having more forums and stakeholder engagements of a similar nature to ensure we implement best practices in developing quality infrastructure,” he said.

UNDP Backs Implementation of NDC 3.0

UNDP Resident Representative Mr. Henrik Franklin echoed the call to action, stressing that NDC 3.0 is now about implementation. He commended the construction sector for its leadership in climate action, aligned with the UN Sustainable Development Goals.

“From energy-efficient housing and flood-resilient public buildings and infrastructure like roads and dams, to low-carbon infrastructure and green jobs, your construction industry sector has immense potential to lead,” he said, adding: “We are grateful to the support we have been receiving through the NDC Partnership in updating Eswatini’s NDC.”

He thanked the British Government for funding the process and urged stakeholders to adopt sustainable practices.

He advocated for a circular economy “where used materials become a future resource, moving from ‘cradle to grave’ to ‘cradle to cradle’.”

Franklin emphasised the construction industry’s responsibility in ensuring the use of sustainable building materials.

Despite suffering a significant setback in the recent federal election, Germany’s Greens have helped push through a major spending package to boost infrastructure, defense and climate protection.

The center-right Christian Democrats (CDU), their Bavarian sister party the Christian Social Union (CSU) and the center-left Social Democrats (SPD) have come one step closer to their goal of forming a coalition government. This involved likely new Chancellor Friedrich Merz (CDU) making major concessions to the Greens in order to get his ambitious plan for hundreds of billions of euros in investments off the ground.

Without the Greens, whose losses in February’s federal election means they’re soon to be in opposition, Merz’s plan would not have worked.

The future governing partners are planning a budget that will see Germany take on an extra €500 billion in debt for investment in infrastructure. However, this requires a change to the constititution which in turn can only be decided with a two-thirds majority in both chambers of parliament. To achieve this, the CDU bloc and SPD needed the votes of the Greens in the lower house, the Bundestag, this Tuesday (March 18).

The Greens demanded that €100 billion of the package go into the Climate Transformation Fund (Klima Transformationsfonds) and their demands were eventually met.

Will Germany’s trillion-euro debt gamble pay off? To view this video please enable JavaScript, and consider upgrading to a web browser that supports HTML5 video

Does climate protection now have constitutional status?

Under pressure from the Greens, the text of the amendment to the Basic Law now states that the planned special fund of €500 billion is earmarked for “investments in infrastructure and for additional investments to achieve climate neutrality by 2045.”

The last part of the wording caused quite a stir among many conservatives and part of the business community. Is climate neutrality by 2045 being written into the constitution as a national objective? Would that mean that all other infrastructure investments would have to be subordinate to it?

Former judge at the Federal Constitutional Court, Udo Di Fabio, thinks not. “This does not result in a state objective of climate protection with a commitment to climate neutrality by 2045,” he says.

Christian Calliess, Professor of Constitutional and Environmental Law at the Free University of Berlin, agrees with that assessment. The wording merely clarifies that part of the “special infrastructure fund” must be used for climate protection, he told the Handelsblatt newspaper.

The “state objective of environmental protection,” is already enshrined in the constitution and this includes climate protection. In 2021, Germany’s high court ruled that legislators must not favor current generations by placing an excessive burden on future generations. On this basis, individuals can also sue the state if they believe their civil liberties are endangered by measures that supposedly jeopardize climate protection.

The Green Party drove a hard bargain ahead of Tuesday’s vote Image: Jens Krick/Flashpic/picture alliance

Nevertheless, quite a few politicians are concerned that Merz has gone too far in his concessions towards the Greens.

Wolfgang Kubicki of the neoliberal Free Democrats (FDP) told the newspaper Welt: “There will be a large number of lawsuits on the grounds that these investments would run counter to the 2045 climate protection target. The burden of proof will then lie with the state. That will be difficult.”

Greens celebrate

Meanwhile, the Greens are celebrating a major victory, perhaps the biggest since they formed a governing coalition with the FDP and the SPD in the fall of 2021. From the outset, they had intended to invest billions of euros in climate protection. But the plan to reallocate money left from a fund set up to mitigate the economic fallout of the COVID-19 pandemic was struck down by the Federal Constitutional Court in 2023, scuppering the ambitious plans.

This, plus other major budget disputes, were partly why the center-left government of the SPD, Greens and FDP fell apart in November last year.

This article was originally written in German.

While you’re here: Every Tuesday, DW editors round up what is happening in German politics and society. You can sign up here for the weekly email newsletter Berlin Briefing.