Catalyzing Climate Finance with the Shandong Green Development Fund
Jenny, Hubert; Wang, Yihong; Dahiya, Bharat; Asseline, Frédéric; Mehta, Anouj | July 2020
Abstract
In 2019, the Asian Development Bank (ADB) approved a $100 million loan contributing to climate finance for the $1.5 billion Shandong Green Development Fund Project. The fund introduces an innovative leveraging mechanism to catalyze private, institutional, and commercial capital for the development of climate-friendly infrastructure and business in Shandong Province, the People’s Republic of China (PRC). The project focuses on the twin strategic agendas of environmentally sustainable growth and inclusive economic growth. The fund will finance a portfolio of mitigation and adaptation projects assessed against both financial and climate eligibility criteria using the Green Climate Fund investment framework. The project will contribute to the transition to low-carbon and climate-resilient development paths in Shandong Province. The fund will act as the financial arm of the Shandong Provincial Government to implement its progressive climate policies and to decarbonize its economy. The fund holds seed capital of $400 million from international financial institutions, $360 million from public sources, and $740 million from private investors to cofinance about $7.5 billion of climate-positive investment, achieving a leveraging ratio of over 1:5. By 2027, the fund aims to contribute to (i) climate change mitigation, measured through carbon emission reductions of 3.75 million tons annually, and (ii) climate change adaptation, measured through improvement in climate resilience of over 3 million beneficiaries. It is the first climate fund in the PRC to be categorized as effective gender mainstreaming.
Citation
Jenny, Hubert; Wang, Yihong; Dahiya, Bharat; Asseline, Frédéric; Mehta, Anouj. 2020. Catalyzing Climate Finance with the Shandong Green Development Fund. © Asian Development Bank. http://hdl.handle.net/11540/12227. License: CC BY 3.0 IGO.PDF ISBN
978-92-9262-271-8
Print ISBN
978-92-9262-270-1
ISSN
2071-7202 (print)
2218-2675 (electronic)
Keywords
Climate
Climate change
Climate impacts assessment
Global climate change
Asian Development Bank
Development
Regional Economic Integration
Financial Sector Policies
Financial Risk Management
Bond Financing
Green bonds
Green financing
Climatic change
Climatic influence
Climatology
Investment bank
Investment policy
Capital Market
Regional Plans
Regional Development Bank
Development finance
Municipal Bonds
Local Government
Local Taxes
International Monetary Relations
International Financial Market
International Banking
Central Banks
Business Financing
Capital Resources
Budgetary Policy
Capital Needs
Corporate Divestiture
Capital Instruments
Pension Funds
Insurance Companies
Banks
Portfolio Management
Fiscal Administration
Economics of Education
Development Banks
Insurers
Insurance stocks
Insurance holding companies
Insurance carriers
Insurance agencies
Business subsidies
Investment companies
Foreign investment
Equity Finance
International banks and banking
Stock exchanges
Grants
Loans
Communication in rural development
Communication in community development
City planning
Urban climatology
Bank investment
Capital investment
Investment banking
Venture capital
Local government bonds
Bonds
Catastrophe bonds
Bond funds
Bond market
Multilateral development banks
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